(This story has been updated from an earlier version to include information on S.B. 755, which amended the original law.)

A new state law in New York allowing workers to file claims for workers compensation for specific types of mental injuries related to “extraordinary work-related stress” could create a surge in claim filings and litigation, legal and insurance experts say.

S.B. 6635 and the accompanying A. 5745 were signed into law in December after New York lawmakers spent seven years attempting to clear the way for mental stress injuries in workers comp. The bills, which each had more than a dozen co-sponsors, faced significant opposition, as nearly a third of lawmakers voted against the measures.

The issue became more complex in February when Gov. Kathy Hochul signed into law S.B. 755, which removed language that made mental injuries from stress compensable for all “workers” to just for first responders in covering a “work-related emergency.” Those changes go into effect in June, according to a spokeswoman in the governor’s office.

S.B. 755 also added an amendment to existing comp law that some say created an avenue for workers to file mental injury claims.

“The new law is concerning in that it eliminates the current requirement that a workers compensation claimant prove that the workplace stress the claimant experienced was greater than that which usually occurs in a normal work environment in order to receive workers compensation benefits for workplace stress claims,” said Steven Bennett, vice president of workers compensation programs and counsel for the Washington-based American Property Casualty Insurance Association.

Eliminating the requirement that the stress be greater than what usually occurs in a normal work environment contradicts long-established court and workers compensation precedent, he said. “APCIA is concerned that this change will flood the New York workers compensation system with dubious mental stress claims and could significantly increase costs for New York employers,” he said.

Several legal experts say they are waiting on the state Workers’ Compensation Board to weigh in on the changes.

The governor’s spokeswoman said that “the new law (signed in February) extends the mental stress provisions to all workers” but did not explain why S.B. 755 crossed out language pertaining to all “workers.” First responders are already able to file mental injury claims under New York’s presumption, enacted in 2017.

Courts have sought to define work-related stress for years. Recent cases have highlighted the complexity of the issue (see related story below).

The new law marks “a major change for New York,” said Sarah Thomas, managing partner of New York-based insurance defense law firm Jones Jones LLC. “The industry is going to see an increase of mental health claims coming in.”

Ms. Thomas said she is waiting on clarification from the board and that the changes will still create legal wrangling.

The issue of mental injuries has “been litigated quite a bit” before the New York State Workers’ Compensation Board and the Appellate Division, she said.

The law contains “lazy statutory language,” which almost ensures litigation will follow, said Todd Jones, Garden City, New York-based partner at Goldberg Segalla LLP, another comp defense firm.

“Businesses are going to subsidize the first few years of this law,” he said.

Most cases will not be simple and employees will have to prove “a causal relationship between the workplace, or particular work activity, and the mental injury that’s claimed,” said Mark Goldstein, New York-based partner in the Labor & Employment Group at defense firm Reed Smith LLP.

“Obviously, that needs to be worked through the administrative process and possibly the courts,” he said.

Some experts see mental injury claims going through the workers compensation system rather than civil courts as a positive.

“We see that there may be additional workers comp claims for emotional distress, (yet) with regard to employment litigation there’s a potential defense — workers comp exclusivity may apply either as a complete bar or a set-off,” said Lisa Griffith, a shareholder in the Melville, New York office of Littler Mendelson P.C.

Mr. Goldstein pointed to the possibility of a double remedy; in cases of discrimination that led to extraordinary stress, a worker could seek both workers comp and civil remedies.

“The workers comp process would not be the exclusive forum in which their case could be heard. They could still bring a subsequent discrimination claim in court,” he said. “That said, the employee who brings that claim may have to offset any claim damages or settlement by the amount of their workers comp payout.”

Accepting a mental stress claim, in some cases, may help an employer, but much will depend on the facts, Mr. Goldstein said.

“I don’t think there’s a benefit to digging your heels in the ground if there’s no point doing that,” he said.

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Appeals Courts find employees’ mental trauma claims not compensable

An appeals court on Jan. 16 dismissed a post-traumatic stress disorder claim filed by a bus driver after a man attacked the bus she was driving, finding that the event was not outside the norm of issues faced by bus drivers in New York City.

A transit bus operator for 21 years with the Manhattan & Bronx Surface Transit Authority, the woman filed a claim for workers compensation benefits, contending she suffered from PTSD following the incident “wherein an unidentified man — unsuccessful in his attempt to board the bus she was driving while it was stopped at a red light — climbed onto the front bumper, pounded on the windshield and damaged a wiper blade and side mirror on the bus,” according to CV-23-0854, filed in the State of New York Supreme Court, Appellate Division 3rd Judicial Department. The claim was denied.

Following an independent medical examination and a deposition of the woman’s physician, a workers compensation law judge found that the claimant, who returned to work approximately three months after the incident, sustained a “work-related” mental injury.

The Workers’ Compensation Board reversed on appeal, finding the driver “failed to establish that the stress she experienced as a result of this incident was greater than that experienced by similarly situated bus operators.”

In affirming the board’s decision, the appellate court said that “it is expected that bus operators could be exposed to unruly individuals and property damage to the vehicle.”

Similarly, another New York appeals court on Oct. 10 disallowed a field repair technician’s 2018 workers comp claim for mental stress that she claimed exacerbated a preexisting psychological condition.

In CV-23-1581, filed in the Appellate Division of the Supreme Court of the State of New York, the technician alleged that “she was overworked and exposed to constant intimidation and harassment, with people yelling at her on a daily basis when she arrived for work in the morning, to the point where she feared for her safety.”

A workers compensation law judge concluded that the claimant “failed to establish that her alleged injuries were caused by a workplace accident,” according to court records.

The appeals court wrote that “although the medical evidence indicated, based upon claimant’s self-reporting, that work-related stress exacerbated her posttraumatic stress disorder … the Board’s factual determination that claimant had not experienced stress greater than that which other similarly situated workers experienced in the normal work environment is supported by substantial evidence.”