When you suffer a personal injury on the job, you are normally eligible for worker compensation payments. Workers’ comp is an insurance plan that protects a worker’s wages and medical benefits if the worker is hurt on the job. In return, the worker agrees not to sue the employer for negligence. While we’ll concentrate on WC in the United States, similar programs are available in many countries. WC laws are enacted by the states, so the regulations vary across the country.
Protection for Workers
In general, if you are injured on the job, you are entitled to medical care and usually qualify for cash payments to offset the loss of income due to temporary or permanent disability.
Workers subscribe to WC by making small payments – usually handled as automatic deductions from paychecks. Except in Texas, most employers are required to participate in a WC program. Texas law allows firms to opt-out, but those that do are vulnerable to lawsuits. In most states, WC is administered by a state-level governing board. The actual WC insurance programs may be public and/or private. About a dozen states operate a public WC fund (California’s is the largest), and some states have exclusive control of the WC market. In most states, the state-run WC program is considered the insurer of last resort, so that private insurers have the opportunity to compete successfully. Private WC plans may reject insuring the worst risks.
Retaliation Not Allowed
In most states, it is illegal for an employer to retaliate against employees or potential employees who have reported a workplace injury or filed a WC claim, though sometimes it is hard to prove that discrimination has occurred. Some employers fight all WC cases, regardless of the merits. This supports a cottage industry of lawyers who specialize in contesting WC claims. Claimants may be limited by state law from paying more than a specified percentage of awards to legal representatives. This fee caps range from 11 to 40 percent in those states that have caps.
State administrative agencies usually handle WC cases – jurisdiction having been transferred from trial courts. Administrative law judges handle these cases. Appeals can eventually work their way into the state court system. In Ohio, state court appeals can be tried in front of a jury. There are three organizations in the U.S. that are very involved with WC regulation and education:
- National Association of Workers’ Compensation Judiciary
- International Association of Industrial Boards and Commissions
- American Bar Association
WC is increasingly becoming privatized, led by pioneering efforts in Nevada and West Virginia. Most states still provide for private and public WC funding.