Workers' Compensation - 6 Basic Facts for Employers
Fist, an overall look at worker's compensation, then some basic facts about how worker's compensation affects employers.
What is Worker's compensation?
Workers' compensation is insurance paid by companies to provide benefits to employees who become ill or injured on the job. Through this program, workers are provided with benefits and medical care, and employers have the assurance that they will not be sued by the employee (in most cases).
In each of the statements below, specifics differ from state to state. If you have questions about the worker's compensation laws in your state, contact your state's regulations on this list of state workers' compensation agencies.
Fact 1: Workers compensation is required for all employers.
That statement is essentially true, but the level and type of coverage is different for each state. States differ in:
- Who are covered employees
- Types of injuries covered and proof
- Excluded injuries
- Statutes of limitations (the length of time an employee has to file a claim)
- Employer defenses against claims, including self-inflicted injuries, willful misconduct, and injuries with drugs/alcohol.
Fact 2: Worker's compensation covers long-term illnesses and injuries as well as incidents.
Some workplace injuries can occur over time; repetitive stress injuries like carpal tunnel, for example. Illnesses caused by exposure to a workplace environment, like black lung, are also considered work-related and are covered by worker's compensation.
Fact 3: Workers compensation is paid by employers to a state fund.
As noted above, worker's compensation programs are administered on a state-by-state basis. The federal government administers separate worker's compensation programs for specific groups, including federal employees,longshore workers, and coal miners.
The cost of workers' compensation benefits is based on the gross payroll and the number and severity of illnesses and injuries that type of employer experiences. For example, a manufacturing company would have higher workers' compensation costs than a professional practice.
Fact 4: Employees may be able to sue an en employer for workplace injuries.
Although worker's compensation payments preclude employee lawsuits against employers, there are some circumstances in which an employee can still sue an employer for an on-the-job injury or illness for various reasons, including:
- If the injury was intentional on the part of the employer, or
- If the injury was outside the scope of the worker's job assignment.
Fact 5: Some workplace injuries are outside the scope of worker's compensation.
On the other hand, some workplace injuries are outside the scope of worker's compensation, and the injury or illness is not compensated by worker's compensation:
- If the injury was self-inflicted,
- If the injury happened during the commission of a crime,
- If the employee violated company policy, or
- If the employee was not on the job when the event happened.
Fact 6: Employees may not be discriminated against for filing a worker's compensation claim.
Under both federal and state laws, employers are prohibited from firing, retaliating against, or otherwise discriminating against employees who file worker's compensation claims.
For More Information:
You can find more information on federal worker's compensation programs on the website of the U.S. Department of Labor's Office of Workers' Compensation Programs.
Also Known As: Workers' Compensation, Worker's Comp, and workman's compensation (an outdated term, no longer used).