Annette Malpica, Vice President, Director of Claims & Legal Counsel, Lovell Safety Management Co., LLC

The following workers’ compensation bills were passed by the NYS Senate and Assembly in the 2022 legislative session. These bills must be presented to Governor Hochul before the end of the year either for veto or signature into law. If enacted, these bills will increase benefits by millions of dollars, resulting in higher costs for all NYS employers. Further, these bills will decrease the incentives to return to work, and radically change the landscape of the workers’ compensation law.

Bill A1118/S.768 – Amends WCL §15(2) to define temporary total disability as: “[t]he injured employee’s inability to perform his or her pre-injury employment duties or any modified employment offered by the employer that is consistent with the employee’s disability”

The bill’s Sponsor states that A1118/S.768 will encourage employers to establish return to work programs and will ensure that permanently disabled workers with serious injuries are given the opportunity to return to work. In addition, the

Annette Malpica, Vice President, Director of Claims & Legal Counsel, Lovell Safety Management Co., LLC

sponsor states that current wage replacement for workers receiving temporary benefits is insufficient. This legislation would mark a fundamental shift in the definition of disability and the way in which wage replacement amounts are determined in New York State.

➢The bill upends the case law definition of a temporary total disability by allowingfor unlimited awards at the temporary total rate for employees with mild ormoderate partial disabilities. A1118/S.768 eliminates the longstanding tenet of theWCL that defines temporary total disability based on medical standards andcreates a new legal standard. Under the current system, when a doctor finds thatan employee has partially recovered from an injury, that employee must eitherseek out work that is commensurate with their degree of disability, or risk losingtheir indemnity benefits. The language of A1118/S.768 would make it so that if theinjured employees could not return to their pre-injury employment or to a modifiedjob, they would automatically receive benefits at the higher total disability rate. Thischange shifts the burden to the employer-carrier to either provide a light dutyprogram or face paying lifetime total disability awards until such time the employeereturns to work. The majority of employers don’t have the financial or practicalability to accommodate light duty. Since the inception of the WCL, the responsibilitywas placed on the partially disabled employee to seek work within the medicalrestrictions in any occupation to receive benefits at the partial rate.

➢ This bill would eliminate the labor market attachment requirements for employees with partial disabilities. Longstanding court precedents require that a partially disabled employee demonstrate attachment to the labor market by seeking work within his/her physical restrictions in order to receive ongoing indemnity benefits. Employees who are deemed to have a temporary total disability are naturally precluded from the requirement due to their designated “total” disability. Additionally, a yet unknown consequence presented by this bill is whether the employer-carrier would be mandated to continue total disability payments when a partially disabled employee, who is separated from employment, decides not to search for other employment within their physical restrictions.

➢ We are also concerned that this new definition of temporary total would undermine the durational caps of the 2007 reform legislation. The historic 2007 reform capped indemnity benefits under WCL §15 3(w) to a maximum of 525 weeks for employees who sustained partial loss of earning capacity based on the medical evidence and determinations of other industrial factors. Should this bill be signed, the door is opened for those employees who have medical evidence of a partial disability and are capable of gainful employment to continue to receive lifetime, tax-free, total disability awards. Ending durational limits on payment of partial disability benefits would result in very significant cost increases. 

➢ This bill could increase the protracted healing periods for employees with partial disabilities subject to schedule loss of use awards. The statute provides for additional weeks of compensation when the number of weeks of total disability exceeds the statute’s protracted healing period noted in WCL 15(4-a). Therefore, a partially disabled employee, who is unable to be accommodated in a light duty position will continue to receive total disability benefits, which in many instances will exceed the normal healing periods resulting in additional weeks of compensation added to the schedule award.

If signed into law, this bill would be effective immediately. The New York Compensation Insurance Rating Board has not yet calculated the cost of A1118/S.768. We did a random sample of 25 recent claims that featured temporary partial benefits. When we recalculated the cost of these claims at the temporary total rate, claims costs increased by 39%


Bill A2020-A/S.6373-B – Amends WCL §10(3)(b) to eliminate the case law requirement that mental stress injuries be based on work-related stress that is materially and substantially greater than that experienced by similarly situated workers.

“Where a worker files a claim for mental injury premised upon extraordinary work-related stress incurred at work, the board may not disallow the claim upon a factual finding that the stress was not greater than that which usually occurs in the normal work environment.”

Bill A2020-A/S.6373-B would expand the statutory carve out that applies to police officers, firefighters, and emergency medical technicians who filed a claim for mental injury premised upon extraordinary work-related stress to include all employees. The 2017 legislature, in recognition of the high standard required by the statute for mental stress claims, and the occupational hazards/exposure experienced by first responders during emergencies, removed the restriction that a mental stress claim had to be greater than the stress sustained by a similar worker. This bill will permit all employees who allege an extraordinary work-related stress to file a mental stress claim irrespective of a work-related emergency. The onus to determine what qualifies as “extraordinary,” a standard that is not defined by statute, will be placed on Law Judges. If passed, this bill will result in extensive litigation on the issue of what constitutes “extraordinary” stress, increase administrative expenses (IMEs, witness, and medical testimony) and result in compensability determinations on minor/transient stress events. If signed into law, this bill would be effective January 1, 2023. The New York Compensation Insurance Rating Board has not calculated the financial impact of this bill. We believe that in addition to increasing the cost of litigation, this bill would transfer the cost of treatment and disability for psychological conditions that are now not considered work-related to the workers’ compensation system. Given the fact that close to half of all Americans in surveys complain of stress, the cost could be substantial.

Bill A7178-A/S.8271A – Amends WCL §15 (6) by increasing the minimum amount of compensation from $150 to not less than 1/5 of SAWW or employee’s full wages if equal to or less than 1/5 of SAWW.

“[C]ompensation for permanent or temporary partial disability, or for permanent or temporary total disability due to an accident or disablement resulting from an occupational disease that occurs on or after the effective date…of two thousand twenty-two …shall not be less than one-fifth of the New York state average weekly wage except that if the employee’s weekly wages are equal to or less than one-fifth of the New York state average weekly wage, the employee shall receive his or her full wages.”

This bill would establish a new minimum weekly indemnity benefit for employees who sustained new accidents (on or after the date the bill is signed) and index future weekly minimum indemnity to the State Average Weekly Wage (“SAWW”). According to the sponsor’s justification memo, the “legislation would provide equity and fairness to low-wage workers injured on the job and ensure that future benefits are adjusted automatically with inflation.”

The current minimum weekly indemnity rate for employees who earn more than $150/ week is $150. This bill would establish an increased minimum weekly benefit rate for new injuries at 1/5 of the SAWW. Effective July 1, 2022, the SAWW will increase to $1,688.19 for injuries occurring on or after 7/1/2022 – 6/30/2023. Employees who sustain accidents after June 30, 2022, would be entitled to weekly indemnity benefits of no less than $337.64 (1/5 of $1,688.19) an increase of almost double the current minimum indemnity rate of $150/week. Employees with wages less than or, equal to $337.64/week would receive full salaries.

The impact of this bill will be felt by employers who hire large populations of low-wage earners, part-time, or seasonal employees. The significant increase in the minimum weekly indemnity rate, which is tax-free, may deter certain employees from returning to work. The increase in the minimum rate will also have an impact on the cost of workers’ compensation costs/premiums. The New York Compensation Insurance Rating Board has not yet priced the cost of this bill.

As of the date of this writing the legislation has not been delivered to the Governor for signature or veto. Those members interested in opposing the 2022 workers’ compensation legislation should immediately contact their legislative representatives or Lovell Safety Management at 1-800-5-Lovell.