APPLES TO APPLES: The Commissioner Provides Guidance Regarding Iowa’s Apportionment Statute

April 5, 2023

By: Shelley Goodell, Stephanie L. Marett, Coreen K. Sweeney, Stephanie Techau

In a recent Appeal Decision, the Commissioner settled some confusion and discord within the Iowa Division of Workers' Compensation regarding the amended successive disabilities (apportionment) statute. 


Iowa Code §85.34(7) provides:


An employer is liable for compensating only that portion of an employee’s disability that arises out of and in the course of the employee’s employment with the employer and that relates to the injury that serves as the basis for the employee’s claim . . . . An employer is not liable for compensating an employee’s preexisting disability that arose out of and in the course of employment from a prior injury with the employer, to the extent that the employee’s preexisting disability has already been compensated . . . . An employer is not liable for compensating an employee’s preexisting disability that arose out of and in the course of employment with a different employer or from causes unrelated to employment. 


Thus, if a worker has previously been compensated for a disability, the statute allows for a credit to be taken for the compensation previously paid against the new compensation owed.  The question, however, was how to apply this credit where the past and current injuries were different and/or were compensated differently (i.e., functional vs. industrial).  Some prior agency decisions held the newer statute did not provide a mechanism for apportionment between such different losses, as this was like comparing apples to oranges. 


In the complicated case of Brunk v. Glenwood Resource Center & State of Iowa, File No. 19003535.02 (App. Dec’n February 27, 2023) (no Petition for Judicial Review pending), the worker had received industrial disability compensation for a pre-2017 unscheduled shoulder injury through an Agreement for Settlement.  He later sustained a body as a whole back injury, but was limited to his functional rating because he had returned to work for greater wages.  The employer asserted it was entitled to a credit for the compensation paid for the prior shoulder injury.  In allowing the credit, the Commissioner stated:


In light of the plain text of the statute viewed in the light of the intent to avoid double recoveries, I find defendants are entitled to a credit for the prior 2013 industrial loss for the unscheduled loss to claimant’s shoulder with respect to the 2019 unscheduled functional loss to his back.  Because claimant’s 2019 injury resulted in an eight percent functional loss entitling claimant to 40 weeks of [PPD] benefits which does not exceed the prior 22.5 industrial loss entitling claimant to 112.5 weeks of [PPD] benefits, claimant is not entitled to any additional [PPD] benefits in this case.


Although there will likely be other scenarios not addressed by this decision, it resolves some confusion and underscores the importance of properly documenting employee disabilities and compensation paid, to ensure a credit can be applied later if a subsequent injury occurs. 


Please contact the Nyemaster Workers’ Compensation team with questions.