By MATT CHANDLER
Buffalo Law Journal

A down economy can create additional woes for workers injured on the job.

How long will it take them to receive benefits from an injury claim? With a deep pool of job candidates ready to replace them, are injured workers at greater risk of losing their jobs if they report an on-the-job accident?

And with companies across the state laying off workers in droves, is there an uptick in fraudulent claims on the part of workers looking to avoid being laid off?

To get a flavor for what happens to the estimated 250,000 New York workers injured on the job each year, we spoke with attorneys who represent workers as well as profes-sionals who defend companies or investigate fraud.

Most agree that the system is far from perfect and that the waters are muddied for those trying to put food on the table following a work-related injury.

Peter Eisenhauer, an attorney with Lewis & Lewis PC, says reforms to the worker's com-pensation laws in 2007 left both claimants and attorneys searching for answers.

A key change was a new limit on partial-permanent-disability payouts. Before the revi-sions took effect, employees whose on-the-job injuries were deemed partial permanent disabilities were entitled to collect benefits indefinitely.

"The most you can get now, if your injury occurred March 14, 2007, is 525 weeks for a 95 percent permanent impairment, contingent on your loss of wage-earning capacity," Eisenhauer said. The trouble, he says, is that the guidelines used to define levels of dis-ability weren't updated at the same time.

"In light of the changes in the laws in 2007, I think a lot of people are going to find that they need attorneys when they maybe thought they didn't need an attorney before," he said. "Now with the cap, if you don't have guidelines set forth to say what constitutes a 95 percent permanent disability, how do you assess someone? Nobody knows."

Eisenhauer says in his firm's Buffalo office, he hasn't seen a jump in the number of cases filed compared to previous years, though his colleague Jack Stiefel, who works out of the Niagara Falls office, says claims at his office are up about 15 percent over last year, while he typically sees annual increases of 5 percent.

Fraudulent filings: Up or down?

Despite the jump in claims, Stiefel doesn't see employee fraud playing a role in the numbers.

"You know what it's like? Imagine you crash your father's car - that's what telling an employer you got hurt at work is like, because it is going to cost them money," Stiefel said. "In these non-union jobs, most of these employees have no security whatsoever, and they absolutely fear they are going to lose their jobs (for reporting a claim)."

Stiefel said while that is a major consideration for employees, some do conclude that fil-ing a claim is worthwhile. He explains: "They may also look at it like, ‘Hey, I've got to take care of me. If I can get myself healthy and back to where I need to be, I can al-ways find another job if the company lets me go.' "

What Stiefel and company are seeing locally doesn't necessarily match up to the state-wide picture, according to Steven Nachman, deputy superintendent for frauds and con-sumer services with the New York State Insurance Department.

"We're seeing a spike in fraud under the workers' comp system and an increase in cases in which recipients of workers' comp benefits, who may have been originally injured on a job, essentially secretly work a second job and don't tell the workers' comp board or their workers' comp insurer that they're employed elsewhere," he said. "It's very com-mon in that area, and no doubt there's some link between that and the deterioration of the economy."

Further changes on tap

The State of New York Workers' Compensation Board is developing additional changes to the rules that would in many cases eliminate hearings for injured workers, leaving claims to be decided based on paperwork alone.

Lawyer Susan Duffy, a partner in Hamberger & Weiss, believes the proposed program, called the Business Process Improvement Initiative, will lead to unfair outcomes on both sides, with claimants and defendants being unable to make their case before a workers' compensation law judge.

"In August, the board, on its own, without any real input from the parties, eliminated conciliation meetings (a form of mediation used to resolve disputed claims) altogether," said Duffy, who represents insurance carriers in defending against workers' comp claims. Building on that change, the board is now proposing what Duffy calls "a much bigger is-sue" with the BPII.

"The board is moving away from hearings in many situations with this plan," Duffy said. "I think what it will lead to is decisions being split down the middle. And for a side that feels they have a strong case, it won't offer them a chance to make that case and ques-tion witnesses."

Calls to the New York Workers' Compensation Board seeking comment on these changes were not returned.

Wait and see

For workers injured on the job, it can be a struggle - or at least a wait - to get the compensation they are entitled to. A national study conducted by the Workers Compen-sation Research Institute found that New York was among the slowest states in the na-tion to pay injured workers.

In 71 percent of New York cases reviewed in the study, claimants still had not received their first payment after three weeks, leaving many families living paycheck to paycheck struggling to pay the bills.

New York payouts were ranked among the lowest in the nation in terms of maximum benefits paid out - before the 2007 changes, the maximum weekly payout was $400, and now it's $500. At least some blame, says Stiefel, should fall on insurance carriers.

"The insurance companies have nothing to lose. It's not like other areas like no-fault auto policies, where if they lose they have to pay interest and attorney fees," he said. "The attitude is often, ‘I'll fight it (an employee claim), and if I lose I'll end up no worse than if I paid it.' "