Workers’ compensation, often abbreviated to workers’ comp, is a primarily state-based insurance system in the United States. Its primary purpose is to provide compensation and medical benefits to employees that are injured on the job or develop an occupational disease.
The various Office of Workers Compensation Programs (OWCP), administered by the U.S. Department of Labor, provide compensation related to wage replacement benefits, medical treatment, and vocational rehabilitation. Employers contribute to an insurance fund and employees can file a claim in the event of an accident at work or incurred medical expenses.
Workers Compensation Insurance Definition
Workers compensation is a type of insurance that is offered to employees when they experience an injury on the job. Depending on the US tate where the accident takes place, the requirements may differ.
Workers’ compensation insurance is compulsory for almost all employers in the USA (Texas is an exception) and companies that do not obtain enough coverage may be subject to statutory penalties. Policies typically include Part One for compulsory coverage and Part Two for non-compulsory coverage.
HR Role in a WCB Claim: Workers Compensation Insurance
Workers compensation claims affect many departments within a company. Health and Safety departments must perform regular risk assessments to reduce the likelihood of employee injury and WCB claims. The Legal department is responsible for contracting workers compensation insurance and managing any lawsuits that arise. Departmental managers also play their part as they must ensure their teams are fully trained and aware of the incident reporting process.
Human Resources is perhaps more involved than any other business area. Aside from making sure an injured employee receives medical care and is treated fairly, the primary role of HR is to develop and implement relevant policies and procedures in line with up to date work-related laws, including the ADA, the Family and Medical Leave Act, and any other relevant state laws and company benefit plans.
Workers Compensation Board – Filing a Claim
In the event of a workplace injury, an organization’s HR department must first report the incident to insurers. They must also communicate with the employee to administer a WCB claim in line with state and federal regulations and conduct investigations where necessary. In addition, records of all pertinent documentation, and supply information to upper management when requested, must be kept. They must also provide appropriate support and training once the employee in question is ready to return to work.
Workers Compensation Laws – Steps for Employers (Overview)
The workers’ compensation claims process can be complicated for all involved parties. If you get injured at work, you are responsible for reporting the accident or injury, and obtaining a medical examination and report from recognised healthcare professional. If an injured worker decides to file a claim, they must notify HR so that the health care provider or managed care organization can make a claim on their behalf.
Once a claim has been made, the employee affected by injury or illness needs to be clear about the workers’ compensation process. They should know when they could expect benefits, and what their responsibility is in terms of updating the company on their medical status and expected return to work date.
There are a series of steps that companies should follow to efficiently manage a claim.
Managing Workers’ Compensation Step-By-Step
Managing workers’ comp claims can be a time-consuming process. The process requires accurate and meticulous reporting and investigation as, ultimately, it is the responsibility of the employer to file all applications for workers compensation benefits.
Although the process varies from state to state, there are some general steps required in all jurisdictions:
Step 1: Employee Reports Incident – Workplace Injury.
The employee informs the employer that a workplace injury occurred. They visit a healthcare professional for a medical assessment and treatment.
Step 2: Manager Files Incident Report.
The manager or supervisor of the injured employee completes and files an incident report. Furthermore, they must ensure it is signed by the employee that has been hurt in work and any relevant witnesses. The report includes details such as date, time and location of injury; personal details of the employee involved; nature and severity of the injury; and details on how the accident happened.
Step 3: HR Documents Official Insurance Claim.
HR files an official claim on the employee’s behalf. The claim will go to with the company’s insurance provider and the state’s Workers’ Compensation Agency Office (WCAO).
Step 4: HR Conducts an Investigation.
Step 5: Monitor Employee Progress.
In the event an injured worker is unable to perform their duties, HR or occupational therapy departments maintain regular contact with the employee to monitor their progress and anticipated return to work date. For this reason, a workers’ comp tracking spreadsheets can be used to accomplish this task. However, if you want to streamline the process, monitor your employee’s progress through a performance management system. HR must also provide training once the employee returns to work, if required.
Step 6: Compensation Settlement.
The state WCAO determines if a claim is successful or if further investigations are required. If comp settlements are refused, employees can appeal to the WCAO.
How Does Workers’ Comp Work with FMLA?
Under certain circumstances, it can be possible for an employee to receive workers’ comp and FMLA leave consecutively. An example of this would be an employee who suffers a workplace injury or illness that is classed as a “serious health condition” under the FMLA. In this instance, the worker receives workers’ comp benefits and their time off is counted against FMLA leave.
What about in the event both compensation laws apply? In this case, the employer must determine which regulations provide the most benefits to the employee.
Workers Compensation Benefits & Best Practices
- Whilst most companies take preventative steps to safeguard working environments, accidents are unavoidable. It is therefore vital that HR departments comply with local and federal regulations. This ensures any injured employees receive pay and benefit entitlements and reduces employers’ liability for compensation.
- All workplace injuries must be thoroughly investigated and documented, regardless of whether or not a claim is made. Investigations should focus on gathering facts and reliable witness statements. Above all, companies that train their managers and supervisors on the importance of health and safety and WCB claims can support HR with this process. Moreover, it’s crucial employers know what to do in the event of an accident, and they are aware of the importance of reporting and documenting all incidents. They can also help determine whether a claim is valid or not.
The key to efficiently managing workers’ compensation claims is prompt reporting, company-wide training, thorough investigation, and good communication. A well-designed return to work program is also vital to ensure a smooth transition back into the workplace with minimum disruption to operations.
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Written by Cat Symonds; Edited by Tanya Lesiuk