Workers’ compensation coverage provides protection for everyone involved in a work-related injury. As an employer, you are protected from paying for medical and other financial losses for your injured employee.
The employee is also protected. If they are hurt on the job and have to miss work time, then it can be an incredibly stressful situation. If you have provided them with workers’ compensation coverage, they won’t have to worry about their medical and rehabilitation bills or missed wages. Instead, they can focus on healing and getting back to work.
Not only all that, but workers’ comp also protects society at large. Millions of people get hurt at work in the United States every year. If even a fraction of those employees took their employers to court, the system would be overloaded. Workers’ compensation makes sure that those workers are protected and prevents the need for the courts to get involved.
However, everyone involved must understand the criteria for receiving workers’ compensation. If they are not met, the employee might not be compensated, leading to difficulties for them and possibly the employer.
The Injured Party Must Be An Employee
While it might seem like a simple concept, it can sometimes be challenging to determine who is classified as an employee. The rules may be different depending on what state you are in. A good general rule of thumb is that if an employee is required to work certain hours at a particular location, they qualify. This is true whether they are part-time or full-time employees. That location could be anywhere, including their own homes if they work remotely.
If you use contractors, you do not have to provide workers’ compensation for them or their employees. Contractors set their own hours and expectations and do not qualify for workers’ compensation. However, they will have to provide it for their workers and possibly for any subcontractors, depending on state regulations. If you are unsure, always check with your state’s workers’ compensation authority. That way, you will know who needs coverage and who doesn’t.
The Employer Must Have Coverage
Every state except for one requires all employers to provide workers’ comp. However, being mandated does not mean that all employees are automatically covered. Employers must fulfill their legal requirements by enrolling in a workers’ comp program. It works much like any other insurance policy. The employer pays a premium based on how many employees they have and their risks. In turn, they and the employees are covered if something bad happens.
Remember, having workers’ compensation will protect you as well. It is not a cost that you should think about eliminating from your budget. You might think that your workplace is incredibly safe, but anything can happen that you do not expect. If you take chances by not having workers’ compensation, then you risk not just the potentially hundreds of thousands of dollars in costs out of your own pocket but also legal repercussions. So do not take the chance. Make sure that everyone is appropriately covered.
If you don’t have coverage, then an employee can opt to sue you for their financial losses, plus pain and suffering and whatever else a judge may award them. You will have to pay for your lawyer costs, plus witnesses and experts, and then there is the risk of paying out damages. Having workers’ compensation in place will ensure that you can keep your business even if an unfortunate situation occurs.
The Injury Must Be Related to Work
For workers to be protected by workers’ compensation, their injury must be work-related. For example, a repetitive stress injury from doing yard work does not qualify. However, typing at your desk for hours and days on end, leading to arthritis or other afflictions, would be eligible. Unfortunately, some workers will try to claim that an injury they suffered on their own time is a workplace injury.
The courts are also starting to recognize that work can result in stress and mental trauma. Workers’ compensation can also cover these conditions if proven to be a result of working. This can be very hard for employees to prove, however. Another gray area is commuting. If an employee is injured on a commute to or from work, they most likely are not covered by workers’ compensation, but there may be some scenarios where they are. As always, it’s best to check with your state’s workers’ comp authorities.
All Deadlines Must Be Met
Most employers want their workers to get the compensation they deserve for getting injured on the job. However, one thing that could prevent that is filing a claim for benefits within the correct time frame. If they do not meet the deadline, they could be left without benefits.
As an employer, this could put you in a tough spot. For one, morally, you want your workers to be protected. However, if workers’ compensation no longer covers them because of a missed deadline, you would have to pay for it yourself if you wanted them to get compensation. Unfortunately, most small businesses cannot do this without taking on significant financial risk.
There are, in fact, two deadlines. One is for when they report the injury or illness to you as the employer. Most states have a very short deadline that’s usually within a few days up to a month. The other deadline is for filing a claim, which is generally up to a year, but it is two years in some states.
The Employee Must Attend Their Required Medical Appointments
Injured employees must attend any required medical appointments. This is important for their recovery, of course, and to show that they are genuinely injured. However, if they are canceling and rescheduling appointments, your insurance provider may assume they are trying to defraud them. Unfortunately, workers’ compensation fraud costs insurance providers billions of dollars every year, so they will take every step possible to prevent it.
There is no reason for you not to have workers’ compensation for your business. The law in most states requires it, and it is only right that your employees are protected from maladies suffered while working to grow your business. Ensure that you have it in place and understand the criteria so that there are no errors or misunderstandings if something bad happens to an employee at work.
