- Workers’ Compensation is documented as far back as 2050 B.C., found in Sumerian (now Iraq) tablets. Workers were provided monetary compensation for specific injury to workers’ body parts, including fractures.
- Prussian Chancellor Otto von Bismarck spearheaded Workers’ Accident Insurance in 1884, creating the first modern system of workers’ compensation.
- The various workers’ compensation statutes in America are all modeled loosely after the original Prussian system.
- “No Fault” means that neither employees’ negligence nor employers’ lack of fault in an injury-causing accident is of consideration in determining benefits.
- Return-to-work programs are essential to reducing lost wages, claims, and ultimately premiums. Return-to-work programs are also directly correlated to productivity benefits. Lexis Nexis reports that “on average, individuals receiving disability benefits are paid between 50% and 70% of their normal wage. By bringing employees back to work at 100% pay, the company is only paying 50% to 30% more while benefitting from 40 productive hours each workweek.”
- Most states require business to carry workers’ compensation Insurance, but not all. For example:
- Texas does not require coverage, leaving it up to employees to open lawsuits against those employers who choose not to carry the insurance.
- New Mexico requires coverage for companies with three and more employees, which includes the owner of the business if the owner works in the business, family members, part-time, temporary, and seasonal workers. Construction companies of any size are required to insure their workers and this applies to out-of-state construction workers working in NM.
- Arizona requires coverage for one or more employees, regardless of whether they are part-time, full-time, minors, aliens, or family members.
- There are exceptions to workers’ compensation laws. For example:
- In New Mexico, coverage is not required for domestic servants or for real estate salespeople. Coverage is not required for federal employees covered by the Federal Employees’ Compensation Act or other federal programs. Also, executive employees or sole proprietors with a financial interest who are employed by the professional or business corporation or limited liability company can elect not to be insured.
- In Arizona, a sole proprietor with no employees is not required to maintain workers’ compensation insurance on himself/herself, and generally, businesses do not have to provide coverage for independent contractors.
- Workers’ compensation benefits are payable only for work-related injuries. Benefits are not available for self-inflicted injuries or for injuries that occur when the employee is intoxicated or influenced by substance abuse.
- Coverage includes pre-existing conditions worsened by work; occupational diseases, such as black lung, and chemical exposure; hearing loss; and scars.
- Following OSHA Laws and Regulations will reduce injury and premium rates.
Register for Our Webinar: Demystifying Workers’ Comp
The words “workers’ compensation” are enough to make many employers want to run the other way. From employer obligations to the claim process itself, workers’ compensation can feel overwhelming. Join us for our webinar as we demystify workers’ compensation and give you the tools to become comfortable handling claims and developing a return-to-work program. (Thursday, January 18 @ 11 am MST).
Still Need Help Navigating Your Workers’ Comp Claims?
If you’re still mystified, contact our Human Resource Consultants for help navigating the difficult waters of Workers’ Compensation. We can sort out your claims, help you put a return-to-work program in place, and help you comply with the OSHA regulations that affect your business.