By: Angie Zinzilieta, Partner
You may have heard that workers’ compensation settlements work differently than a personal injury lawsuit settlement. In Illinois, workers’ compensation settlements work require some math. The following post is based on Illinois workers’ compensation law. Each state has its own laws and rules concerning workers’ compensation cases.
WC workers’ compensation
AWW average weekly wage (This is the average amount you were making for the 52 weeks prior to your workplace injury.)
TTD total temporary disability (This is similar to an unemployment payment. In Illinois, this amount is 2/3 of your AWW.)
PPD permanent partial disability (This is typically what is considered your WC settlement. Employers are required to pay PPD benefits to injured workers suffering from an amputation, physical impairment, or disfigurement caused by job-related injuries, but is able to perform work at some level.)
PTD permanent total disability (A complete disability that leaves an employee permanently unable to do any kind of work for which there is a reasonably steady job market. PTD benefits entitle an employee to a weekly benefit of two-thirds of their average weekly wage, subject to certain minimum and maximum limits, for life.)
In Illinois, your PPD is calculated as follows:
(60% of AWW) X (Value of Body Part)(% of Disability) = PPD
The percentage of disability is based on any residual effects of your workplace injury. For
example, you may have limited range of motion or permanent restrictions, or you may be
unable to do activities that you were able to do before your injury.
The “Body Part Value Charts” are below:
EXAMPLE OF HOW A WC SETTLEMENT WOULD BREAK DOWN:
Sandy injured her back carrying a large package from her delivery van to a customer's door. Sandy went to the doctor and was diagnosed with a disc injury. Ultimately, after physical therapy and epidural injections, Sandy was required to have a disc replacement surgery. Sandy can no longer bend repetitively or lift more than 30 pounds, and her spinal surgeon has placed her on permanent restrictions prohibiting such. In all, we believe that Sandra has suffered a PPD of 40% Body as a Whole. In the year prior to her injury, Sandy made $1,000 per week before any taxes, insurance, 401(k), etc., were taken out.
What is Sandra's AWW? Sandra's AWW is $1,000.
What is Sandra's PPD rate? 500 weeks X 40% = 200 weeks
How much would Sandra's PPD award be? 200 weeks X ($1,000 X 60%) = $120,000
In Illinois, attorney's fees are capped at 20%. So, if Sandra received a PPD award for $120,000, then the attorney's fees would be $24,000.