What is Workers’ Compensation?
Workers’ compensation developed with the rapid industrialization that occurred in the early twentieth century in the United States. The growth of industrial jobs was accompanied by an increase in workplace injuries, particularly in factories, with heavy machinery and other high-risk environments.
Without worker’s compensation, a worker injured or disabled while performing his or her job would have to resort to litigation to pay for medical expenses and recover lost future earnings. This often ended up with the case being dismissed, disenfranchising thousands of workers. Workers
compensation provides a guaranteed level of compensation to those workers if injury occurred in the line of duty.
What are the benefits of workers’ compensation?
Since workers’ compensation is a mutually agreed-upon guarantee, the transactional costs that accompany the process of litigation, investigation and legal maneuvering would be avoided. This agreement is based on an idea called “compensation bargain” or “exclusive remedy”: workers are guaranteed to receive a set level of benefits in exchange for giving up the right to take the employers to court. In exchange, employers are mandated a floor amount of compensation even if a worker is found negligible or liable.
In the United States, most of the workers’ compensation programs are run by the state, although there are over a thousand commercial insurers operating. There is wide variation of benefit schemes, and coverage of illnesses and injuries. Workers compensation insurance is required by state law in most areas.
Benefits under workers compensation programs include medical expenses, a set percentage of lost earnings, as well as lost future earnings. It may even include clauses for training in skills that would make the injured worker employable in the future. In cases where the worker dies, the family receives compensation for medical expenses and cash benefits for lost days of work. Monetary compensation is often less than the previous rate of earnings.
How do you file a workers compensation claim?
Majority of employers will be required to provide some form of workers compensation. Some states provide exemptions for smaller companies and industries, as well as for domestic workers and independent contractors.
Coverage will depend on the program provided by the employer. They can range from injuries that were sustained at work, or conditions following long-term exposure to unsafe conditions. Injuries like loss of life and limb in a factory accident, to respiratory failure from asbestos exposure, or malignancies from radiation exposure are covered if these can be directly attributable to the employment. Injuries that are sustained after work hours, e.g., during the work commute, are not covered, while transportation-related injuries are.
It is best to seek legal counsel when filing a claim for workers compensation, particularly in cases that may be rejected by the employer. It is required by law to have a procedure for claiming workers compensation. An employee claim form will have to be processed. If this is rejected, litigation may be pursued if the claim is assessed to be actionable.
In certain cases, the employer will offer to settle to avoid the expense and inconvenience of a trial. There will be advantages and disadvantages to accepting or rejecting a settlement offer. These must be discussed before any commitments are made.
In most cases, an independent medical exam may be required. This will ensure an objective and impartial assessment of the worker’s claim. The assigned physician conducts a complete physical examination, which will serve as the basis for assessing the level of compensation. Appeals can be made to the state workers compensation board if the level of compensation received is not commensurate to the injury.
What are the different compensation packages?
There are cases when a worker returns to work without full recovery, leading to a reduction in tasks and the corresponding salary. This is compensated by temporary partial disability benefits until such time that the worker is assessed to have recovered from the injury. Workers who suffer permanent impairments that do not completely preclude future employment receive permanent partial disability benefits. Those who suffer permanent disability will receive permanent total disability benefits. This will often entail a more generous package of benefits, as well as support for lost future earnings.