WORKER'S COMPENSATION: DISCUSSION, TERMS AND DEFINITIONS

Introduction. The following definitions are not intended to be absolutes or to be used as a basis for making a determination about any individual case. Every state has laws governing the terms and concerns below, and often cases go to court to seek resolution of differing opinions on the meaning of these terms. As well, this list is not intended to be exhaustive. There are numerous issues which come into play in determining worker's compensation issues, and it would be impossible to address them all here. I encourage you to contact me to discuss your specific questions.

While state statutes govern the procedures and benefits payable to injured workers, typically these claims are handled by an administrative agency specially appointed to do so. The process of making claims includes requirements for notices to be sent, deadlines in which these notices must be sent, the potential for hearings for disputed matters, and reviews and appeals of these rulings in the event the worker is not satisfied with the results.

DUTY TO INSURE OR SELF-INSURE. States' laws will vary, however, generally, when an employer has three or more employees, he or she is required to obtain worker's compensation insurance for all of its employees, or to self-insure. This law is mandatory and an employer who fails to comply normally will be subject to both civil and criminal penalties.

EXCLUSIVITY OF WORKER'S COMPENSATION REMEDY. Generally, a worker has only one financial remedy if he or she is injured on the job. That remedy is set out in the various states' laws which detail the scheme of Worker's Compensation. The worker cannot decide to sue the employer, even if the employer was negligent. The laws are a compromise. The worker gives up the right to sue for "full damages" which include pain and suffering, and agrees to accept an amount set out by law. In so doing, the worker has more security in the certainty of payment, and he or she gets a simple and streamlined resolution. The employer gives up his or her right to defend the case, or otherwise deny responsibility, and in return avoids the possibility of having to pay potentially higher damages were the matter to go to court on a contested basis.

EMPLOYER. Someone who has the ability and the power to control the worker's action and direct his or her work.

EMPLOYEE. Anyone, including a minor, who is in the service of another by contract of hire, whether that contract is written, verbal, or implied, and who is in the "usual course of the trade, business, occupation or profession of the employer. Contract as used means an agreement. Hire as used means some form of payment. Benefits for injuries are limited to "employees". The term employee is thus the basis for many cases which attempt to distinguish the worker's status, as if the worker is determined to be an Independent Contractor, the employee will not have to pay benefits. Many employers in fact attempt to label their workers as Independent Contractors, and therefore don't pay social security taxes, don't withhold taxes, don't pay unemployment taxes, and don't pay worker's compensation insurance premiums. The law allows the deciding officer in a worker's compensation claim to disagree with the employer's characterization. Not paying taxes is not necessarily determinative.

INDEPENDENT CONTRACTOR. An independent contractor is someone who performs a job for another, but is free from the control of the other regarding the details of the work to be done.

ACCIDENT. An injury by accident is one which typically has three necessary parts. The first is that it must come from some identifiable incident which occurs within a specific time range. Back pain occurring on Friday after lifting heavy boxes the preceding Monday typically would not qualify. The second requirement is that there is some mechanical or structural change in the body. The third element is that there must be a causal connection between the incident and the bodily change.

OCCUPATIONAL DISEASE. A disease arising out of and in the course of employment. It is not an ordinary disease of life which the general public is exposed to outside of this worker's employment. Many state laws have very detailed discussions of this term, and they generally concern themselves with concepts of causal relationship and exposure to the disease, which is common to the trade or occupation of the worker. Typically fire-fighters and police who suffer respiratory or heart disease are presumed to have contracted these ailments from the job, and they are covered as "occupational diseases".

COMPENSABLE INJURY REQUIREMENT. In order for an injured worker to receive benefits, he or she must have been injured from an accidental injury or occupational disease arising out of and in the course of his or her employment.

ARISING OUT OF... EMPLOYMENT. The injury was caused by a risk to which the worker was subjected by his or her employment. The test is whether there is a connection between the injury and the conditions under which the work was to be performed. 

IN THE COURSE OF (or scope of)... EMPLOYMENT. This term involves considering the time, place and circumstances of the accident in relation to the employment. If a worker is injured during the period of employment, at a place where the worker is reasonably expected to be, and while performing duties reasonably required by his employment, or if the worker is performing a task reasonably incidental to the employment, then there typically will be coverage. There are extensive court decisions which discuss issues such as coffee breaks, company picnics, and walking from the parking lot to the plant or office.

BENEFITS ENTITLEMENT.

Introductory Note: Each state has "caps" or limits on the total amount of funds that can be paid under any entitlement benefit. Please feel free to call my office to discuss the particulars of your case.

1) MEDICAL COSTS AND VOCATIONAL REHABILITATION. Typically, all reasonable and necessary medical care costs are paid, including medications, medical appliances and prosthetic devices. Responsibility for these payments continues for as long as it takes for the worker to reach "maximum medical improvement". Typically again, the employer's worker's compensation insurer can require that medical care be obtained from physicians of its choosing. As well as providing medical care costs, re-training or vocational rehabilitation must be furnished to the injured worker.

2) TEMPORARY TOTAL DISABILITY. The worker is losing money because he or she cannot work, due to being injured on the job. Lost income benefits while the worker is out of work and under active medical care are generally paid at two-thirds of the average weekly wage the worker was earning prior to suffering the injury. Being out of work requires medical permission, and once the worker is said to have reached "maximum medical improvement", he or she will usually be required to return to work, and benefits will stop. Disputes often arise as to whether the worker is still disabled, and whether or not he or she has reached "maximum medical recovery".

3) TEMPORARY PARTIAL DISABILITY. Often workers are recovered sufficiently to return to do some work, while they are still on the road to complete recovery. They are thus temporarily limited in the amount or the type of work they can do compared to their pre-injury work. Benefits here are usually paid at two-thirds of the difference between what is being earned and what was being earned prior to the injury.

4) PERMANENT PARTIAL DISABILITY. Benefits are awarded for certain types of injuries which do not cause the worker to be totally unable to work There are many different ways inwhich permanent injuries are treated, and rate structures differ as well. In addition to the loss of, or the loss of the use of a specific body part (amputated leg, for example), this category includes disfigurement or scarring, and typically the disfigurement does not need to impair the worker's ability to work.

5) PERMANENT TOTAL DISABILITY. An injured worker must show that he or she cannot return to work in any capacity, and that the problem is permanent. Benefits are often paid to workers whose injuries allow them to work only occasionally, or whose work would be undependable because of the nature of the injury. As well, consideration is often given to a worker's age, education, and experience in determining if he or she can return to employment.

6) DEATH. State laws will typically define "dependents" of the deceased worker. Only these individuals are entitled to receive benefits, and typically these are calculated based on the wages the worker earned, upon which the dependent or dependents relied, and would have relied had the worker not passed. The focus of payment is not based upon mental pain and anguish, or grief, due to the passing of the worker. It's purpose is to replace lost income. The rate and amount for dependents varies by their relationship to the worker, and dependents who are partially dependent would receive proportional payment.