WEDNESDAY, SEPTEMBER 15, 2021
It’s important to note that employees are not the ones to pay for workers compensation. Workers compensation should not come out of an employee’s paycheck, but instead is paid by the employer or entity of employment. Employers have a duty to their workers to provide workers compensation insurance in case a worker is injured on the job.
The cost of workers compensation depends on the company’s location, industry, payroll and claims history. Certain industries, such as construction, cost more to insure due to the high likelihood of injuries. States also have different requirements for workers compensation. Some states such as Ohio and North Dakota require businesses to purchase workers compensation through a state fund while most other states require businesses to buy workers compensation from insurance agencies. Texas does not require workers compensation insurance while Florida businesses with four or more employees must carry the insurance.
Workers compensation is calculated depending heavily on the company’s payroll. In Texas, businesses may pay $.57 for every $100 covered in payroll. The average rate of workers compensation in 2016 was $1.30 for every $100. Companies with a history of claims may also pay more in workers compensation insurance, as they’re seen as more likely to file.
The four areas of coverage under workers compensation are medical treatment, vocational rehabilitation, disability and death services.
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Medical treatments cover hospital, emergency and basic treatment expenses.
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Vocational rehabilitation covers the cost of tuition or training if an employee cannot come back to their previous job or industry due to the injury.
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Disability covers both short-term and long-term disability as well as covers part of the employee’s lost wages while they are unable to work.
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Death services cover funeral expenses and provide compensation for the employee’s family in the unfortunate case that the employee passes away due to a work-related injury.
The amount and type of compensation offered depends on the nature and extent of the injury. Smaller injuries like a twisted ankle may only cover the medical treatment. Other injuries such as permanent eyesight loss may qualify the employee for permanent disability benefits. In these cases, workers compensation insurance may pay benefits to the employee for the rest of their life.
General instances that a workers compensation claim might be filed includes workplace violence, terrorist attacks, work-related illnesses and natural disasters. Workers compensation does not cover:
What Percentage of Wages is Workers Compensation?
Compensation depends on the severity of the injury and the worker’s wages. In some states, the compensation may include the amount of money your employer contributes to employee benefits if they no longer pay for your health insurance. For temporary total disability, you generally receive 66.67% of your wages. This is generally paid weekly, while medical bill coverage occurs at the time of payment. Other disability payments vary.
Workers compensation is crucial for any business. Medical expenses can stack up quickly, and employees may sue after being injured on the job. Even if your company offers group health insurance, employees are free to seek compensation for work-related injuries whether the injuries were due to negligence or not. Workers compensation does not cover legal fees for the employer or company, but it can prevent lawsuits by ensuring that employees receive the medical compensation they need. Take careful preventative measures to keep employees safe and your company safe from possibly disastrous injuries.
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