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What is a Permanent Disability Award?

Workers’ compensation lawyer Scott Schulman explains what a permanent disability award is and who qualifies.

Video Transcript:

Petrillo: What I think are the third type of workers’ comp benefits in New Jersey. The term I’ve heard many time is permanency or permanent partial of total disability. What in the world does that mean?

Schulman: Yes. Well, we generally use the phrase permanent disability award in workers’ compensation, and sometimes people get confused, understandably. Permanent disability does not mean that you can never work again. It doesn’t mean that you are permanently restricted from working. It just means whatever that injury that you have, and sometimes people have multiple body parts that are injured, but those injuries are permanently affected. You have a permanent loss of function of that body part.

So that will affect your ability in the future, potentially for the rest of your life. But that doesn’t mean that you can’t return to work or can’t go back to work in some fashion. So the permanent disability benefits which we discussed earlier, the three benefits, the medical treatment, the lost wages, and then the permanency benefits, myself will have you evaluated by one of my doctors to combat an evaluation that the insurance company will use with one of their doctors to assess what your permanent injury is to that body part. That’s when we use the word permanent disability.

Once we get those examinations, generally my doctor’s going to have a high percentage of disability in their doctor, the insurance company doctor, is going to have a low percentage of disability. The real number generally is somewhere in the middle there. And as a range, depending on what the type of injury is including such factors as, did that person have surgery? Did they not have surgery to that body part? Are they able to go back to doing that same type of job that they were doing before they were injured?

Petrillo: So what you’re saying I think is that in addition to the authorized medical care and coverage, in addition to the temporary disability benefits until the worker gets back to work, they’re entitled to a third benefit. They’re entitled to a money award for the partial permanency?

Schulman: Yes. And that’s-

Petrillo: Tell me about that. How do you figure that out?

Schulman: And that’s what I said. Weighing the two doctors’ examinations, our doctor and their doctor. The factors that will determine to us the level of the permanent injury to that body part based on did they return to work at the same job? Are they no longer able to do that type of job anymore? They may have a heavy construction-type job, and they may have had back surgery, and they can’t do that heavy lifting anymore.

So it doesn’t mean that they’re not able to work on a permanent basis. It just means that they can’t do that type of job. So they will have to, hopefully, be able to find a different lighter-type job. Then there’s other factors that occur sometimes based on the person’s age, education level, past experience and work history, they may not be able to return to any type of job at all. That will result in total disability benefits, meaning that they can never work again.

Petrillo: Okay. But before we get to that, here’s my question. If it is a partial disability situation where the injured worker is able to go back to work, but has some partial disability, I’ve heard this concept in workers’ comp in New Jersey of the body, the whole man, the statutory arm, the statutory hand, the statutory foot, the statutory leg. What in the world is that all about?

Schulman: Yes. Well in New Jersey, and I know in other states it’s different, in Pennsylvania I know it’s different, and sometimes we have some overlap with people that may work in both states and get injured. But in New Jersey for the permanent disability benefits, there are charts that we use based on your injuries. Whether it is an injury to the arm, which is from your shoulder down.

Whether it’s an injury to your hand, which is from the elbow down. Someone that may have an injury to their shoulder or shoulder surgery, that’s of the whole body so to speak. Those injuries would include head, neck, back, shoulder-type injuries, chest injuries. Someone may have a knee injury. That’s considered part of the leg.

Petrillo: How about the hip?

Schulman: The hip is considered the total body, the full body.

Petrillo: So it’s basically anything on the torso is the whole person.

Schulman: Right, and the benefits go on a graduated basis so to speak. Your lesser compensated injuries, based on the chart, are your foot, your toes, your fingers. Then it goes to your feet and your hands. Then it goes to your arm and your legs. Then the injuries that are compensated the highest in terms of money for permanent disability would be the partial total injuries, the trunk or torso of your body.

Petrillo: Right. Now, I also understand that there’s a weighting in New Jersey workers’ comp in terms of the severity. That under these charts that you talked about the lesser injuries tend to get lesser, but as the injury progresses, as the percentage increases, the nature or the rate of benefits actually increases. Can you explain that?

Schulman: Yes. Based on the charts that we use, that the New Jersey legislature has enacted, and they’ve been using these charts with New Jersey workers’ compensation for over a hundred years now. The system is not perfect but it does work pretty well. The lesser injuries you’re going to get money. You’re going to get some money, but you’re not going to get a lot of money. As you progress higher up the permanent disability for any of the body parts, the numbers are going to increase.

As you progress higher up in the numbers, for instance, a neck, back, shoulder surgery injury circumstance, those numbers start to exponentially increase the higher they get. Generally, the cutoff level is 30% disability. What my job is when I have a case that is hovering that 30%, sometimes it may be just below or just above, if the circumstances warrant and dictate I will kick, scream, and fight, to try and get the injured worker above 30% because the numbers increase dramatically when you do that.

Petrillo: Now, I understand there’s actually a nickname for that.

Schulman: Yeah, it’s called over the hump.

Petrillo: Over the hump. Right.

Schulman: So that’s what we try and do. Likewise, while I’m fighting to get the numbers over the hump, the insurance company’s fighting to keep the numbers under the hump. And sometimes there’s other circumstances just besides the actual injury. There are lifestyle events, lifestyle restrictions that this injury has caused. They may have lost their job. They may not be able to make that same type of money anymore. Those will be factors that the judge will consider in deciding whether the case goes over the hump or stays under the hump.

Petrillo: Sure. Sure. Okay. Now, so the bottom line is, when you’re talking about permanent partial total disability, the more severe the injury is, the higher percentage of the award is going to be if it gets over the hump over the 30% rule?

Schulman: Right.

Petrillo: Okay. Next question. How about when there’s total permanency, when the person can’t go back to work at all? What happens then?

Schulman: Well, what happens then is a couple different options. If you’re totally disabled and you’re not able to work in any capacity, and sometimes the injuries are so extensive and horrific that it’s apparent to everyone, myself, the defense attorney, and they’ll just say, “Yeah.” After some fighting, and kicking, and screaming, they’ll eventually realize that they’ll look foolish trying to say that the person is not totally disabled. In that circumstance if you’re deemed to be totally disabled, you will get benefits essentially for the rest of your life. You will get medical benefits. Sometimes people can need continuing benefits, medication, follow-up with doctors, with pain management doctors to prescribe the medications for the rest of their life. The insurance company’s responsible to provide that.

On top of that, since you’re not able to work, you will get monetary benefits for the rest of your life as well. Sometimes there are success stories where people may be determined to be totally disabled, and they may be rather young and they don’t like not doing anything. They want to be a productive member of society. And sometimes people will be able to train themselves to do something, or they will be able to fight through the pain and want to go back to work and get some sort of job that they’re able to do with their injuries.

Petrillo: Do they lose their benefits, their total benefits?

Schulman: They’re required to notify myself and/or the insurance company. The insurance company certainly wants to enable them to go back to work because yes, their benefits will stop. They are entitled to some sort of minimum amount of benefits on a weekly basis while they do go back to work. But the insurance company is still responsible for the medical treatment. And if for some reason down the road their condition should worsen, they would be able to get back out of work and get back onto the weekly benefits.

Petrillo: Right. Now, I understand that obviously when it’s a disputed total disability case, the insurance companies there’s a lot at stake and they fight those cases very hard. But I understand there’s also a means or a mechanism in New Jersey called the Second Injury Fund. I assume you’ve heard of that many times.

Schulman: Yes.

Petrillo: Could you explain to our viewers what that is, what it means, and why it’s a helpful tool to you as a seasoned veteran workers’ comp attorney in New Jersey?

Schulman: Yes. Well, that is involved with someone we argue is totally disabled. They would have a significant injury, and the employer is disputing that they’re totally disabled. What happens is, they may have a significant injury but they may also have prior injuries as well, prior conditions. It could be from injuries from prior work-related job injury, or outside of a job injury, or it could be just a personal medical condition that they may have. It may be diabetes. It may be some other circumstance.

And when you combine the work-related injury in conjunction with their preexisting injuries and/or conditions, and the combination of all of those injuries and conditions prevent that person from legitimately working on a full-time basis at any sort of job, that is what I attempt to pursue to get the total disability benefits. How that works is, the Second Injury Fund is through the state of New Jersey. So what I end up doing is, we file a petition for the Second Injury Fund benefits, and I end up having to fight with two adversaries. Two defense attorneys on the other side.

One from the state, and their motivation is not to pay out any money. The other one from the insurance company, and their motivation is to pay out money but on a partial total basis, not on a total disability basis. Oftentimes those cases take a lot of time because then I have to go back and get the prior medical records and prove why as a combination everything would prevent this injured worker from working at all. Oftentimes I’m successful at that. Then the injured worker gets benefits not only from the insurance company for a period of time, and then when those benefits from the insurance company stop, then the Second Injury Fund kicks in and they provide benefits for the remainder of their life.

Petrillo: So if I understand it correctly, if you’re successful in a Second Injury Fund application, both the workers’ comp insurance company and the state of New Jersey combine to pay the total award.

Schulman: That’s correct. Yes.

Petrillo: Okay. All right. Now, how about in situations where someone has a preexisting injury, then gets hurt at work, but they’re not totally disabled. I remember the term Abdullah Credit. Why don’t you explain, if you would, for our viewers what that means?

Schulman: Yes. Abdullah Credit, that’s based on a case name, an individual’s name. Last name was Abdullah that had a case. There was a legal dispute. Then it went up to the appellate division and the supreme court, and so that’s how we refer to it. But what it means basically is, someone may have had a bad back, an injury before this. Could have been at work, could have been outside of work. If they injured the back at work and got a prior award, and then they had a new injury to the back, and let’s say as a result of the second injury to the back, they then needed surgery to their low back, they would be entitled to benefits and workers’ compensation.

However, the insurance company would not pay the benefits for the full rate of disability after the surgery to the back. They would get a credit for the preexisting injury or preexisting award or condition to the back, and they would just pay the difference from the prior condition to the current condition after the low-back surgery, and that’s-

Petrillo: But here’s my understanding. As a practical matter, where someone has a preexisting injury, and goes to work and suffers another injury on top of that, the Abdullah Credit it pushes up the entire value of the case. But the lesser injury is typically rated at the lower rate. So many times the value of the Abdullah Credit, the person who has a preexisting injury, the actual value of the case can be more than someone who doesn’t have a prior injury. Have you experienced that?

Schulman: Yes, that happens a lot. That goes back to especially depending on the injury or the body part that’s injured. More oftentimes with the shoulder, the neck, the back. If there’s a preexisting injury, there’s a credit. And what my job, or what I want to try and do in the appropriate circumstance is, push that new value over the hump, over 30%. So the person will get a lot more money. The injured worker will get a lot more money for being over the hump. And there’ll be a credit that the insurance company gets, but that money will be substantially lesser than the overall award.

Petrillo: So there’s a lot of armaments in your tool chest to wage your war.

Schulman: Yeah. There’s many things to think about and consider in every case, based on the circumstance.

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