Employees hurt themselves on the job — that’s a fact of life. Whether it’s a dropped laptop that breaks someone’s toe or a major industrial accident that sidelines an employee for months, companies have to assume something will happen and take steps to protect themselves and their employees.
Workers’ compensation is essentially a mandated insurance program that covers employers. The laws generally operate on a state level and can vary widely. However, as the Nolo legal website says, all states typically impose insurance plans that allow any employee with a work-related illness or injury to obtain certain benefits no matter who was at fault. In exchange, employees lose their rights to sue their employers for damages for those injuries — a provision that could save employers millions of dollars. (However, employees may still be able to sue if an employer’s actions were reckless or intentional.)
The Legal Information Institute, run by Cornell Law School, explains that state rules often limit the amounts of awards in specific situations, and can limit employer and co-worker liability in order to save on expensive and time-consuming litigation. It further notes that workers’ compensation laws can also provide coverage for the families of workers who were killed by a job-related accident or illness.
Employers are well-advised to see what their state’s rules are. For example, in New York, injured workers who can return to work, but who now earn less money because of the injury, may find that workers’ compensation rules entitle them to much of the difference between what they had been earning and what they are now earning.
Texas, however, is unusual in that it allows companies to opt-out of the system. However, it does warn these “nonsubscribers” that they could be leaving themselves open to enormous lawsuits that the compensation plan would’ve limited.
In any state, rules and exclusions can be complex, so it’s wise for companies to find out what is applicable in their jurisdiction, for their own protection and the protection of their employees. The U.S. Department of Labor maintains a list of links to each state’s workers’ compensation site.
ConnectPay works with local brokers and has options for Pay-As-You-Go workers’ compensation plans. For more information click HERE.