Workers Compensation is a method used by employers to compensate an employee who becomes injured at work or who contracts an Occupational Disease.
By law, most employers are required to provide workers compensation for their employees. There are few exceptions and each state is going to be a little bit different.
Workers Compensation came about as a result of industrialization where large numbers of people began to work for employers. Before Workers Compensation, an injured employee would have to sue their employer and try to prove that the employer was negligent in some way.
This was also a time in which there was no health insurance, no accident insurance and no disability insurance to help absorb the cost.
As a result, states began passing laws requiring employers to provide a Workers Compensation. These laws have evolved into our current system today.
The goal of Workers Compensation is to protect workers and their families who rely on their income from financial ruin as a result of a work related injury or Occupational Disease.
This is done by providing the following Benefits.
Death and Survivor
Some states mandate that the Rehabilitation be considered a benefit payable under Workers Compensation as a separate benefit or it may be included under the Medical Portion.
Medical Expenses are usually offered on an unlimited basis as long as they are reasonable which is determined by the states.
Disability Income is where most people have questions. The disability income is not meant to replace the workers income while they are recovering. In most cases of a partial disability (the most common type of injury) the worker is paid a percentage of their income. Usually about 66%.
Death & Survivor Benefit is paid out in the event that a worker dies. The benefit is paid to the dependents of the worker. The amount paid is subject to State laws and will vary slightly.
Workers Compensation does not cover Fines or Investigative Costs by regulatory agencies such as OSHA.