In this continuing series about the open and active phase of a workers’ compensation claim, today I am going to discuss a benefit many injured workers are surprised to learn exists: Loss of Earning Power benefits. Earning power refers to a worker’s ability to earn income as a result of labor. If an injured worker’s ability to earn income has been reduced because of an industrial injury or occupational disease, the worker may be entitled to LEP benefits under the claim. However, for LEP to be payable, two conditions must be met: (1) The injured worker’s loss of earnings must be greater than 5% of wages at the time of injury; and (2) Medical certification must indicate that the worker’s loss of earning capacity is due to the industrial injury or occupational disease.
If an injured worker is unable to work in any capacity, they should receive time-loss compensation benefits, not LEP. LEP is appropriate when an injured worker can perform some work, but not at the same wage-earning capacity. Common scenarios where LEP may apply include when injured workers cannot work a full-time schedule and are on reduced hours following the injury or disease, or when an injured worker can return to a lighter or more sedentary job that pays a much lower salary than their job of injury.
If you have an open and active claim but have returned to work and think LEP benefits may apply, you can use the online calculator on the Department of Labor and Industry (L&I) website to determine if you should receive LEP. You can also view how much you should receive. If LEP benefits are appropriate, it is important for the injured worker to apply for the benefits to be paid. If there is a medical basis for LEP benefits, the application requires information from the injured worker, the attending physician, and the current employer. However, in lieu of having a current employer complete that portion of the application, an injured worker may attach pay stubs outlining their current salary and hours worked for LEP calculation purposes. If the basis for the LEP is vocational in nature, the application requires information from the injured worker, the current employer (or pay stubs), and the assigned vocational counselor.
When a valid application for LEP benefits has been submitted, payments should typically be made on a regular bi-weekly or semi-monthly payment schedule. As a rule of thumb, I usually suggest that injured workers who are eligible for LEP continue to see their attending medical provider on a monthly basis so that updated LEP forms can be completed and submitted. If the basis for LEP benefits is vocational, the application can be submitted on a schedule consistent with pay periods for the current employment.