Every state has laws that require employers of a certain size to provide employees with workers’ compensation benefits. Governed by state law, workers’ compensation laws are in place in every state to protect employees against loss of income and for medical payments because of work-related injuries, accidents, illness, or disease. In the vast majority of states, workers’ compensation coverage is mandatory, but even if coverage is not mandatory for an employer, voluntarily participating in the state’s program is usually the wisest course of action to protect your workers and your business.
Some common elements of workers’ compensation include:
- Benefits are provided for accidental job-related injury. An employee is entitled to statutory benefits from you when the individual suffers a “personal injury by accident arising out of and in the course of employment.”
- Benefits include wage-loss, medical, and death benefits. Wage-loss benefits usually cover about one-half to two-thirds of the employee’s average weekly wage.
- Covered “employees” are defined by law. “Employees” generally does not include independent contractors.
- Fault is generally not an issue. Neither the employee’s own negligence in causing the accident nor your complete lack of fault are factors in deciding whether the worker gets benefits. In exchange for the assured benefits, employees give up their right to sue you for any injury covered by workers’ compensation laws. However, they still retain the right to sue negligent third parties, if said negligence helped cause the accident; any proceeds from the suit should be first applied to reimburse you for benefits paid to the employee.
State Workers’ Compensation Laws
In most states, all employers who have at least one employee are liable to provide workers’ compensation. While some states may exempt very small employers, they don’t all have the same definition of what constitutes a small employer. The most common exemption is for employers with fewer than three employees, but some provide the exemption to employers with fewer than four and others to employers with fewer than five. Of course, even if you’re exempt, you can generally choose to participate in the state program. Be aware that if you don’t participate in the workers’ compensation program in a state where participation is mandatory, you face fines, possible imprisonment, and denial of the right to conduct business in your state.
Actions to Take When Accidents Happen
There are two important actions that you must take as an employer when a job-related accident happens:
- You must file an accident report with the appropriate workers’ compensation agency in your state.
- You should, at least initially, treat every injury as legitimate, even if the circumstances surrounding the injury make you suspicious.
The requirements for filing an accident report differ in every state. Each state has its own laws that determine the time period within which reports must be filed. Your state agency will decide whether payments should be awarded to your employee. An appeal to a court of law is usually allowed only where the facts are in dispute. Payment of compensation benefits to your employee is usually made after a waiting period, most commonly three to seven days, and is retroactive.
Why is it so important to treat accidents as legitimate? Although workers’ compensation laws protect you from lawsuits for workplace injuries, they don’t completely insulate you from being sued. You could be sued by your employees, for example, for failing to provide them with the workers’ compensation benefits to which they are entitled. Treating every accident as legitimate will help reduce the chances of your being sued.
When is an Accident Work-Related?
Although the workers’ compensation agency or the insurance company is the one that will determine whether an injury is work-related, you should make your own investigation if the question is in doubt. Don’t forget that you may be better off if the accident is work-related because the workers’ compensation laws generally protect you from liability (while the insurance company that has coverage is better off if the injury is determined to be non work-related). The issue is not always clear.
How do you determine if injuries are work-related? It depends on the circumstances. The important point to remember is that if you believe an accident is work-related and that there is a chance that the agency or insurer will find that it is not work-related, you should gather any facts that you can that support your belief and be prepared to present your arguments to them.
We hope you found this introduction to workers’ compensation rights enlightening. Let us know in the comments below whether you would like us to explore further details regarding the topic.