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WHAT IS WORKERS’ COMPENSATION?

Workers compensation is a state-mandated insurance program that provides benefits to employees who suffer job-related injuries and illnesses. Each state has its own laws and programs for workers compensation. 49 states require all businesses with employees to carry workers’ compensation (the exception is Texas).

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WHAT DOES WORKERS’ COMPENSATION COST?

The average cost of workers’ compensation insurance per 100$ in payroll on the United States ranges from .75 cents in Texas to 3.49$ in California.

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WHO PAYS WHEN YOU GET HURT AT WORK?

Medical care must be paid for by your employer if you get hurt on the job- whether or not you miss time from work. You may be eligible to receive benefits even if you are a temporary or part-time employee. You also may be covered by workers’ compensation as an employee even if you are called an “independent contractor”.

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WHAT ARE THE ELIGIBILITY REQUIREMENTS FOR WORKERS’ COMPENSATION BENEFITS?

1. You must be an employee
2. Your employer must carry workers compensation insurance
3. You must have a WORK-RELATED injury or illness
4. You must meet your state’s deadlines for reporting the injury and
filing a workers’ comp claim.

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HOW DOES THE WORKERS’ COMPENSATION CLAIMS PROCESS WORK?

If a worker is injured on the job, there is a limited amount of time to submit paperwork in order to receive workers’ compensation benefits. Both the worker and the employer must act promptly when an injury occurs. Otherwise, the claim could be denied.

When an injury occurs...
The employer must:

- Give the employee the appropriate paperwork and guidance.
- File the claim with the insurer.
- Comply with state law for reporting work injury/illness.

The employee must:

- Notify the employer of the injury (date, time, type of injury, and how
it occurred).
- File a formal workers’ compensation claim.

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WHAT IS COVERED?

- Wage replacement for time off work (usually has limits)
- Compensation for future income loss when applicable
- Payment or reimbursement of medical costs for the injury/illness
- Benefit payments to the family of the employee who was killed
during employment

WHAT IS NOT COVERED?

- Pain and suffering
- Punitive damages
- Other compensation for an employer’s negligent behavior

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PRO’S & CON’S OF WORKERS’ COMPENSATION

PRO’S:

- As an employer, it is beneficial because you do not run the risk of
being sued.
- You, as the employee, are getting paid for time you could have
been working if it wasn’t for the injury/illness, and are treated for
the injury/illness.

- It ends any financial uncertainty regarding how long your workers’
compensation payments will continue

- You can budget going forward based on the settlement amount,
rather than the stress of submitting medical bills to insurance every
few weeks and waiting for a check to arrive
- If you have a have a specific and pressing need for the money, a
lump sum may be beneficial to you.
- A settlement allows you to see any medical professional you want,
rather than bound to a doctor who is appointed by your employer.

CON’S:

- Once you receive a commutation of benefits, your workers’ comp
case closes forever.
- If your workplace injury results in a permanent disability, a lump
sum may not be beneficial to you.
- There is a state limit to the length of time you can receive
temporary benefits for an injury. These limitations are in the range
of 3 to 7 years. There is generally no limit on the length of a
permanent disability benefits, except some states terminate weekly
benefits when the employee reaches age 65.
- workers’ compensation does not pay full salary, usually 2/3 of your
regular salary.
- Workers’ compensation is public record and does show up on
background checks.
- In most cases workers’ compensation does not cover cases for
injuries sustained commuting to or from work.