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IowaWorkers Compensation

Iowa Workers Compensation – 2017 Law Changes

By May 5, 2017March 11th, 2019No Comments

Iowa House Bill 518, which was signed into law on March 30, 2017, makes several changes to the Iowa Workers’ Compensation Act (WCA). These changes are effective for work-related injuries that occur on or after July 1, 2017. This Employment Law Summary provides an overview of the changes.
The Iowa Division of Workers’ Compensation (DWC) monitors compliance with the WCA throughout the state.


Currently, an employee who sustains a work-related shoulder injury may receive permanent partial disability (PPD) benefits for up to 500 weeks as compensation for loss to the body as a whole caused by the injury. The actual number of weeks payable depends on several factors, including a physician’s impairment rating, the employee’s ability or inability to return to work, and the employee’s age, education and work experience.

Effective for injuries occurring on or after July 1, 2017, shoulder injuries will no longer be considered a loss to the body as a whole. Instead they will be included in the WCA’s PPD schedule. This schedule lists various body parts and functions and assigns a value, expressed as a number of weeks, to each of them. The number of weeks represents the maximum time period for which an employee may receive PPD benefits if he or she has a complete loss of the specified body part or function. If an employee’s loss is not complete, he or she is entitled to a portion of the assigned value. That portion is determined using the physician’s impairment rating alone.

Because shoulder injuries will be included in this list effective July 1, 2017, factors such as the employee’s ability or inability to work will no longer be considered in determining the PPD rating for a shoulder injury. In other words, an employee’s PPD rating from a physician will be the sole factor in determining how many weeks of PPD benefits the employee may receive for a shoulder injury.

The law change also significantly reduces the maximum number of weeks for which an employee may receive PPD benefits for a shoulder injury. While the current maximum is 500 weeks, the maximum PPD benefit period for a shoulder injury will be 400 weeks as of July 1, 2017.

Under another change, however, employees who cannot return to gainful employment because of a shoulder injury will be eligible to participate in a program designed to help them return to the workforce—the New Career Vocational Training and Education Program. Under this program, employees with a permanently disabling shoulder injury can attend a community college to receive new training. The plan requires employers to pay up to $15,000 for each eligible employee’s tuition, fees and supplies.


For injuries to body parts or functions that are not listed in the WCA’s PPD schedule, PPD ratings are based in part on whether the employee has lost the ability to earn the same or higher wages than he or she earned at the time of the injury. This type of loss, which takes into account the employee’s age, education and work experience, is referred to as “industrial disability” or “loss of earning capacity.”

Effective July 1, 2017, the WCA specifies that an employee’s loss of earning capacity PPD rating must also take into account “the number of years in the future it was reasonably anticipated that the employee would work at the time of the injury.”

The change also specifies that an employee is not eligible for loss of earning capacity benefits if he or she returns to his or her pre-injury job or is offered other work at or above his or her pre-injury wage rate. Instead, an employee in this situation will be entitled to PPD benefits based solely on the physician’s impairment rating. However, an employee who returns to work but is later terminated may petition the DWC for a PPD rating based on loss of earning capacity.


House Bill 518 makes several small changes and clarifications to the WCA’s provisions regarding permanent total disability (PTD) benefits. In general, PTD benefits are payable if an employee’s work-related injury leaves him or her completely unable to return to any type of gainful employment on a permanent basis.

Effective July 1, 2017, the WCA clarifies that:
• Any PPD benefits must terminate when any PTD benefits begin;
• An employee who is receiving PTD benefits may not simultaneously receive PPD benefits;
• PTD benefits are payable until an employee is no longer permanently and totally disabled;
• An employee may not receive PTD benefits for any week in which he or she receives gross earnings from any employer or payment for services from any source in an amount that is equal to or greater than 50 percent of the statewide average weekly wage; and
• An employee is not entitled to PTD benefits while receiving unemployment compensation.


Under the WCA, an employee may be disqualified from receiving workers’ compensation benefits if his or her own alcohol or illicit drug intoxication was a substantial factor in causing his or her injuries.

Under a new provision that becomes effective July 1, 2017, an employee will be presumed to have been intoxicated at the time of his or her injury, and the intoxication will be presumed to have been a substantial factor in causing the injury, if the employee tests positive for the presence of alcohol or drugs at the time of or immediately following an injury. For this purpose, a drug includes any narcotic, depressant, stimulant, hallucinogenic or hypnotic substance that was either not prescribed by an authorized medical practitioner or not used in accordance with the prescribed use of the drug.

Once an employer establishes these presumptions, the employee will have the opportunity to overcome them by proving that he or she was not intoxicated at the time of the injury or that intoxication was not a substantial factor in causing the injury.


An employer can avoid or reduce its liability for temporary disability or healing period benefits by offering suitable work to employees who are temporarily disabled due to work injuries. If an injured employee refuses his or her employer’s offer of suitable work, he or she forfeits the right to receive any temporary disability or healing period benefits during the period of refusal.

Currently, the WCA does not indicate exactly how a suitable offer must be made in order for this provision to apply. However, effective July 1, 2017, the law specifies that employers must make offers of suitable work in writing.

A written offer of suitable work must include details of any lodging, meals and transportation associated with the work offered. It must also communicate to the employee that:
• If he or she refuses the offer of temporary work, he or she must make the refusal in writing and provide the reason for the refusal in writing as well; and
• Unless the work refused is not suitable, he or she will not receive any temporary partial, temporary total or healing period benefits during the period of the refusal.

In addition, the DWC will presume that an offer of work is geographically suitable even when the employee’s duties involve travel away from the employer’s principal place of business or established place of operation for more than 50 percent of the time if the employee has previously worked at the principal place of business or established place of operation.


To be eligible to receive benefits under the WCA, an employee must:
• Provide his or her employer with notice of any work-related injury within 90 days after the date of the occurrence of the injury; and
• File an application with the DWC within two years after the date of the occurrence of the injury (or within three years after the employer last paid weekly workers’ compensation benefits for the injury).

Currently, the WCA does not define “the date of the occurrence of the injury.” However, effective July 1, 2017, the law specifies that this phrase means “the date that the employee knew or should have known that the injury was work-related.”


Other changes to the WCA that will become effective July 1, 2017, include the following:
• Future benefits may be commuted to a present worth lump-sum payment only if all parties provide written consent (currently, the WCA does not require the parties’ written consent for commutations);
• If an employee’s injury occurs outside of Iowa, the employee will be entitled to WCA benefits if the employer has a place of business in the state and the employee regularly works at or from that place of business (currently, an employee with an out-of-state injury must be domiciled in Iowa to receive WCA benefits); and
• An attorney will only be able to recover fees based on the benefits that the attorney demonstrates would not have been paid to the employee but for the efforts of the attorney (currently, the WCA does not specify how legal fees may be determined).


For more information on particular areas of the WCA, please contact Conservation United or visit the DWC website.