Workers' compensation is a state-run system of no-fault insurance that pays medical costs and lost wages for employees who are injured or become ill because of their job.
Workers' compensation is an insurance system that provides medical care and wage replacement to employees who are injured or become ill because of their work, regardless of who was at fault. In exchange for these guaranteed benefits, employees generally give up the right to sue their employer for negligence. This trade-off is known as the exclusive remedy rule.
In the United States, workers' compensation is mainly governed by state law, so coverage rules, benefit levels, waiting periods and procedures differ from state to state. Federal programs cover certain groups, including federal employees under the Federal Employees' Compensation Act, maritime workers under the Longshore and Harbor Workers' Compensation Act, and coal miners with black lung disease.
Most employers must carry workers' compensation insurance or qualify to self-insure. Texas is the main exception, because private employers there can choose not to carry it. Employers that opt out, known as nonsubscribers, lose some legal protections if an employee sues them.
Premiums are based on payroll, job classifications and the employer's claims history. Many states use an experience modification rate (EMR) that compares an employer's losses with others in the same industry. A history of costly claims raises the EMR and the premium, and many clients and general contractors use EMR to prequalify contractors.
A strong return-to-work program helps injured workers recover and reduces wage replacement costs by offering suitable modified duty.
A workers' compensation claim and an OSHA recordable case are not the same thing. Each uses its own rules, so a case may be compensable but not recordable, or recordable but not compensable. Employers must apply the OSHA criteria in 29 CFR 1904 when deciding whether to enter a case on the OSHA 300 Log. See recordable incident.
Employees must be able to report injuries and file claims without retaliation. Many state laws prohibit retaliation for filing a claim, and OSHA's recordkeeping rule bars retaliation for reporting work-related injuries.
A warehouse worker injured her back lifting a heavy carton. She reported the injury to her supervisor the same day, and the employer filed a first report of injury with its insurer. The insurer paid for her doctor visits and physical therapy.
Her doctor restricted her from lifting more than 20 pounds for three weeks. The employer offered a modified role in quality checking within those limits, so she kept earning her normal pay and did not need temporary disability payments. The safety team investigated the lift and introduced a vacuum lifter for heavy cartons to prevent the same kind of musculoskeletal disorder from happening again.
Generally no. Benefits are paid regardless of whether the employee or employer was at fault, although some states limit or deny benefits in cases such as intoxication or willful misconduct.
Usually not, because of the exclusive remedy rule. Exceptions vary by state and may include intentional harm or employers that failed to carry required coverage. Employees may be able to sue third parties, such as equipment manufacturers.
Generally not, but misclassified workers may be treated as employees. Each state applies its own tests.
Deadlines vary by state. Employees should report injuries as soon as possible, and employers should report claims to their insurer promptly.
Part of SafetyIQ's EHS glossary: plain-English definitions of workplace health and safety terms.
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