TN 64 (06-23)

DI 52120.020 Arizona Workers’ Compensation (WC)

A. Types of WC payments

1. Temporary Total (TT)

Paid biweekly. Begins on the eighth day of disability. If the disability extends beyond 14 days, TT is paid retroactively from the day after the date of injury of date medical treatment is first sought.

2. Temporary Partial (TP)

Paid every 30 days.

3. Permanent Total (PT)

Maximum period is lifetime or duration of the disability.

4. Permanent Partial (PP)

Maximum period is duration of the disability.

There are two kinds of permanent impairments, scheduled and unscheduled. Both types are paid on a monthly basis.

  1. a. 

    Scheduled – a disabling injury, usually of the extremities (arm, leg, etc), or a specific body part (loss of permanent teeth), for which permanent compensation benefits are set by Arizona Workers’ Compensation Law for a specific length of time, regardless of loss earning capacity.

  2. b. 

    Unscheduled – if the injury is not recognized by Arizona law as scheduled, the benefits are based on the loss of earning capacity, which may continue for the lifetime of the disabled worker.

    These awards take approximately 90 days from the issuance of the notices by the insurance carrier.

    The insurance carrier will review this type of award on a yearly basis, sending the disabled worker an Annual Report of Income. Both the disabled worker and insurance carrier have the right to file a Petition for Rearrangement. This petition requests the Industrial Commission of Arizona (ICA) to review the previous award and determine whether the monthly benefits should remain the same, increase, decrease or cease.

B. Cost-of-living adjustments (COLAs)

Arizona does not provide for cost of living increases for any type of WC payment.

C. Attorney fees

1. Fees set by Industrial Commission of Arizona (ICA)

ICA has no statutory authority to grant attorney’s fees and costs unilaterally. However, the statutes do allow ICA to fix a reasonable contingent fee when the disabled worker and the attorney are unable to agree and either party files an application requesting ICA to set the fee. In this situation, ICA provides for deduction of the fee from the award and payment of the fee directly to the attorney. The fee in this situation cannot exceed 25 percent or continue for more than 10 years from the date of the award (5 years for unscheduled PP awards).

2. Fees not set by ICA

The State Compensation Fund (SCF) will often issue all WC payments directly to the attorney. Except as noted in DI 52120.020C.1. above, the state does not set or control attorney fees for WC cases; fees are a matter between the client and attorney.

  • The attorney typically takes a percentage (maximum amount of 25 percent) of the WC check and then issues a check for the difference to the NH. The deductions by the attorney are excludable expenses for offset. For more information, see DI 52150.050 - Excludable Expenses.

  • Contact the attorney directly to verify any legal expenses if the fees are not set by ICA and it appears that the SCF may have issued the WC payment.

D. Retirement insurance benefit (RIB) considerations

Arizona does not offset WC for SSA retirement benefits.

E. Lump sum commutations and settlements

  1. 1. 

    The Industrial Commission of Arizona (ICA) may allow commutation of a PP scheduled award to a lump sum not to exceed $25,000.00. ICA may also allow commutation of a PP unscheduled or PT award not to exceed $150,000.00 beginning 06/30/2007 (earlier requests were subject to lesser amounts). For more information, see DI 52150.065B - LS Awards Involving a Commuted Value of Future Periodic Payments.

  2. 2. 

    Lump sum settlements are final and binding. Provisions for reopening are based on a change of physical condition. There is no basis for reopening to secure a more advantageous proration computation. Any such modification would not be binding on the Social Security Administration. For more information, see DI 52150.065E - Subsequent Addenda to LS Settlements.

F. References

  • Industrial Commission of Arizona (governing agency):

  • Arizona Workers’ Compensation Law, Title 23, Chapter 6, Article 8 – Amount of Compensation :


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0452120020
DI 52120.020 - Arizona Workers’ Compensation (WC) - 06/30/2023
Batch run: 06/30/2023
Rev:06/30/2023