What Is A Loss Of Earning Capacity (LOEC) Claim?

A serious work injury can impact more than just your ability to do your previous job. Even after your condition has stabilized, permanent restrictions might stop you from returning to similar work, earning the same pay, or competing for jobs in the market. 

Wisconsin Worker’s Compensation law addresses this through a Loss of Earning Capacity (LOEC) claim. An LOEC claim looks at how a permanent work injury has reduced your ability to earn income, not just the medical percentage of disability given by a doctor. For injured workers in Milwaukee and across Wisconsin, this can be a key part of a Worker’s Compensation claim when an unscheduled injury leads to lasting work restrictions.

What Does Loss Of Earning Capacity Mean Under Wisconsin Law?

Loss of earning capacity measures how a work injury affects your ability to earn wages in the job market. Wisconsin law offers permanent disability benefits for the possible or actual loss of earning capacity when an employee does not fully recover from a work injury.

LOEC is most commonly associated with injuries that are considered “unscheduled” injuries under Wisconsin Worker’s Compensation law. These may include injuries involving the back, neck, torso, or other conditions that are not compensated according to the scheduled-loss provisions contained in Wis. Stat. § 102.52 through §102.56.

Wis. Stat. § 102.44(3) provides the framework for permanent partial disability involving injuries that are not covered by the scheduled injury statutes. The percentage of permanent disability may therefore reflect more than the medical impairment alone when an injured worker has experienced a genuine reduction in earning capacity.

How Is An LOEC Claim Different From A Medical Disability Rating?

A doctor’s permanent partial disability rating generally describes the physical or functional impairment caused by an injury. An LOEC evaluation asks a different question: How has that permanent impairment affected the worker’s ability to earn wages?

For example, two workers could receive similar medical restrictions following back injuries but experience very different vocational consequences. A worker whose entire career involved heavy construction may experience a substantial loss of earning capacity if permanent lifting restrictions eliminate most jobs for which the worker has training and experience. Another employee with similar restrictions may be able to return to a comparable-paying position that does not require heavy physical labor.

Wisconsin therefore considers vocational evidence in appropriate cases rather than treating medical impairment and earning capacity as identical.

What Factors Are Used To Determine Loss Of Earning Capacity?

Wis. Admin. Code § DWD 80.34 identifies the factors considered when determining loss of earning capacity. These include the injured worker’s age, education, training, prior work experience, previous earnings, current occupation and earnings, and prospects for suitable future employment. The analysis may also consider efforts to obtain suitable employment, willingness to participate in reasonable vocational rehabilitation, and other relevant evidence.

A vocational specialist may evaluate these factors and compare the employee’s earning ability before the injury with the employee’s earning ability after the permanent restrictions are imposed. The analysis is therefore individualized. An LOEC claim should reflect what the injury actually means for that particular worker’s employment prospects.

How Does The 15 Percent Wage-Loss Rule Affect An LOEC Claim?

Wis. Stat. § 102.44(6) contains an important limitation. When an injured employee returns to work for the same employer and the actual wage loss compared with the employee’s earnings at the time of injury is less than 15 percent, permanent disability generally is based on the physical limitations without regard to loss of earning capacity.

If the wage loss equals or exceeds 15 percent, however, loss of earning capacity may become relevant.

The statute also allows a permanent disability award to be reopened during the applicable statutory period when the employment relationship ends under qualifying circumstances or when a wage loss of at least 15 percent later develops. Wis. Stat. § 102.44(6)(b) specifically addresses situations in which the employer terminates the employment relationship, the employee leaves because physical or mental limitations prevent continued employment, or a qualifying wage loss occurs.

Wisconsin law calculates percentage wage loss using actual average wages over a period of at least 13 weeks. Periods in which temporary disability or unemployment benefits are being paid are generally excluded from that wage-loss determination. Wis. Stat. § 102.44(6)©-(f).

Why Vocational Evidence Can Matter In An LOEC Claim

Loss of earning capacity can become disputed because the insurance carrier may argue that an injured worker remains capable of earning close to the pre-injury wage despite permanent restrictions.

Vocational evidence can address the worker’s transferable skills, educational background, physical restrictions, available employment, likely wages, and realistic job opportunities. The goal is not simply to show that the worker earns less today. The evidence should establish how the permanent work injury has affected the worker’s earning potential in the competitive labor market.

Wisconsin also provides vocational rehabilitation opportunities for some employees whose work injuries prevent them from returning to their previous employment. Vocational rehabilitation may include services intended to help an injured employee obtain suitable work at wages comparable to pre-injury earnings.

Speak With Gillick, Wicht, Gillick & Graf About A Wisconsin Worker’s Comp Claim

A permanent work injury can change the type of work you are capable of performing and the wages you may realistically earn for years to come. An impairment rating from a doctor may not tell the full story when permanent restrictions prevent you from returning to your former occupation or substantially reduce your employment opportunities.

At Gillick, Wicht, Gillick & Graf, we represent injured workers in Milwaukee and throughout Wisconsin in Worker’s Compensation matters, including disputes involving permanent disability and loss of earning capacity. We can review your medical restrictions, employment history, post-injury wages, vocational evidence, and the circumstances surrounding any return-to-work offer to determine what benefits may be available under Wisconsin law.

If a work-related injury has reduced your ability to earn the income you earned before the accident, call our Milwaukee worker’s comp lawyers at Gillick, Wicht, Gillick & Graf at 414-257-2667 to receive a free consultation. Our law offices are located in Milwaukee, and we represent injured workers throughout all of Wisconsin.