Don’t Bypass Workers’ Compensation

By Angela Stone

Q: We have an employee who suffered a minor injury at work and missed a few days of work as a result. Could we just pay the person for time missed instead of filing a workers’ compensation claim?

A: No. Employers are required by federal and state law to report injuries in the workplace and can face stiff penalties for noncompliance.

Most employers are required by law to provide workers’ compensation coverage for their workers. Workers’ compensation insurance benefits both employees and employers. It provides employees with essential medical care, replacement wages and disability benefits. For employers, it is the exclusive remedy for work-related injuries, which prevents an employee from seeking further damages through a separate lawsuit and limits the amount of benefits the employee may recover. It also helps the employer by limiting its disability benefit planning to illnesses/injuries that do not occur on the job.

Some employers are concerned that reporting too many injuries to their workers’ compensation carrier will affect their insurance/experience rating, which is why they sometimes consider not filing a claim and paying the employee’s expenses out-of-pocket. While some minor medical bills could potentially be paid out-of-pocket, employers are still required by federal and state law to report these injuries and failure to do so can lead to citations and civil penalties.

When employers do not file a claim with their workers’ compensation carrier, they leave themselves open to the possibility of lawsuits by injured workers, which most likely would lead to larger expenses for the employer. Workers’ compensation carriers have extensive resources that help manage the care an employee receives and work for both the employer and the employee in ensuring that the workers receive the care they need.

Filing injury reports can also help determine whether other factors were an issue and help employers remedy any safety concerns, as well as confirm whether the injury was work-related or whether the employee is making a fraudulent claim.

Prompt and proper reporting of work-related injuries through the employer’s workers’ compensation carrier not only protects the employer from future liability but is also the best way to protect employees and provide the medical care and benefits needed to return an injured employee to good health and back to work.

Angela Stone, SPHR, is an HR Knowledge Advisor in SHRM’s HR Knowledge Center

DOL Regulations – On July 21, 2008, the Department of Labor (DOL) released a proposed regulation governing fiduciary disclosure requirements in participant-directed individual account plans. The regulations would be effective for plan years beginning on or after January 1, 2009. According to DOL, “The proposed regulation requires that uniform, basic disclosures be given to all participants and beneficiaries who direct the investment of assets in their individual accounts, and that investment-related information be presented in a format that makes comparisons easy.” The regulations would apply to all participant-directed plans. The DOL issued both a press release and fact sheet explaining the new proposed regulation.