Workers' Compensation Benefits
Common elements. Here are some common elements shared by the state
workers' compensation laws:
- Benefits are provided for accidental job-related injury — an
employee is entitled to statutory benefits from you when the individual
suffers a "personal injury by accident arising out of and in the course
- Benefits include wage-loss, medical, and death benefits —
wage-loss benefits usually cover about one-half to two-thirds of the
employee's average weekly wage.
- Covered "employees" are defined by law —
"employees" generally does not include independent contractors.
- Fault is generally not an issue — neither the employee's own
negligence in causing the accident nor your complete lack of fault are
factors in deciding whether the worker gets benefits.
- Employees give up the right to sue you — in exchange for the
assured benefits, employees give up their right to sue you for any injury
covered by workers' compensation laws.
- Employees retain the right to sue negligent third parties — if a
third party's negligence helped cause the accident, the employee can still
sue the third party; any proceeds from the suit should be first applied to
reimburse you for benefits paid to the employee.
- The system is administered by a state agency — the responsibility
for administering the system is placed in the hands of a state agency.
- Most employers are required to participate — except in Texas and
New Jersey, which have voluntary systems.
You should remember that workers' compensation benefits are payable only for
work-related injuries. Benefits are not available for self-inflicted injuries or
for those caused by intoxication or substance abuse. The payable benefits
- income replacement for partial or total disability of a temporary or
- medical and rehabilitation costs
- survivor benefits in the case of a fatal illness or injury
In addition, coverage is provided for certain occupational diseases that are
set out in the state laws.