Before this article dives further into workers’ compensation and everything it encompasses and covers, let’s first define it. So what does it represent? It is also known as workers’ comp and it offers numerous benefits to employees who sustained any injuries or illness at work.
In these types of situations, it covers a variety of different things like medical expenses, a certain amount of money for lost wages, healthcare benefits, disability pay, and educational retraining.
Workers’ compensation is financed by the Workplace Safety and Insurance Board (WSIB) and the benefits it offers can vary, depending on the state it’s been issued. Now, that the basics are covered, below, more information is going to be unveiled.
The Importance Of Workers’ Comp For Workers
As stated previously, this type of insurance can be extremely beneficial for employees who were injured or got sick at work. It helps them (while they take a break from work) by offering them numerous benefits, such as:
- Partial wage replacement
- It covers medical expenses that are related to the workplace injury, accident, or illness
- Temporary and permanent disability
- Occupational and rehabilitation therapy
- Compensation to beneficiaries if by any chance the worker loses their life at the workplace
- Displacement benefit that provides for skill enhancement
Every single state is equipped with a Workers’ Compensation Board, which represents a state agency that supervises the program, and intervenes if there are any issues and disputes. Besides that, there’s also Federal workers’ comp which is a program that covers energy and federal workers, along with harbor and longshore employees.
Workers’ Compensation By The State
If, as an employer, you want to use workers’ comp, you first need to do your homework to find out all about the requirements when it comes to the state you live in, or you can always consult a licensed agent.
As concluded above, each state has different requirements and penalties as far as this type of insurance is concerned. Almost every state demands employers to offer workers’ compensation insurance to their employees.
Normally, the number of workers is the one that determines whether a particular company is obligated to provide workers’ comp or not. In most cases, it’s mandatory as soon as a business owner hires somebody.
Below, this guide is going to mention a few states and how they implement this type of insurance. For example, when it comes to the workers compensation insurance in California, it doesn’t cover deputy clerks, deputy sheriffs, amateur sporting event officials, domestic employees who were hired by their parents, child, or spouse, or volunteers for non-profit recreational camps. If an employer doesn’t offer workers’ comp, it’s perceived as a criminal offense, which may result in jail time, a hefty fine ($10,000 or above), or both.
On the flip side, when it comes to Pennsylvania, it doesn’t cover casual workers. In this state, intentional noncompliance is perceived as a felony, which can also result in jail (up to seven years) and/or a fine of $15,000.
Furthermore, there are states that have workers’ compensation state funds, which means that employers in these states are forced to obtain workers’ comp from the state fund, which is then defined as a monopolistic state fund. This refers to:
- Ohio
- North Dakota
- Wyoming
- Washington
It’s worth mentioning that if this type of insurance is purchased from a monopolistic state fund, then it’s not going to come with an employer’s liability insurance. This insurance normally safeguards against lawsuits in which an employee claims that they’ve been injured at work and that these injuries were a direct result of an employer’s negligence.
Different Types Of Workers’ Comp
There are two main types of workers’ compensation coverage and they include Coverage A and Coverage B. When it comes to coverage A, it involves different mandated benefits that an ill or injured worker is obligated to receive from the insurance.
It covers medical care, salary replacement payments, rehabilitation, and death benefits. Every single state in the United States except Texas provides these benefits, even though they can vary from state to state.
As far as Coverage B is concerned, it pays the benefits that surpass the minimums demanded by the above-mentioned coverage. They are typically paid only if the worker who filed a lawsuit against their employer (because they were negligent) won the case.
Employees who agree to have a workers’ comp usually do not have the right to sue their employers, because they’ve accepted a no-fault agreement. However, there are states in which court rulings restored this right to sue the employer but only in particular circumstances.
In other words, an employer has the right to acquire a policy that represents a mixture of both Coverage A and Coverage B.
Steps That Must Be Taken If An Accident Occurs
If by any chance, an accident happens within your organization, as an employer, you are obligated to take two crucial steps. They include the following:
- You are obligated to file an accident report with a specific workers’ compensation agency in the state you operate your business
- It’s your duty to treat every work-related injury as legitimate, even if you’re suspicious about it (referring to the circumstances that led to it)
Every state comes with different laws when it comes to the requirements for filling an accident report. In these instances, the state agency is the one that’s going to determine when you’re supposed to file it.
Moreover, it’s going to decide whether you should pay anything to your worker. Why is it essential to perceive accidents as legitimate? Even though this type of compensation law safeguards you from lawsuits for workplace injuries, it doesn’t mean that they are going to protect you one hundred percent from them.
For instance, your employee could sue you because you didn’t offer them the workers’ comp benefits, however, if you treat every accident as legitimate, you are going to lower the chances of being sued.
As you can see, there are many aspects of this type of insurance that must be understood if you want to properly comply with all its rules and regulations. We honestly hope that things are a bit clearer after this article.
