Workers' Compensation: Federal

Authors: Daniel O'Brien and Nicole Farley, Fisher Phillips

Updating Author: Brightmine Editorial Team

Summary

• Workers' compensation law is rooted in the legal concepts of no fault and exclusive remedy. Under a no fault system, an employer must compensate an employee who is injured or becomes ill due to the performance of job duties, regardless of who is at fault and with some exceptions. The concept of exclusive remedy requires employers to compensate employees (either directly or through insurance carriers) for injuries or illnesses that arise out of employment, but prohibits employees from filing civil actions against employers for injuries or illnesses. See No Fault and Exclusive Remedy.
• Most employers are required to have workers' compensation insurance coverage, though some exceptions apply at the state level. Similarly, most employees will be covered for any injuries or illnesses that are caused by or develop due to working conditions, but some exceptions apply depending on the employer-employee relationship and employee conduct. See Workers' Compensation Coverage.
• Employers can purchase workers' compensation insurance, self-insure against their workers' compensation liabilities or provide benefits to injured or ill employees directly, depending on state law and financial qualifications. See Types of Insurance.
• There are six major federal laws that provide workers' compensation benefits for specified injured employees. If an employer is not covered by one of these federal programs, state law will apply. See Federal Regulations.
• Only certain injuries and illnesses will quality for workers' compensation coverage, depending on how the injury or illness occurred, severity and whether the employee is forced to miss time from work. See Compensable Injuries.
• Workers' compensation benefits include wage replacement for employees who are injured or who become ill and are forced to miss work. Wage benefit calculation and payment methods vary from state to state, but the majority of compensation paid involves temporary total disability, permanent partial disability, permanent disability and/or death benefits paid to families of deceased workers. See Amount of Compensation.
• Workers' compensation benefits also include compensation for or payment of medical bills generated by treatment necessary to address injuries or illnesses that result from the performance of job duties. See Medical Benefits.
• It is critical for employers to properly investigate and document their findings pertaining to injuries or illnesses that are related to the performance of job duties. See Investigation of an Injury or Illness.
• Supervisors play an important role in preventing incidents that give rise to workers' compensation claims and managing the process of a workers' compensation claim. A supervisor's actions can minimize or exacerbate an employer's exposure to workers' compensation claims. See Supervisor Responsibilities.
• Employers must be wary of employees who exaggerate their injuries or illnesses, falsify claims or otherwise abuse the workers' compensation benefits system. See Preventing Fraud.
• Employers can contest workers' compensation claims for several reasons, many of which depend on the employer's location and corresponding state law. See Reasons to Contest Claims.
• Getting and keeping workers' compensation insurance is a large expense for employers, but there are several methods employers can use to reduce workers' compensation costs. See Reducing Claims and Costs.
• Workers' compensation claims typically do not operate in a vacuum. Employees that suffer a work-related injury or illness may have rights under other statutes such as the Family and Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA). It is crucial that employers are aware how these regulations overlap and interact in order to be in compliance with the law. See Interplay With Other Laws.
• Once a claim is made, state law will determine how it is administered, whether benefits are appropriate and to what extent, and what types of appeals an employer or employee has at their disposal. See Enforcement, Administration and Appeals.