What is Workers Compensation
Workers’ Compensation (WC) is a form of insurance for an employee’s wages. WC provides a wage replacement and medical benefits to someone injured in the course of their job.
In the United States, most employees injured on the job are eligible to receive medical care due to workplace injury. In some cases, injured workers can also receive payment to compensate for a resulting disability as well.
Injuries that occur to or from work generally do not qualify for workers’ compensation benefits. There are some exceptions to this, however. Including if your responsibilities require you to be in multiple locations or stay after hours.
Workers compensation insurance policies are available to companies through commercial insurance brokers. Employers deemed to be an excessive risk to insurers, can usually obtain coverage through assigned-risk programs. Many states in the United States have public uninsured employer funds to pay benefits for workers at companies who illegally fail to purchase workers compensation insurance.
Different jurisdictions have different plans and stipulations, but often there are provisions for the following:
- Weekly payments in place of wages, a form a disability insurance
- Compensation for economic losses, both past, and future
- Reimbursement for medical expenses, a sort of health insurance
- Benefits for the dependents a worker killed during employment
A workers compensation system usually does not have the following:
- General damage for pain and suffering
- Punitive damages for employer negligence
Accepting a worker compensation insurance payout is often in exchange for giving up the employee’s right to sue their employer for negligence. This trade-off between assured, but limited coverage and losing access to recourse is known as “the compensation bargain.” For companies, the compensation bargain helps them from becoming insolvent as a result of high levels of damages.
Each state varies in how the worker’s compensation laws are structured, the amount of benefits that workers can receive, and the duration of benefits. These can be determined by various governing boards, or “quasi-judicial agencies.” Many being designated as “workers’ compensation commissions” that manage the division of worker compensation.
In every state except for Mississippi and Georgia, it is illegal for employers to refuse to hire an individual or terminate an employee for having reported a workplace injury or filing a workers’ compensation claims. Unfortunately, it is often not very easy to prove discrimination based on employee claim history. To reduce this type of discrimination, some states have created “subsequent injury trust funds” which can reimburse insurers for benefits paid to workers suffering a recurrence of a compensable injury.
A claim can be denied on the following grounds:
- The employer or employee does not follow the proper reporting procedures
- The insurance carrier does not believe the claim
If a claim has been denied, the injured employee is able to appeal the claim. In most states, this is handled by administrative law judges, who will determine the facts of the case.
According to a 2018 study, as much as 70% of denied claims are ultimately paid. While some employers and insurance companies will vigorously contest employee claims, injured workers may be able to get help from their state’s agencies or by retaining a lawyer who specializes in workers’ compensation.
Laws in many states will limit a claimant’s legal expenses to a certain fraction of the award. This includes contingency fees” and are payable only if the recovery is successful. This number typically varies between 11% and 40%, depending on the state.
Filing a Workers Compensation Claim
Filing a WC claim varies depending on the state you live in and the type of work you do. It may also involve the insurance company of your employer. Filing a claim will involve scheduling an appointment to evaluate your medical condition as well as providing medical records, including your medical history. Details about the injury such as location, time of injury, safety precautions, and understanding of risk will need to be provided in your WC claim.