Are there differences in workers’ comp laws between states?

A couple months ago, NPR did an extended investigation and report on the inequities that can come from hurting oneself at work, especially when comparing states (as each state has its own body of workers’ compensation law).  Below is a summary of that report from our summer intern, Sophie Frostbaum:

One may think that an arm is an arm and a leg is a leg, right? Wrong! Jeremy Lewis, a 27-year-old man living in Alabama, and Josh Potter, a 25-year-old man living in Georgia share a lot in common with one another. They are both married with two children around the same age, both work at Southern industrial plants about seventy five miles away from each other, and both of them lost a portion of their left arm in tragic machinery accidents.

These two men seem to be in quite similar situations, right? Wrong again! Despite the fact that these two men seem to be living nearly identical lives, Lewis only received $45,000 in workers’ compensation for losing a great portion of his left arm, whereas Potter has received benefits so great that he could receive over $740,000 throughout his lifetime.

This seems comparatively unjust, considering two extremely similar incidents occurred, however, because Lewis lives in Alabama, which gives out the nation’s lowest workers’ compensation benefits, he is receiving an exceedingly miniscule amount of money. Potter, on the other hand, is quite lucky to be living across the border in Georgia, because they are a pretty generous state in the case of workers’ compensation benefits with catastrophic injuries.

The nearly innumerable difference in benefits between Lewis and Potter is a prime example of the geographic lottery that regulates compensation by state for workplace injuries in America. Thanks to congress, each state has the privilege of determining its own benefits. There are no minimums put in place by the government, therefore, identical injuries can receive completely different benefits based on the location at which they occurred. Almost all states have a “schedule of benefits” that says the supposed price for a lost body part. For example, a lost arm in Alabama is worth up to $48,840, whereas in Illinois, a person may receive up to $439,858.

The huge difference in award of benefits per state for the loss of a body part is in a sense dehumanizing. Why should someone living in Alabama not only be punished by the loss of an arm, including their ability to perform simple daily routines, but also lose their ability to provide for their family? For a man like Jeremy Lewis, only 27 years old with two young children, $45,000 will not get him too far, and without an arm, he will struggle to get back on his feet, and find work again.

My workers comp firm and I know that it is unfortunate that in 2015, employers are paying the lowest workers’ compensation rates since 1970. These miniscule benefits have torn the Lewis family apart; he lost his house, three new vehicles, and after foreclosure, is living in an old trailer with his family. For people like Jeremy Lewis, an arm is not just an arm.

Note:  shortly after this story ran on NPR, Alabama’s legislature considered a bill to increase its workers’ compensation benefits for injured workers, though its passage is considered unlikely.