It doesn’t matter whether you’re a startup or established business—dealing with workers’ compensation is always stressful. If not handled properly, it can deal a blow to your company’s finances and your relationship with employees.
A workers’ compensation injury is an injury that occurs in the workplace in which the employer is legally obligated to pay for the employee’s medical costs and time-out-of-work due to the injury. Here’s how you can properly calculate workers’ compensation if an injury happens at your workplace, with some other tips on how to deal with such an event.
What’s Considered a Workers’ Comp Injury?
A workers’ comp injury is an injury that occurs at your workplace. Typically, the injury is caused by work activities, materials, and equipment. It may also be an illness that employee develops due to their work activities.
Workers’ comp usually doesn’t cover:
- Stress or psychiatric disorders
- Self-inflicted injuries
- Injuries caused by fighting or rough-housing
- Injuries that occur during commutes
- Injuries that occur while the employee is committing a crime or violating company policies
When an injury occurs in the workplace, an employee usually has to notify you and file a written statement, and then they’ve got to file a workers’ comp claim. The employee may only have a limited amount of time to file the claim, depending on the state.
Not all workers’ comp claims are accepted—sometimes they might be rejected by the insurance company because the injury wasn’t covered under their policy. Additionally, a workers’ comp claim can also be falsified by an employee. That’s why it’s important to have top-of-the-line security cameras in your workplace, as video footage could possibly refute false claims. Think about installing cameras in your business, whether its retail or an office environment.
What are Workers’ Comp Benefits?
When a workers’ comp claim is accepted by the insurance company, then you—as the employer—are legally required to pay for all your employee’s medical expenses pertaining to that injury. These might include hospital charges, physical therapy, ambulance services, and even surgeries. If you fail to pay these expenses, then you might face legal trouble.
It can be incredibly difficult to figure out exactly how much you owe, and there’s a possibility that an injured employee could claim some medical expenses that aren’t actually related to their workplace injury—which is fraudulent but which could cost you a lot of money if you don’t verify the expenses. Consider looking into workers’ comp bill review services. This type of service will do a lot of the hard work for you, mainly by tracking the injured employee’s expenses and verifying them to make sure they’re workers’ comp-related. Medical expenses can be very taxing on a small business so you never want to pay more than you have to.
How Workers’ Comp Claims are Filed
When an employee files a workers’ comp claim, there are usually three steps in the process:
- First, the employee notifies you (the employer) about the injury
- Second, the employee files a workers’ comp claim with your company
- Third, the employee files a workers’ comp claim with the proper jurisdiction (varies from state to state)
An employee will probably not be able to earn workers’ compensation unless all three steps are adhered to. The three steps are intended to protect both you and your employee from fraudulent claims/dismissals about the injury.
Know the Statutes of Limitations for Your State
Each state has its own statutes of limitations that places guidelines and restrictions on workers’ comp claims. Most importantly, these statutes dictate how long an employee has to file a claim. You can view the statutes of limitations by state here.
Although some states may allow 1 to 2 years to file a claim, it’s generally better that workers’ comp is handled soon after the injury occurs. This is so all injury claims can be investigated and verified, and so you can properly keep track of an injured employee’s medical treatments.
Workers’ Comp Insurance
It’s important that you purchase workers’ comp insurance for your business, whether you’re a retail environment or an office. Medical costs can be exorbitantly high, so it’s better to pay a smaller monthly stipend rather than facing huge expenses for surgery or doctor’s visits. Workers’ comp insurance is especially necessary for a startup company, because high medical expenses could quickly put a small company out of business.
Now you know a little bit about workers’ comp! If you’re a business owner, be sure to commit this information to memory. And, if you haven’t yet, purchase workers’ comp insurance so you can protect your finances and keep your employees happy.