Is inflation slowing down? At least when it comes to wage growth in Nebraska, the answer looks to be yes. For injured workers in Nebraska or covered by Nebraska workers compensation, this means maximum benefit rates will rise less in 2023 than in 2022.
The maximum wage benefit rate for workers injured in 2023 who are covered by the Nebraska Workers Compensation Act will rise to $1029 per week from $983.00 in 2022. That is a 4.68 increase down from a t 7.5 percent increase last year.
Under the Neb. Rev. Stat 48-121.01 the maximum benefit rate shall be 100 percent of the state’s average weekly wage as determined by the Nebraska Department of Labor. The Governor has the power to suspend the increase under law, but has never exercised that power.
On an individual level, any worker making more than $80, 263 per week exclusive of overtime premium will be undercompensated by under Nebraska law.
Inflation and loss of earning power evaluations
The annual increase in maximum benefits is always a good reminder for me that while maximum benefits increase in Nebraska -which doesn’t happen in every state- benefits aren’t indexed for inflation.
I’ve written about case law where other states have taken wage inflation into consideration to benefit injured workers. Back injuries and injuries involving multiple members are paid on a so-called loss of earning power basis. Typically in an injury that involves a loss of earning power, treatment and recovery can take 18 months to two years.
But when a worker gets done treating and their loss of earning power determined they are stuck with the wage rate at the time of the injury. But their employer gets the benefit of wage inflation when loss of earning power gets determined. Average wages in Nebraska have increased by 12.58 percent since 2021. So employers can argue that the employee can earn X amount per hour or week when that number should really be decreased for inflation.
Employees also run into evergreen arguments about Nebraska having a labor shortage which usually serves to push down loss of earning power numbers. All the more reason to push the inflation argument.
Inflation arguments and vocational rehabilitation
While knee and shoulder injuries are not paid on a loss of earning power basis, they can be as disabling as back and hip injuries. Particularly for higher-wage workers, vocational rehabilitation can be an option for knee and shoulder injuries. Vocational rehabilitation or re-training is an option when an employee can not return to a job with similar pay. Put another way, it’s a similar test to loss of earning power. So arguments about inflation could help an injured worker gain eligibility for vocational rehabilitation.