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High Court Upholds Flawed Workers’ Compensation Presumption

This summer, the Minnesota Supreme Court reversed a Court of Appeals decision to deny Ford Motor Company the right to discontinue workers' compensation benefits to George E. Frandsen once he turned 67 last year.

Frandsen filed suit against Ford Motor Company for discontinuing his permanent total disability payments due to his age. Frandsen was disabled in a workplace accident at a Ford plant in 2004. At the time, his injuries were determined to be permanently and totally disabling. Six years later, Ford Motor Company sent him a letter notifying him that his workers' compensation benefits would stop after his 67th birthday in February 2010.

In Minnesota, workers' compensation law does not specify at what age, if any, permanent total disability benefits stop. Instead, there is a concept called "retirement presumption," which means that insurance companies can presume that a worker is retired at age 67 and send notice to injured workers that their Minnesota work injury benefits will be discontinued. If an injured worker receives such a letter, he or she does have the right to a hearing on the proposed end to workers' compensation benefits, but such claims can take more than a year to be resolved.

What Frandsen attempted to show was that Ford waived its right to stop benefits, since in the original agreement it did not explicitly state that benefits would cease when Frandsen reached retirement age. The Court of Appeals found that Ford did waive its rights to deny payments, but the Supreme Court reversed this decision, saying that Frandsen did not adequately prove that Ford intended to waive its right to stop benefits by not providing an end date in the original agreement.

Need for Reform

The Frandsen case highlights the ambiguities in the current law and clearly shows that reform is necessary. Permanent total disability benefits are awarded to those individuals who have suffered a workplace injury so severe that they are permanently and totally disabled and will never be able to work again. These injuries, which affect the course of a victim's everyday life, do not disappear once an individual reaches age 67. Indeed, in this tough economy, many Americans are unable to stop working once they reach 67.

Workers' compensation provides essential income to permanently disabled people and helps keep these people in their homes, fed and healthy. Such crucial benefits should not be allowed to stop once someone reaches an arbitrary age.