Workers compensation insurance, also called “workers comp,” is designed to protect employees’ wages if they are injured at work. Often, workers comp insurance also protects an employer from a liability lawsuit after a staffer gets hurt.
A worker’s comp settlement occurs when an injured employee is paid the wages they missed while recovering from an accident. Workers’ comp will also help to pay for their medical care.
Today we’ll consider workers comp settlements and explain how they work – from both the worker’s perspective and the employer’s view. Let’s begin by considering the common injuries covered by a worker’s comp settlement.
Types of Injuries Covered by Workers Comp (WC)
Work injuries can be acute – like a slip and fall accident that causes an employee to injure their back. Or they can be long-term injuries related to repetitive motion like carpal tunnel syndrome, a nerve injury related to office work and typing that occurs over years of repetitive motion.
Worker’s Comp Settlements – How They Work From an Employee’s View
Every employment situation comes with some risk. Some jobs are, by their nature, riskier than others. In the US, logging, construction, waste management, oilfield and extraction (mining) tend to be among the most dangerous jobs.
But an injury can happen at any workplace, even in an insurance office.
With that in mind, workers comp insurance operates under the concept of “no-fault.” That means employees don’t need to prove the company was negligent to win a worker’s comp settlement. You only need to confirm that the injury occurred while you were working.
Does Worker’s Comp Cover Car Accidents?
Yes, many car accident injuries are covered by workers comp and entitle you to a settlement for your missed wages and medical care.
- A car accident while riding in a company car
- A car accident in your vehicle but on company time, doing company work, like going to the post office
- An off-hours trip in your car that was required for work, like a trip to a physician’s office for your annual health exam or a quick trip back to the office to pick up paperwork
Ultimately, if the car accident happened because you were driving for your employer, workers comp insurance will be triggered, and you should be entitled to a worker’s comp settlement.
However – and this is key – your daily commute to work is not considered driving for work. If you’re in an accident on your way to work, but you’re not on the clock yet, WC would not cover this incident.
“Will I need a lawyer to collect a worker’s comp settlement?”
We hope not! Most WC claims are straightforward. Imagine a factory worker who cuts her hand open in the middle of her shift. She notifies her supervisor, who drives her to the hospital. Together they fill out the paperwork to get the worker’s comp claim started.
- Remember to keep copies of hospital paperwork, lab work, even receipts for extra purchases like bandages from the drug store.
In a straightforward situation like this, worker’s compensation should immediately kick in.
But sometimes, worker’s comp claims aren’t as straightforward. Imagine a chef who finishes his workday and clocks out. After returning home, he gets a call from his supervisor asking him to return to work because the restaurant is bustling.
Eager for some overtime pay, our chef returns to work but forgets to clock in. He cuts his hand open, but his supervisor denies calling him back to work. He was off the clock. There is no proof he was on the job. In a situation like this, the chef should call a lawyer.
Now that we’ve covered the worker’s comp settlement process for employees let’s talk about the process for employers and small business owners.
The Workers Comp Settlement Process for Employers
WC laws vary from state to state, and the paperwork differs slightly from one insurer to the next. Generally speaking, the worker’s comp settlement process goes like this:
- Help your injured employee get immediate emergency medical treatment. Drive them to the hospital or call an ambulance if needed.
- For minor injuries, allow your employee to leave work and seek treatment.
- Contact your worker’s comp insurance provider to document the incident.
- Fill out the required documents. Your WC insurance company will need to know details like the time and place of the injury and how it occurred.
- Provide your employee with information about worker’s comp insurance within 24 hours of the accident.
- Support your employee. Let them know they’re welcome to return to work as soon as they’re ready.
And now, you’re wondering how this workers comp settlement will affect your business.
One Worker’s Comp Settlement Won’t Affect Your Organization Much
The good news is that if this is a rare incident, it shouldn’t affect your business very much. Your worker’s comp insurance premiums might increase a little. But employees who receive cash benefits to cover their wages and medical bills and are welcomed back to the workplace in the same position / pay grade are far less likely to sue for negligence than those who don’t.
That’s why many workers comp insurance providers have a Return to Work policy (RTW). In addition to encouraging your trained employee to return to work as soon as possible, you reduce your costs of recruiting and training new staff. You also reduce the size of the worker’s comp settlement, and that’s important to the insurer.
Remember, you cannot discriminate against this employee for their injury. Even if you believe their injury was “their fault” or caused by “their mistake.” Worker’s comp is always a no-fault situation!
“What if an employee is taking advantage of worker’s comp or seeking a higher settlement than necessary?”
Insurance fraud is an unfortunate reality. If you believe your employee is exaggerating the injury or embellishing their medical bills, contact the WC insurance company. They have systems in place to fight this kind of fraud. They might ask the employee to see another doctor or interview him or her in person. Beyond that, stay out of it. Your job as an employer is to remain supportive and avoid any discriminatory behavior.