Workers' Compensation

Workers' Compensation Benefits

Generally speaking, most U.S. employees who receive injuries or become ill in the course of employment are eligible for state-mandated workers' compensation benefits. Workers' compensation benefits for eligible employees vary by state, but generally include the following basics.

• Payment of related medical expenses
• Job retraining if needed (e.g., vocational rehabilitation)
• Income tax-free, partial wage replacement if unable to work due to disability

Surviving dependants of eligible employees who died in the course of employment are also generally eligible for state-mandated workers' compensation benefits, typically including burial allowances.

For workers' compensation benefits, disabilities are typically classified as temporary or permanent and partial or total.

For example, permanent total disability (PTD) typically means that a worker has a permanent disability that will keep him or her from working forever; permanent partial disability (PPD) typically means that a worker can work in some capacity despite his or her permanent disability, once released to go back to work by a doctor.

Most workers' compensation insurance plans pay disabled workers at a rate of only two-thirds of gross weekly wages. (In a few states, the plans also pay dependent allowances.) But, without the burden of income tax deductions, workers' compensation might amount to about the same net wages employees earn after paying income taxes when working.

However, many states cap the maximum amount employees may receive in weekly workers' compensation and for how many weeks.

For example, at this writing, eligible Missourians who can't work at all for awhile because of temporary total disability (TTD), receive two-thirds of their gross wages up to a weekly maximum of $675.90. Eligible Californians on TTD receive the same up to weekly maximum of $840. But, Missourians may collect TTD workers' compensation for up to 400 weeks, while Californians may collect for up to only 104 weeks (for most injuries).

If you receive an offer of a lump-sum workers' compensation settlement, before accepting it's a good idea to consult your doctor, to insure that you won't be requiring further medical treatment. (Two or three doctors' opinions might be a better idea.) If you will or even only might need further treatment down the road, think twice about settling. Once you've settled, it's highly likely that the initial amount is all you'll receive, even if your condition continues, worsens or leads to other medical conditions.

Because it's an insurance adjuster's job to negotiate the least amount possible, it might also be a good idea to hire an attorney who is skilled at negotiating workers' compensation settlements. In fact, simply having the power of attorney representation might encourage an adjuster to offer you more than otherwise.

Examples of employees who are exempt from (not eligible for) state workers' compensation insurance benefits are listed below.

• Federal, and longshore and harbor employees. However, such employees are covered by Federal workers' compensation programs. (More information is on the next page.)
• Certain agricultural and domestic employees are exempt from workers' compensation benefits in some states, or receive only limited coverage or have different eligibility requirements than other types of employees.
• A few states exempt employees who work for organizations that employ fewer than a specified, minimum number of employees.

Your state might have different or additional exemptions from these. Where employees are not eligible for workers' compensation benefits because of state exemptions, to collect equivalent benefits these employees might have to hire attorneys to sue their employers.

To be eligible for workers' compensation benefits, the injury, illness or death must have occurred in the course of employment. For example, a worker who is injured in an auto accident while driving home from work, likely won't be covered by workers' compensation insurance. But, a worker who is injured in an auto accident while making customer deliveries in a company-owned vehicle, is likely covered. In the latter case, the company's auto insurance coverage might offset workers' compensation coverage or vice versa.

"In the course of employment" might extend beyond performing job duties in some cases. For example, in some states, it might extend to employment-related functions such as company-sponsored parties, picnics and training, whether or not they take place on company property or during work hours.

Willful, self-inflicted injuries and deaths are typically not covered under workers' compensation insurance. Willful or not, neither are injuries and deaths caused solely by substance abuse on the job. A few states specifically cover injuries and deaths caused by violent behavior of other workers, while it's a matter of interpretation in remaining states.

An injury, illness or death doesn't have to be the result of a sudden accident to be covered by workers' compensation insurance. For example, if a worker's job requires repetitive motion that causes a physical disability over time, it's likely to be covered. Pre-existing medical conditions that are aggravated by job duties might be covered too. So might mental medical conditions, such as job-related stress.

When seeking medical attention and filing a claim for workers' compensation insurance benefits, be sure to follow your employer's or its insurance carrier's instructions. It's not uncommon for employers or their carriers to look for any excuse to deny claims for workers' compensation benefits, because such claims cost them.

However, if your employer or its insurance carrier does deny you benefits, you have the right to appeal or sue. More about appealing or suing is on the next page.

If your employer or its insurance carrier doesn't provide the claim forms, contact the workers' compensation agency in the state where you work.

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