Workers’ Comp 101 – What Employers Need to Know
If you are an employer, chances are that you are very familiar with what is known as the workers’ compensation system here in Georgia as well as the rest of the United States. However, if you are a start-up business or an established business that has never incurred a workers’ comp claim, you may not really understand much about this state-mandated program – except when it’s time to pay the insurance premiums.
Worker injuries can happen in any business, not just heavy industry. Therefore, it is important that any business owner or employer educate themselves on the workers’ comp system in Georgia and wherever you do business. Today, we are interviewing a legal expert on the subject of workers’ compensation laws and a simple lesson on what employers should know – no matter what type of business or operation that they are running.
Chuck DuBose is a partner with Stewart, Melvin & Frost – an uncommon practice and one of the region’s oldest and largest law firms. Chuck specializes in workers’ compensation law, representing employers, insurers and third-party administrators.
Question: Can you tell us how long Georgia’s workers’ comp system has been in existence and why it was started?
Chuck: The workers’ compensation system was created in the early 1900s in Georgia and across the United States.
The impetus behind its creation came from both the employee and the employer. The employee was looking for compensation for work-related injuries. The employer, on the other hand, was interested in protection from liability and their business interests.
Therefore, the workers’ compensation system was started as a compromise between these two interests.
Today, employees who are injured or killed on the job receive compensation from workers’ comp insurance that is paid by the employer. In turn, regardless of fault, the injured employee or their family gives up the right to file a lawsuit against the company.
Today, the program is operated at the state level. Therefore, the workers’ comp laws vary slightly from state to state. In Georgia, our workers’ comp system is administered by the State Board of Workers Compensation.
In most states, like Georgia, businesses are required to participate in the workers’ comp system, while a few states allow businesses to opt out in exchange for giving up some legal protection.
Question: What does workers’ comp cover?
Chuck: Workers’ compensation insurance covers any injury or illness that is work-related. The injury can occur directly from an accident such as a fall or an equipment malfunction. Or it may happen over time, such as repetitive stress disorders, exposure to harmful workplace chemicals, or back problems from heavy lifting.
Workers’ comp provides a percentage of replacement income for employees while they recover from their injuries. It also provides medical treatment and physical therapy related to the workplace injury. And in the event of death, workers’ comp provides survivor benefits to the employee’s dependents.
Question: What does workers’ compensation insurance not cover?
Chuck: Workers’ comp does not cover injuries that can’t be directly attributed to the employer – such as an accident that is related to alcohol or drugs; an accident due to horseplay or a fight that the injured employee started; or any accident that has no relation to the employee’s job or workplace.
Question: What are a few tips that employers need to know about workers’ comp?
Chuck: First and foremost, workers’ compensation insurance – whether through a private insurance firm or a self-insured program – is mandatory under Georgia law for any business with three or more employees.
Some businesses – for example, a professional consulting firm in an office environment – may not seem to present much of a health risk to their employees. But it is a mistake to think that workers compensation insurance is primarily there to protect blue-collar workers operating heavy equipment.
The risk of a work-related injury occurs in any business. In fact, some of the most common injury claims involve someone tripping or slipping on the job as well as lifting injuries.
A job-related injury can also occur outside the office – such as a car accident while running a work-related errand. As long as it’s “on the clock” and related to work, the injury is covered.
Employers also need to understand that if they don’t carry workers’ comp insurance, they are losing legal protection and opening themselves up to a lawsuit related to a workplace injury or death. In addition, there can be fines levied by the state for failure to carry workers’ compensation insurance.
Finally, all employees must be covered by workers’ comp insurance. But there are certain classifications of employees that are excluded such as business owners, independent contractors, farm laborers, and domestic servants. Railroad workers, for example, are covered under federal law not state workers’ comp laws.