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Limitations on Workers' Compensation Benefits  

By: J. Steven Collins
steve@bcnattorneys.us


The Tennessee Workers' Compensation Law contains a provision which limits benefits to employees who suffer a permanently and totally disabling injury after age 60 to 260 weeks. Tenn. Code Ann. § 50-6-207(4)(A)(i). Another portion of our Tennessee Workers' Compensation Law, however, provides that workers who sustain injury to a non-scheduled member (a body as a whole case) resulting in permanent partial disability are entitled to benefits up to 400 weeks, depending upon the amount of industrial disability sustained. Tenn. Code Ann. § 50-6-207(3)(F). Typical examples of body as a whole injuries are injuries to the back, neck or shoulder.

 
A literal reading of the two statutes could result in an over age 60 worker who was permanently and totally disabled receiving less benefits than an over age 60 worker who was permanently and partially disabled. This statutory conflict was resolved in the case of Vogel v. Wells Fargo Guard Services, 937 S.W.2d 856 (Tenn. 1996). The Tennessee Supreme Court's opinion in Vogel left several other questions concerning benefits for over age 60 workers undecided.
 
This article reviews the Vogel decision and also addresses several other issues concerning benefits for over age 60 workers which have now been resolved in the Tennessee court system.
 
Specifically, the issues addressed in this article are: 
  • Permanent total disability benefits for over age 60 workers;
  • Permanent partial disability benefits for over age 60 workers;
  • Benefits for scheduled member injuries for over age 60 workers;
  • Calculation of benefits for over age 60 workers who are limited to a recovery of no more than 260 weeks of benefits;
  • Determination of when the employer receives a credit against its workers' compensation liability for the worker's social security retirement benefits;
  • Calculation of the employer's credit for the worker's social security retirement benefit; and
  • Benefits for workers who are within 400 weeks or less of reaching their 65th birthday but who are not yet 60 years of age. 
Permanent total disability for over age 60 workers
 
A worker is permanently and totally disabled when a body as a whole injury "totally incapacitates the employee from working at an occupation which brings the employee an income." Tenn. Code Ann. § 50-6-207(4)(B). Generally, benefits for permanent total disability are paid "until the employee is, by age, eligible for full benefits in the Old Age Insurance Benefit Program under the Social Security Act" (65 years of age). Tenn. Code Ann. § 50-6-207(4)(A)(i). With the anticipation that a worker will receive social security retirement at age 65, the Tennessee General Assembly limited benefits to over age 60 workers suffering permanent total disability to 260 weeks which is the equivalent of five years. Id.
 
Permanent partial disability benefits for over age 60 workers
 
The constitutionality of limiting permanent total disability benefits for body as a whole injuries to over age 60 workers was addressed in Vogel v. Wells Fargo Guard Services. The Tennessee Supreme Court found that the General Assembly's limitation of 260 weeks of benefits for over age 60 workers was constitutional.
 
The Vogel court, however, determined that the 260 week limitation of benefits had to be extended to permanent partial disability as well as permanent and total disability in order that the entire legislative structure be rational and thus constiutional. The court reasoned it would be "irrational" if a partially disabled worker over age 60 received more in benefits than a worker over age 60 who was permanently and totally disabled. The Vogel court said it would not assume the Tennessee General Assembly would enact a law which would create an irrational result. Hence, after the Vogel case, workers who are over age 60 when they suffer a body as a whole injury will receive no more than 260 weeks of benefits for permanent partial disability.
 
Benefits for scheduled member injuries for over age 60 workers
 
Certain types of injuries are categorized as "scheduled members." The Tennessee Workers' Compensation Law provides specific maximum benefits for scheduled member injuries. Tenn. Code Ann. § 50-6-207(3)(A)(ii)(a) through (ff). The maximum number of weeks available for scheduled member injuries range from a low of ten weeks for loss of a toe, "other than the great toe," to a high of 400 weeks for loss of two hands, two feet, two arms, two legs, both eyes or complete loss of mental faculties.
 
It can thus be seen it is possible for an over age 60 worker to suffer a scheduled member injury which provides for benefits in excess of 260 weeks. After the opinion in Vogel, this potential anomaly raised the issue of whether the 260 week limitation for over age 60 workers permanent total and permanent partial body as a whole injuries would be extended to scheduled member injuries. This question was answered in McIlvain v. Russell Stover Candies, Inc.. 96 S.W.2d 179 (Tenn. 1999). The Supreme Court in McIlvain held that there would be no 260 week limitation on over age 60 workers' benefits for scheduled member injuries. The Court reasoned that even though some workers with scheduled member injuries who were over age 60 could receive benefits greater than permanently and totally disabled over age 60 workers, such a result would not be irrational because the Tennessee General Assembly had enacted specific statutes to govern scheduled member injuries. Hence, over age 60 workers are treated the same as all other workers for purposes of scheduled member injures.
 
Calculation of benefits for over age 60 workers who are limited to a recovery of no more than 260 weeks of benefits
 
The specific issue recently addressed in the Tennessee Supreme Court opinion in Peace v. Easy Trucking Co., 38 S.W.3d 526 (Tenn. 2001) was whether awards of permanent partial disability to the body as a whole for workers over age 60 should be calculated as a percentage of 400 weeks with a cap at 260 weeks or whether such awards should be calculated as a percentage of 260 weeks. The Supreme Court decided the proper calculation for permanent partial disability awards for over age 60 workers would be as a percentage of 400 weeks until that percentage equaled or exceeded 260 weeks at which point it would be capped. The result of this holding is that an over age 60 worker who sustains a vocational disability equaling or exceeding 65% will receive the same 260 weeks of benefits as an over age 60 worker who is permanently and totally disabled (400 x .65 = 260). 
 
The court in Peace concluded the Vogel opinion did not require the calculation of a permanent partial disability award for an over age 60 worker to be based on a percentage of 260 weeks to avoid an irrational result. The court pointed out its concern in Vogel was to avoid a result whereby an over age 60 worker who was permanently and totally disabled received less than an over age 60 worker who was permanently and partially disabled. Under the holding in Peace a permanently totaly disabled over age 60 worker will never receive less than an over age 60 worker who is only permanently and partially disabled. The court further stated its decision was motivated by the desire to avoid "a result which reduces benefit awards to disabled employees any more than is necessary to preserve the rationality of the Workers' Compensation Act."
 
Determination of when the employer receives a credit against its workers' compensation liability for the worker's social security retirement benefits
 
The provision of the Tennessee Workers' Compensation Act which provides the employer with a credit for part of the employee's social security retirement benefit specifically addresses itself to permanent total disability cases. The Tennessee Supreme Court, however, has extended the availability of the credit to employers in permanent partial disability to the body as a whole claims. See, McCoy v. T.T.C. Illinois, Inc., 14 S.W.3d 734 (Tenn. 2000). Not surprisingly, the offset for the worker's social security retirement benefit is not available to the employer in scheduled member cases. See, McIlvain supra.
 
Calculation of the employer's credit for the worker's social security retirement benefit
 
The McCoy opinion also teaches us how to calculate the offset for social security retirement benefits. To calculate the offset, one-half of the value of the weekly social security benefit is subtracted from the employee's weekly workers' compensation benefit rate. The employee is then paid the difference. The plaintiff in McCoy argued the offset should be limited to only the amount of the social security benefit which could be traced to the contributions of the employee's employer when the injury occurred. The court rejected this argument. The offset is for the value of one-half of the social security retirement benefit.
 
Note the calculation for the social security offset may have to be made several times because an individual's social security retirement benefit, unlike the weekly workers' compensation benefit, is not static. For example, the plaintiff in McCoy was awarded benefits for a 45% disability to the body as a whole. This award equated to 180 weeks or approximately three and one-half years of benefits. Because the plaintiff's social security retirement benefit had increased each year since maximum medical improvement the court separately calculated the offset for each year of the accrued benefits in question.
 
Benefits for workers who are within 400 weeks or less of reaching their 65th birthday but who are not yet 60 years of age
 
The attempt of the Vogel court to avoid irrational results due to the conflict between the Act's permanent total disability statute and permanent partial disability to the body as a whole statute, led to an issue concerning benefits for workers within the age window of 57 years and 16 weeks and 60 years of age. Workers within that window are 400 weeks or less from their 65th birthday.
 
In Tucker v. Foamex, L.P., 31 S.W.3d 241 (Tenn. 2000) the issue which confronted the court was whether Tenn. Code Ann. § 50-6-207(4)(A)(i) should apply to a worker who is not over age 60 but who is within 400 weeks of his or her 65th birthday when they sustain a permanent partial disability. The court refused to extend the rationale of the Vogel case to such workers. Accordingly, workers within that window of age who sustain permanent partial disability to the body as a whole will receive awards based upon the percentage of vocational disability multiplied times 400 weeks with no 260 week cap. In so holding, the court expressly recognized that "under our holding some employees could receive a larger award for a permanent partial disability to the body as a whole than they would receive if they were found to be permanently and totally disabled." Even so, the Tucker court would not extend the rationale of Vogel stating that "to do so effectively would require us to rewrite the statute and would substantially limit, without clear statutory authority, benefits to many partially disabled workers between the ages of 58 and 60."
 
Conclusion
 
Since the issuance of the opinion in Vogel in 1996, numerous questions concerning benefits for over age 60 workers have been answered. We now know:
 
  • Workers who are 60 years of age or older when they sustain a body as a whole injury will receive no more than 260 weeks of disability benefits whether their injury renders them partially disabled or totally disabled.
  • Workers over age 60 who suffer a scheduled member injury will be compensated based upon the scheduled member statute with no 260 week limitation.
  • When the 260 week limitation is applied to over age 60 workers who have sustained a permanent partial disability to the body as a whole, the calculation for the award is based upon the percentage of vocational disability times 400 weeks and the employee receives an award commensurate with the product of the calculation but the award is "capped" or limited to 260 weeks. The result is that an over age 60 worker receiving at least a 65% vocational disability to the body as a whole will receive as much as an over age 60 worker who sustains a permanent total disability.
  •  The credit for the employee's social security retirement benefit is applicable whether the worker sustains a permanent partial disability or a permanent total disability to the body as a whole.
  • The credit based upon the employee's social security retirement benefits is not available if the injury is to a scheduled member.
  • The credit is calculated by determining the value of one-half of the employee's weekly social security benefit which is then deducted from the weekly workers' compensation benefit rate and the employer pays the difference.
  • Workers who are within 400 weeks of their 65th birthday but are not yet 60 years of age receive compensation for permanent partial disability to the body as a whole based upon a percentage of 400 weeks with no 260 week cap even though that may mean in some instances a permanently partially disabled worker may receive more than a worker over age 60 with a permanent and total disability.


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