Limits of the Worker's Compensation System
By Sean Oswald of Strong Law Offices posted in Workers' Compensation on Friday, August 1, 2014.
The Worker's Compensation Act provides relief for injured workers on a no fault system. This means that it is not necessary for the injured worker to prove that the employer did anything wrong in order to receive compensation. This makes it much easier than it might otherwise be for the injured worker to receive benefits. There is however a trade off for this standard. The Work Comp Act serves to make it so that more employees who are injured receive benefits but it also works to reduce the amount of those benefits.
Your benefits under the Work Comp Act are limited in 3 primary ways.
First the Respondent is only obligated to pay 2/3 of your actual lost wage and it is further reduced if some of your income was from overtime.
While these benefits are paid without taxes being withheld they are often significantly less than your pre-injury take home pay. This can mean that even when the Respondent is doing everything they are required to by law that you may still have trouble paying your mortgage, buying food, etc... and the longer the claim goes on the further behind you can end up. Critics of the work comp system often seem to act as though the TTD you are paid is a gift- but in reality it is meant to replace your lost income. Income you would not have lost but for an injury you sustained while working.
Second the Respondent is not obligated to pay for the value of your benefits such as vacation pay, 401k, health insurance etc...
In today's world, the value of benefits is often the reason that a person takes any given job. Health insurance is of almost tremendous value, and to find out that once you were injured your company does not have to pay for such benefits is a slap in the face. Yet, the law specifically excludes such benefits from being considered as part of your compensation. This effectly lessens the value of compensation received by any employee by an average of 1/3.
Third, the Respondent is not obligated to pay you for your pain and suffering only for the cost of medical treatment and for your lost income.
The same injury that arises from a car accident as from a work comp claim may produce a significantly higher settlement in compensation because a personal injury settlement can consider your pain and suffering whereas the work comp settlement can not. This again is part of the trade off to lower the value of each claim in exchange for increasing the number of employees who will be able to receive benefits, reduced as they are.
These trade- offs serve to lower the compensation that you can receive for your injury. They make it all the more important that you have legal counsel to fight for you. It also raises the point that, if you are afforded the opportunity to talk with your state representative or senator that you let them know the ways in which work comp is limited and how employers benefit from these limitations. There is currently a lot of pressure being placed upon legislators by business interests to further limit the claims under work comp and it is important that your representatives be reminded that they work for you.