Permanent Partial Disability benefits ("PPD") are benefits paid to an injured worker for a permanently disabling injury. The concept of PPD under the Worker's Compensation Act is inherently tied to concepts of permanent wage earning impairment.
Scheduled and Unscheduled Injuries
There are two kinds of PPD under the Worker's Compensation Act. PPD may be paid for "scheduled injuries," and PPD may be paid for "unscheduled injuries."
Scheduled injuries essentially involve the extremities. For those injuries, PPD is calculated based on the disability schedules set forth in sections 102.52 and 102.53 of the statutes. Theoretically, loss of earning capacity is built into the schedules, so an injured worker who has a scheduled injury is limited to the PPD set forth in the schedules and is not entitled to make a loss of earning capacity claim.
Example: A worker receives a PPD rating of 10% at the level of the right elbow. The schedules provide that the total loss of an upper extremity at the level of the elbow is equivalent to 450 weeks of PPD benefits (Sec. 102.52(2), Wis. Stats.). The worker is entitled to 45 weeks of PPD benefits [450 x 10% = 45].
Unscheduled injuries essentially involve the trunk of the body and head. PPD for those injures is calculated on the basis of the body as a whole, which is 1000 weeks of benefits. Because loss of earning capacity concepts are not already built in as they are with the scheduled injuries, an injured worker who has an unscheduled injury is entitled to make a loss of earning capacity claim.
Example: A worker receives a PPD rating of 10% to the body as a whole for a low back injury. The worker is entitled to 100 weeks PPD benefits for the functional PPD rating [1000 x 10% = 100]. Now assume this worker also does not return to the time of injury employer, and a vocational expert states the worker has sustained a 15% loss of earning capacity. The worker is entitled to 150 weeks of PPD benefits. Note the loss of earning capacity is not in addition to the functional PPD; rather, in this case the 10% functional PPD is subsumed within the 15% loss of earning capacity. A total of 150 weeks of benefits is owed.
Administrative Code Minimum Ratings
Some injuries are subject to the minimum PPD ratings set forth in the Wisconsin Administrative Code. The code minimums are based on the nature of surgical procedures or other factors such as loss of motion. As an example, a worker who has had a lumbar fusion is entitled to PPD of 10% to the body as a whole (Sec. DWD 80.32(11), Wis. Admin. Code). That assumes the worker had a good result from the surgical procedure. The minimum PPD ratings set forth in the code may be graded upward depending on the presence of additional disabling factors.
The preamble to the section of the administrative code setting forth the minimum ratings states: "The disabilities set forth in this section are the minimums for described conditions. However, findings of additional disabling elements shall result in an estimate higher than the minimum. The minimum also assumes that the member, the back, etc., ww previously without disability. Appropriate reduction shall be made for any preexisting disability."
Multiple Disabilities
When an injury results in more than one permanent disability, the PPD for each additional equal or lesser disability is subject to a multiple injury factor. Generally, each additional or lesser disability is increased by 20%; although, there are special rules for disabilities on the same hand, disabilities on the same foot, and injuries which involve the impairment of both eyes.
Further, the administrative code provides that PPD for more distal injuries is subtracted from the number of weeks in the schedule for more proximal disabilities or the number of weeks for the body as a whole before the number of weeks for the more proximal disability is calculated (Sec. DWD 80.50, Wis. Admin. Code).
Example: If a worker has a PPD of 10% to the body for a low back injury and a PPD rating of 10% at the right elbow, the PPD at the elbow, the more distal injury would be calculated first. That is 45 weeks. The 45 weeks would then be subtracted from 1000 weeks of benefits for the body as a whole, leaving 955 weeks for the body as a whole. Then, the 10% rating to the body as whole would be applied, and that works out to 95.5 weeks of benefits. Finally, the 20% multiple injury factor would be applied to the lesser disability [45 x 20% = 9 weeks]. The total of the disability ratings is 149.5 weeks of PPD benefits [45 + 95.5 + 9].
PPD Caused by Other Factors
There are a number of components of the Worker's Compensation Act that point to the intention on the part of the legislature to limit an employer's liability to PPD caused as a result of employment with that employer. One such provision is in Wisconsin Statute Section 102.175(3)(a) which states that if it is established that an injured worker has sustained permanent partial disability:
[B]ut that a percentage of that disability was caused by an accidental injury sustained in the course of employment with the employer against whom compensation is claimed and a percentage of that disability was caused by other factors, whether occurring before or after the time of the accidental injury, the employer shall be liable only for the percentage of permanent disability that was caused by the accidental injury.
Thus, for cases involving "accidental injuries," as opposed to occupational disease, PPD may be apportioned between disability for the work-related injury and these "other factors."
PPD Benefit Rate
PPD benefits are paid at 2/3 of the average weekly wage; however, the benefit is capped at the level established by the state. Both TTD and PPD benefits are paid at 2/3 of the average weekly wage, but PPD benefits are capped at a lower rate. The maximum PPD benefit for injuries occurring in 2024 is $430 per week.
PPD Red Flags
■ We are finding that DWD is taking an increasingly aggressive role in interpreting the code minimums set forth in DWD 80.32 in ways that favor the employee. In some cases, challenging DWD's interpretation of the code minimums may be warranted.
■ When you receive a PPD rating, it is a good idea to evaluate that rating in comparison to the code minimum provisions set forth in DWD 80.32. That might provide guidance in determining whether an IME is required or would be helpful to address a treating doctor's PPD rating.
■ Quite often claimant attorneys will look at the potential for establishing an unscheduled injury in cases that otherwise would only involve scheduled injuries. Because loss of earning capacity may not be pursued in a scheduled injury case, there may be a great financial incentive for the claimant to establish an unscheduled injury. Worker's compensation insurance claim representatives should be sensitive to this. As examples, if a worker with an upper extremity injury starts treating for spinal issues, or if a worker with a knee injury starts treating for a psychological problem, such developments merit close scrutiny.
Note:
Despite the straightforward-appearing framework for calculating PPD, the issue in some cases can be complicated. If you have questions about a PPD rating in a particular case, please feel free to contact us to discuss it.