If you work for a company that has three or more employees, your company has workers' compensation coverage, as required by law.
Workers' compensation was formed in the early 1900' as a "no-fault" policy to assist workers with medical expenses resulting from work-related injuries. It is a mandated insurance policy purchased by the employer to cover such expenses that may arise from such injuries.
Workers' compensation claims and benefits are prescribed by law. These are not company policies and, with the exception of how each company wants employees to report injuries, are not open to interpretation or changes by the company or employee. Employees and managers who understand that begin to realize that there are certain criteria already established to handling a work-related injury claim, including how much money may be paid out for a disabling injury. Both employer and employee are bound by the same criteria. It is not a decision made by the company nor can changes be made between companies within each state. That immediately lowers the risk of an employee feeling like he needs an attorney since the benefits are already prescribed in law.
Any work-related injury that may require medical attention must be reported by the employer to the state's worker compensation agency within a certain timeframe. This ensures that any medical costs incurred for treatment is known by the agency and the employer's insurance carrier and covered in a timely manner. This makes it critical for the employee to report any injury promptly so costs are appropriately covered.
Also, an employee in need of medical attention from a work-related injury must have an authorization form provided by the employer to give to the medical facility so the treating facility knows it is a work-related injury. This ensures the employee reports the injury promptly, the company recognizes and knows that a work-related injury has occurred, the employee knows treatment and any follow-up medical visits are covered, and the medical facility knows it will need to follow prescribed guidelines as well as know who to bill for the services rendered. This authorization form becomes critical and employees and managers must know how and when to provide the form.
Blank Check
A key point to communicate is that workers' compensation benefits do not establish a "blank check" for income replacement so an employee can stay at home for days or weeks at a time. There are some incidents that may happen at work that are general in nature rather than "work-related," meaning that the task being performed by the employee at the time of injury was not specific or unique to his assigned duties.
Examples of this are falling down stairs, insect stings or bites, bending over to pick something up - things that can happen away from work as well as at work. It may or may not be work-specific and, therefore, may or may not be covered under the worker compensation policy. These events are usually case-by-case, so be sure to report any injury sustained.
Misconduct
Gross misconduct by an employee may also not be covered by the policy. For example, an employee was denied workers' compensation benefits when he left his assigned work area and began "experimenting" with a chemical that was in another department. He was not trained, instructed or required to work with the chemical, but curiosity caused him to mix it with water, leading to an explosion and chemical burns to the is face, chest, arms and legs.
Since it wasn't his work area, he wasn't instructed in proper use of the chemical since his job did not require him to use it, and he chose to mix it in a dangerous way, worker compensation benefits were denied by the employer's workers' compensation insurance carrier. Since the accident occurred at work, the employee's health insurance also denied the claim.
The employee was left to pay for all treatment and all lost wages and lost time associated with the injury, and his wife lost wages from her job while she had a couple days at home to initially care for her husband. They missed their next month's mortgage as a result and had to take out a loan to cover the medical costs. That was an expensive lesson!
Communicate
Employers must take time to help managers and employees understand how worker compensation works in their states to avoid miscommunication, mistrust, misfiling and loss of benefits. Communication is the key between all parties involved. This includes open communication lines with the employer, employee, insurance carrier, treating physician(s), and the state's workers' compensation agency.
The workers' compensation process is in place to help maintain trust and assistance between the employee and the employer. Companies must know how to handle worker compensation claims and how to communicate its procedures and practices with employees and managers. Keeping this subject open with a willingness to discuss it minimizes the lawsuits and builds positive relationships that create a winning environment for everyone.
Sidebar: Things to Remember about Workers' Comp
- Compliance with prescribed medical orders, by both employee and employer, is required.
- Get a statement of injury from the injured. As part of the accident investigation, a narrative by the injured must be provided on what and how the injury occurred.
- Offer modified/restricted/light duty for return to work. Since workers' compensation claims do not immediately replace lost wages due to lost work days (generally a seven-day waiting period before starting wage replacement on day eight - employees lose the previous seven days), it is more prudent and shortens recovery time for the employee to return to work on a modified-duty status rather than remain at home
- Expect information requests. Often, there are additional questions that the workers' compensation insurance carrier may need to get answered while working the claim. An employee should not be surprised if an adjuster calls him for additional information. This is routine for the carrier and should be expected
- More claims equal higher premiums. Premiums are paid 100 percent by the employer, and like any insurance claim, the more claims filed under workers' compensation, the higher the premium can become. This can affect the company's overall bottom-line and things like employee bonuses.
- Filing false claims is fraud and is against the law, punishable by penalty and fines and/or time behind bars (for both employer and employee).
Sidebar: State to state differences
The following elements can vary between states:
- The waiting period between the time of injury and compensation for lost wages
- Review by a panel of physicians, depending on the state's requirements. This panel is made up of occupational physicians (not general practitioners) that can be chosen by the employer, then selected for treatment by the employee
- The amount of compensation awarded may vary from state to state, but what is important to know is that these amounts are prescribed in the law and cannot be made up or changed by an employer; nor can employee get more by hiring an attorney.
About the author: Randy DeVaul is a safety professional and consultant with more than 20 years of experience in safety/health and emergency response services. Mr. DeVaul presents management training seminars in worker compensation, confined spaces, emergency planning, performance safety, and others. He has presented formal papers to and is an invited speaker at national, regional, and state conferences. He is married with two children and resides near Richmond, VA. For more information, contact Mr. DeVaul at [email protected].