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Worker’s Compensation

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One of the many significant changes made in the amended worker’s compensation law, which went into effect earlier this year, expands the occupational diseases covered by the system to include “mental impairment,” which is defined as a “post-traumatic stress disorder.” Employees with such afflictions may have claims in the alternative for coverage under employer-provided or self-furnished disability insurance policies, as well as worker’s compensation policies carried by their employers. However, the statutory definition of “mental impairment” is narrow. It requires documentation by a licensed physician, preferably a psychiatrist or psychologist; must fall within the standard Diagnostic Manual of Disorders, known as DSM; and may not result from “disciplinary” action at work, a job transfer, lay-off, demotion, promotion, transfer, retirement or other “similar action” taken in “good faith” by the employer.

The new measure should evoke more cooperation between lawyers representing employees or employers in workplace disputes and attorneys handling worker’s compensation matters. While the expanded coverage under the Worker’s Compensation Act may provide new opportunities for employee claimants who incur emotional distress due to workplace conditions, timing is important because if the claim arises after internal disciplinary action is taken, it may not be covered. Further, employees may confront another drawback: many personal injury claims or tort claims for work-related stress may be precluded by the exclusionary clause of the Worker’s Compensation Act, Minn. Stat. §176.011. Employers may resist having their claims treated under the statute for fear of driving up their insurance premiums.

All in all, attorneys for both employers and employees should be aware of these positive features and pitfalls in dealing with mental distress claims arising out of the workplace and coordinate their efforts with worker’s compensation counsel.

Originally published by Bench and Bar of Minnesota.