Industrial Disability in Iowa Workers’ Compensation: Key Factors and Recent Cases

In cases involving unscheduled injuries, industrial disability is frequently a cause of controversy. For defendant-employers, it’s a source of increased exposure; for claimants, it represents an opportunity for a greater reward. Above all, it must be handled carefully by both parties, as it has the potential to seriously alter the outcome of a case.

Industrial disability is meant to compensate injured workers for reductions to their overall earning capacity. Workers become eligible for industrial disability awards when they have been terminated by their employers after sustaining a workplace injury. When conducting an industrial disability analysis, the Agency considers the following factors, which are all considered relevant for purposes of determining “the employee’s prospects for relocation in the job market” [1]:

• Age: Older claimants typically receive a higher industrial disability award than younger claimants.

• Education: Claimants with less education, and a reduced ability to transition into skilled labor, tend to receive higher awards than highly-educated claimants.

• Work History: Claimants with a limited work history tend to receive higher rewards than claimants who can return to a previous line of work.

• Functional Disability: Given that a claimant’s functional disability rating typically serves as the floor for industrial disability awards, claimants with high ratings usually receive higher awards than claimants with low ratings.

• Post-Injury Earnings: A claimant who has returned to work at a wage that is lower than what she previously earned will receive a higher industrial disability award than a claimant who is earning the same amount.

• Motivation to Work: A claimant who seems motivated to return to work is likely to receive a greater industrial disability award than a claimant who seems unmotivated.

Four recent cases serve as useful examples of how the Agency weighs these various factors in practice:

• Renaud v. Warren County (60%): In Renaud v. Warren County, a 53-year-old claimant was awarded 60%. She was a 53-year-old high school graduate with an AA in law enforcement and experience working as a certified EMT, a personal trainer, and a massage therapist. Despite these qualifications, however, she was under work restrictions that reported her from lifting more than 25 pounds and was making $10.46 less per hour than she was before the accident. As a result, she was awarded 60% ID.

• Hermanstorfer v. Lennox Industries (40%): In Hermanstorfer v. Lennox Industries, a 61-year-old claimant was awarded 40% ID. She was a high-school graduate who, at the time of hearing, had spent 28 years working for the defendant-employer. In his appeal decision, Commissioner Cortese noted that claimant made less money than she did before her injury, and that her restrictions prevented her from returning to previous positions at Hy-Vee and Fisher Controls. Hermanstorfer, File No. 19002216.01 (Arb. 11/13/2025) at 6.

• Wagner v. Intren (75%): In Wagner v. Intren, a 49-year-old claimant was awarded with 75% ID. In the decision, Deputy Humphrey noted that while claimant “has a high school education and training as a welder. . . his grades and ADD make him a poor candidate for re-education or re-training,” Wagner, File No. 22002178.01 (Arb. 4/30/2025) at 30. The deputy additionally noted that the claimant was unable to become re-certified in his high-paying welding specialty, “which has reduced his earnings by about 52 percent.” Id. As a result, the claimant was awarded 75% ID. While the defendant-employer had previously accommodated the claimant’s work restrictions, this fact ultimately didn’t serve to reduce the ID award. Given the fact that the claimant could not become recertified in the high-paying work he had previously performed, Deputy Humphrey doubted that Intren could “have accommodated him at his pre-injury earnings level.” Id.

• Houdek v. Kelly Building Systems (70%): In Commissioner Cortese’s appellate decision in Houdek v. Kelly Building Systems, he found that the award of 50% industrial disability originally awarded to the claimant—a 62-year-old high school graduate who had worked for the defendant-employer from 1992 until the 2010s—was too low. In his decision, Commissioner Cortese specifically noted that “[i]t is highly unlikely claimant can return to [a position as a working manager performing physical carpentry tasks].” Houdek, File No. 5060845.01 (Arb. 3/5/2025) at 5. As a result, Commissioner Cortese concluded, “claimant’s future earning capacity is more severely impacted than estimated by the deputy commissioner” and awarded the claimant with 70% industrial disability. It should be noted that, although the claimant was able to retrain for a new career and start a home inspection business, this did not render him ineligible for a high ID award. As Commissioner Cortese himself noted, the fact of the matter remained that he had limitations and was unable to return to his previous line of work.

  [1] Klein v. Furnas Elec. Co., 384 N.W.2d 370, 374 (Iowa 1986)