What Iowa’s new workers’ compensation changes mean

Iowa’s workers’ compensation system will see some significant changes on July 1, under a bill signed into law by Gov. Terry Branstad in March.

Following are the changes employers are most likely to notice:

  • Pre-existing conditions
    Employers will now only be liable for the portion of an employee disability related directly to an injury that occurred at their organization. This is referred to as “apportionment,” and it prevents the employer from being held liable for portions of a disability caused by work injuries at previous employers or other pre-existing injuries.
  • Shoulder injuries
    The law provides for retraining at community colleges for certain employees who cannot return to employment due to shoulder injuries. It also adds the shoulder as a scheduled body member, meaning the amount of compensation due an employee who sustains a work-related shoulder injury is spelled out by law.
  • Intoxication
    If an employee tests positive for drugs or alcohol at the time of a work injury or immediately after, the burden of proof will be on the employee to show that he or she was not intoxicated at the time of the injury.
  • Notice of injury
    In order to receive workers’ compensation benefits, the law will require injured employees to notify their employers within 90 days from the date they are injured, which the law defines as the date they “knew or should have known that the injury was work-related.”
  • Interest rates
    Interest rates on workers’ compensation awards will change from a fixed 10 percent to the Federal Reserve’s one-year treasury constant plus 2 percent.
  • Permanent partial disability
    Under the new law, permanent partial disability payments won’t be made until the injured employee reaches maximum medical improvement, and doctors’ permanency ratings will be based on American Medical Association guidelines. Currently, payments are made prior to maximum medical improvements, and so the ratings are estimates.

One of the more controversial provisions of the bill was ultimately dropped — a provision that would have cut off permanent total disability payments at age 67.

Photo of Iowa Gov. Terry Branstad by Rich Koele / Shutterstock.com

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

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