Supreme Court rules in workers’ compensation case, preserves cost savings for business

On Thursday, the Kentucky Supreme Court issued a ruling in a case that questioned the retroactivity of legislative changes made to Kentucky’s workers’ compensation law. The Court ruled the change to the law that terminates income replacement benefits when an employee reaches the age of 70, or four years after the injury or last exposure, should be applied retroactively from when the 2018 law took effect.

The legislature made significant changes to Kentucky’s workers’ compensation laws in 2018, and the changes have already led to a 10 percent reduction in workers’ compensation costs. Because of the significance of the legislation, the Chamber joined the Kentucky Coal Association, Kentucky League of Cities, Greater Louisville Inc., Commerce Lexington and the Northern Kentucky Chamber to submit an amicus brief in defense of the retroactivity of the law’s changes.

“Today’s ruling is an important win for the business community,” stated Chamber Sr. Vice President of Public Affairs Ashli Watts. “The legislation was carefully crafted to ensure the retroactivity of this key provision. Had the Court ruled differently, Kentucky businesses would have seen increased costs.”

Previously the Court had found the termination of the income replacement statute to be unconstitutional because it was based on social security eligibility. The Court had determined that since some workers don’t receive social security, the law treated different classes of workers differently. The legislature reacted to that ruling and other needs for reforms by passing the landmark legislation last year.

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