The Connecticut General Assembly

OFFICE OF LEGISLATIVE RESEARCH

April 17, 1997 97-R-0614

TO:

FROM: Judith S. Lohman, Principal Analyst

You asked for a comparison of workers' compensation benefits in Connecticut and Massachusetts, New Jersey, New York, and Rhode Island.

SUMMARY

Although generalizations are somewhat difficult, a comparison of workers' compensation benefits in Connecticut with those of the four surrounding states shows that Connecticut's benefit rates are the same or lower than those of the other states but that the maximum benefits in Connecticut tend to be higher. This report compares benefits available in the five states in four major categories: total disability, fatality, permanent partial disability, and scarring and disfigurement benefits.

The first two are wage loss benefits that provide replacement income to workers temporarily or permanently unable to work because of a work-related injury (“total disability benefits”) or to dependents of workers who are killed on the job (“fatality benefits”). These benefits are tied to the wages the injured worker earned when he was hurt. States also impose maximums on the weekly wage loss benefits that are usually tied to average wages in the state for a given year.

“Specific indemnity” or “permanent partial disability benefits” compensate injured workers for permanent loss of, or loss of use of, parts of the body. Although permanent partial disability benefits are almost always tied to the injured worker's pre-injury wages, unlike wage loss benefits, payment of permanent partial benefits is not generally contingent on the worker's suffering actual income loss from the injury. Instead, the number of weeks of benefits to be paid for various permanent disabilities is set out in state statutory “schedules” and a worker with a permanent injury receives a share of the scheduled amount in proportion to the percentage rating of permanent disability in the corresponding part of his body (e.g. 50% of the back; 20% of the leg, etc.) Scarring and disfigurement benefits also belong in this category. Permanent partial disability benefits are frequently paid in a lump sum.

Most states, though not Connecticut, also allow workers' compensation commissioners to award benefits for injuries to parts of the body not listed in the schedules (“unscheduled injuries”). In Connecticut, all permanent partial disabilities are scheduled.

In addition to the information provided below, we also enclose a news article and press release describing recent workers' compensation reforms in New York, a press release on premium reductions in New Jersey, and an OLR report summarizing the workers' compensation premium reductions in Connecticut over the past three years (97-R-0550).

TOTAL DISABILITY BENEFITS

Connecticut's rate for total disability benefits is either comparable to or lower than that of all but one of the other states. New Jersey's benefit rate is the highest of the five at 70% of gross pay. New York's rate is second at 66 2/3% of gross pay. That rate yields a higher weekly benefit than the 75% of net pay rates used in Connecticut and Rhode Island. Massachusetts has the lowest total disability rate at 60% of gross pay.

Even though Rhode Island's benefit rate is the same as Connecticut's, it could produce a higher or lower benefit in some cases. Rhode Island excludes overtime from the wage base on which the benefit is figured, thus lowering benefits for workers who earned a lot of overtime pay. But it also adds $9 per week for each dependent child to the total disability benefit.

To illustrate the effects of these various rates and dependency allowances, consider a married worker with two children and a single worker, both earning $400 per week in gross pay. If he were totally disabled, the married worker would get a weekly workers' compensation benefit of $280 per week in New Jersey, $279 in Rhode Island, $266 in New York, $261 in Connecticut, and $240 in Massachusetts. The single worker would get the same benefit as the married worker in New York, New Jersey, and Massachusetts, but would get only $240 in Connecticut and Rhode Island.

Although Connecticut's benefit rate is one of the lowest, many Connecticut claimants still receive higher benefits because Connecticut has the highest maximum benefit rate of any of the surrounding states: $678 per week versus $631 in Massachusetts, $503 in Rhode Island, $496 in New Jersey, and $400 in New York.

Massachusetts and Rhode Island include automatic cost of living adjustments in their total disability benefits. Connecticut, New Jersey, and New York do not.

Table 1 summarizes total disability benefits in the five states.

Table 1: Total Disability Benefits

FATALITY BENEFITS

In general, fatality benefits are the same as total disability benefits in all five states. But Massachusetts' fatality benefit rate is 66 2/3% of gross pay instead of 60% while Rhode Island's dependency allowance increases to $20 per week per child from $9. These changes mean that Connecticut's fatality benefit rate is the lowest of the five states, although the maximum benefit rate in Connecticut is still the highest as already described.

Fatality benefits in the five states are shown in Table 2 below.

Table 2: Fatality Benefits

PERMANENT PARTIAL DISABILITY BENEFITS

Maximum awards for permanent partial disabilities in Connecticut are lower than those in New Jersey and Rhode Island, comparable to those in New York, and much higher than those in Massachusetts. Though all the other states have lower maximum weekly benefits than Connecticut, except for Massachusetts, they tend to award more weeks for the same injury.

Permanent partial disability rates and maximum awards for certain injuries are shown in Table 3 below.

Table 3: Benefits for Scheduled and Unscheduled Injuries

SCARRING AND DISFIGUREMENT BENEFITS

Four of the five states award extra benefits for certain permanent scars and disfigurement. Only New Jersey has no scarring benefit. In this category, Rhode Island has the most generous benefits. Connecticut's benefit is relatively high but the eligible scars are more narrowly defined than in any of the other states. Scarring benefits for the five states are shown in Table 4 below.

Table 4: Scarring and Disfigurement

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Attachments:

1. “Workers' Comp Reform Signed”- AP news article

2. “Governor Pataki Signs Historic Workers' Comp Reforms,” press release, September 10, 1996

3. News Release from New Jersey governor's office, October 25, 1996

4. OLR Report No. 97-R-0550