Since the early years of the 20th century, whoever had a job in the United States benefitted (or at least heard of) workers’ compensation insurance. The system still works. The employer pays the workers’ comp, and the coverage helps all workers to protect their financial interests in case of work-related injuries or illnesses occurring in the workplace and through no fault of their own. The system has plenty of advocates and plenty of detractors. Today, we will discuss the pros and cons of workers’ compensation that all new employees should consider before signing it.
How Does Workers Compensation Work?
If you are fresh on the job market, you may feel happy about a company offering workers compensation in case of a work-related injury, illness, disability, or even death. In these times of trouble, workers’ compensation covering potential COVID-19 infections while essential workers are on the job is a godsend for many employees. In general, this type of insurance makes people feel safer, and companies more trustworthy.
In other words, you can qualify for a workers compensation claim if you are injured or become sick because of the job you are doing. One issue that most people worry about is the idea of “fault” for their injuries or accidents in the workplace. However, it is less about fault but about the fundamental premise of this insurance policy: all personal injury claims, illness, debilitating conditions, or death should always (and without a doubt) relate to your workplace. In some cases, workers compensation can cover a slip and fall accident in the office during your working hours, but may not cover a slip and fall accident in front of the office building during your lunch break.
As almost any law in the United States, workers’ compensation rules and guidelines vary across states, although the federal government runs its own separate program. Workers’ compensation laws usually cover most employers, but almost all states have exclusions and limits. If you are new on the job market and you find workers compensation an attractive incentive offered by a potential employer, check the state laws first.
Workers’ compensation practically pays the medical bills and loss of wages due to work injuries. In some cases, it can also provide benefit payments for the family in case the worker dies during employment. What you should know is that the law guarantees workers’ compensation in case of workplace injury, although some would prefer having the right to sue the employer. The system eliminates, as we said, the element of negligence or causation. Regardless of the root cause of the accident or injury, workers comp will most likely pay whether the employer or employee was at fault.
The Pros and Cons of Workers Compensation
As a new employee on the human resources market, you may find workers comp appealing. However, it would be best if you considered all its pros and cons before accepting it. So let’s lay them down for you!
Advantages of Agreeing to Workers Compensation
· In case of an injury or illness related to your job, the policy covers wage replacement for days off work, compensation for future wage losses if applicable, reimbursement for medical bills, benefits for the family in case of the employee’s death;
· In times of the pandemic, agreeing to workers’ comp may be the safest and wisest thing you have ever done; while legislation is still a work in progress, for people and families having to work during the pandemic, this insurance is a safety net;
· In most states, the law also protects the employees from retaliation in case they file a workers’ comp claim;
· It eliminates the stress, costs, and length of litigation. Since workers’ comp forbids employees to sue, you will gain either a lump sum or weekly/monthly payments without relying on the courts to solve your case. Litigation can take months or years.
· The system makes the workplace a safer environment. Since employers’ compensation payments increase together with the number of filed claims, all employers struggle to make the workplace safer, thus avoiding accidents and injuries in the first place. While some employees could still claim unsafe labor conditions, if the employers follow OSHA’s rules and guidelines to a tee, the workers will not likely have a case.
· It protects employees physically and financially;
· The insurance saves workers the burden of proving the employer’s negligence, thus saving everyone a lot of time and money.
Since the system works for years and nobody seems to want to make changes to the status quo, it means that it works. But does it, really? It is time to discuss the cons of workers’ comp insurance so you can make an educated choice before you agree to it.
The Disadvantages of Workers Compensation
· Once you signed a workers’ comp agreement, you forfeit the right of suing your employer. While nobody wants to go to court, in some cases, you should. Workers’ comp does not cover pain and suffering damages, punitive damages, or other compensation for an employer’s gross acts of negligence (with some exception at the state level);
· The employer can dispute the claim. If workers’ comp claims pile on the desk of an employer, the insurance costs rise exponentially. For this reason, the employer might dispute your claim. It means that you might have to go to court, pay legal fees, and wait for years until you get the money you deserve and need;
· The system is vulnerable to fraud. You should know that some people try to rig the game by fabricating or exaggerating their injuries/illnesses to get workers comp. This state of facts cause harm not only to the employer in question but generates economic and social adverse effects;
· You have to file your claim within the state’s deadlines and regulations. Failing to respect the timeframe for claim filing may disqualify you;
· Most likely, you will need a lawyer to help you file the claim, reach a settlement with your employer, or even assist you in court in case of a dispute;
· In case of a severe injury or illness, workers’ comp will not even begin to cover your medical costs, pain and suffering, unemployment, and so on. If you work in a high-risk environment, read the policy a couple of times with a lawyer by your side. A broken arm is one thing. Occupational cancer is quite another;
· If your employer keeps you off the books, you are not getting workers comp, so make sure your employment is legal and clean.
We live in troubled times, and the future doesn’t look so bright. In general, employers who offer workers’ comp will also do everything in their power to help you. Nevertheless, before you go on your merry way at your new job, read the state’s laws regarding this policy and have a lawyer consult you on the pros and cons of the worker’s comp you are about to sign.