Examining Workers' Compensation

The history of Workers' Compensation dates back literally thousands of years, to the beginning of written history. Workers' Compensation regulation and laws appear today in virtually all industrialized nations although laws governing workers have changed dramatically throughout history, and the United States is certainly no exception.

The concept of Workers' Compensation can be found even in antiquity. The peoples of ancient Greece and Rome had very specific rules and regulations that outlined how people should be compensated due to injuries suffered in the course of their employment. While many people today seem to think our sets of laws and regulations are mind-numbingly precise and detailed, it should be noted that even ancient peoples had very precise schedules that governed the levels of compensation for each worker. For example, in ancient Arab law, the loss of a thumb was worth exactly one-half the value of an entire finger.

As detailed as the ancient Workers' Compensation laws might have been, the difference between an impairment and a disability, a very important distinction in today's labor force, had not yet arisen.Briefly, an impairment is the loss of the use of a specific body part, or multiple body parts. A disability is the inability to perform one's job or assigned tasks. Although specific rules existed in ancient times for the compensation of impairments, the notion of a disability would take many years to become a part of the Workers' Compensation series of laws.

As time progressed toward the Middle Ages and feudalism became the prevailing form of government, the specificity of the ancient laws governing Workers' Compensation were replaced with a more localized system. In the Middle Ages, the fate of workers was left chiefly to the feudal lords who were to care for their workers. Each of them made up their own guidelines for the compensation of workers who suffered an injury while under their employment. Naturally, some lords were more benevolent than others and the uniformity of the ancient laws governing Workers' Compensation gave way to a more localized, and chaotic, set of rules in the Middle Ages. It was not until the Renaissance period, roughly beginning in the 14th century, that labor laws were updated to include more uniform Workers' Compensation regulations.

Beginning in the Renaissance period, and leading up to the Industrial Revolution, or approximately the late 18th century, there were three main principles that governed compensation for injured workers. These were contributory negligence, the "fellow servant rule," and the assumption of risk.

Contributory negligence meant that if a worker contributed to his or her own injury, due to careless use of a machine, for example, the employer was not responsible for the injury. This principle was intact even if the working conditions were less than satisfactory or if the worker was using particularly dangerous machinery. Similarly, if a worker was responsible for the upkeep of any machinery and responsible for maintaining its safe use, any injury due to a malfunction of such machinery could not be blamed on an employer.

The "fellow servant" rule was put in place to state that an employer was not to be held liable if an injury to a worker was due to a colleague, or a fellow worker.

The assumption of risk concept was simply that certain workers knew the inherent dangers of certain jobs. It stated that when workers signed their contracts to be employed by an employer, they released the employer from any liability resulting from an injury on the job. Employers were required to provide safety measures but, until modern times, these measures were usually wholly inadequate.

These three principles, when looked at through the context of modern history, seem extremely unfair and, indeed, they were regarded as unfair by many employees during the time periods in which they were enforced. The only recourse a worker had during these times was litigation. In those times, as well as in today's society, legal matters were extremely costly. Additionally, it was extremely difficult for a worker to win any compensation at all. Professional workers, and those with higher levels of education and money, were able to buy a primitive form of disability insurance. As more and more workers became accustomed to bringing lawsuits against their employers, many employers began to criticize the current state of laws and joined the workers in calling for reforms.

A major change in Workers' Compensation laws began in Prussia in 1871 with the passage of the Employers' Liability Law, which provided some protection to workers in certain sectors of employment. These sectors included such venues as factories and mines. The law was the initiative of Prussian Chancellor Otto von Bismarck. In future years, Bismarck also instituted such initiatives as the Workers' Accident Insurance of 1884 which is generally regarded as the first doctrine of modern day Workers' Compensation. Additionally, he started a pension system for workers who were injured in non-job related incidents. It provided a small pension for those unable to work due to an injury as well as those who were never able to work due to certain disabilities. A very important concept of these laws was the protection employers enjoyed from worker lawsuits. The state run laws provided the only recourse for workers who were injured and, in many instances, lawsuits became unnecessary.

As time progressed, countries in the West began to embrace the notion of Workers' Compensation and enacted laws that protected, in essence, both the worker and the employer. The initiative of Otto von Bismarck served as a model for these laws. In 1880, there were laws enacted in England to establish workers' rights, but they were generally regarded as inadequate. It was not until 1897 when the British Parliament passed the Workers' Compensation Act, which provided stringent laws governing workers' rights. It established the right of private companies to provide insurance for workers, unlike the Prussian model which was entirely run by the government.

Workers' Compensation laws in the United States were not enacted until 1906 and 1908, when a series of laws known as the Employers' Liability Acts were passed. They replaced the contributory negligence concepts of earlier times with regulations that provided a higher level of protection for workers. But, each state was left to decide how to interpret the laws. Each state passed their own version of comprehensive Workers' Compensation laws beginning in 1911. Mississippi was the last state to pass such laws in 1948.

The Social Security Disability Insurance, or SSDI, was the first federal program that provided workers with compensation due to injuries sustained in non-job-related incidents. Like the pension model in Prussia, it also provided for benefits for people who were never able to work due to a disability.

The history of Workers' Compensation laws shows great improvement over the years, but they are constantly being evaluated and changed as our labor force changes. We will take a close look at our current series of laws to examine how workers are protected in today's marketplace.
Workers' Compensation Benefits
Workers' Compensation regulations and laws vary from state to state, but virtually all states have similar types of benefits. Depending on the severity of your injury, and several other factors, you may be entitled to a wide range of benefits. This chapter will address each type of benefit in detail, explain how to obtain these benefits, and, if applicable, what rules and regulations must be met to qualify.

Payments for Lost Wages

The most commonly requested and most commonly earned Workers' Compensation benefit is payment for lost wages. If you become temporarily unable to work due to an injury, most states provide for 2/3 of your gross earnings to be paid to you while you are unable to work. This payment will come from your employer's Workers' Compensation insurance company, and they will not be taxed. Since the benefit is untaxed, many people will earn close to (but not fully) their regular income. For more information on financial hardship, or taxes and obligations of Workers' Compensation benefits, see the chapter on financial considerations.

Interested in learning more? Why not take an online Workers' Compensation course?

Specific Loss Benefits

In the event that you are very seriously injured and have lost of the use of a limb, Workers' Compensation insurance provides financial compensation based on a particular schedule, depending on the limb or impairment. These payments are established by the employer's insurance company, not by the state. The payment amount will also depend on how much of the body part has been lost. If you lose half of a body part, you receive half the amount of the claim. There must be evidence of bone loss in order to receive partial payment. The amount of the payment will also depend on the number of weeks you were unable to work due to the injury.

Death Benefits

State laws vary greatly concerning death benefits to the family of a deceased worker. For example, in some states, Workers' Compensation insurance will pay up to 400 weeks of Workers' Compensation benefits while others will pay a lump sum amount. In addition, if the deceased worker has minor children or a disabled spouse, the family may be entitled to additional Workers' Compensation benefits. Spouses will receive these benefits for as long as they remain dependent and do not remarry, and, in many cases, they become eligible for yearly cost of living increases.

Medical Care

You are entitled to comprehensive medical care and treatment if you have sustained an injury in the workplace. Your employer's Workers' Compensation insurance will pay 100% of the cost of all treatments necessary that are a direct result of a workplace injury. Naturally, it is of paramount importance for you to get the care you need to prevent any additional or permanent damage.s. Even if your claim is denied, you still have recourses available to you.

Medical Devices and Adaptive Equipment

In addition to comprehensive medical care and treatment, you will be entitled to any adaptive or special devices that you will require as a result of an injury. The costs of these devices and any training on how to use them are fully covered by Workers' Compensation benefits insurance.

Vocational Rehabilitation and Job Training

In additional to medical care, an injured worker may be entitled to training if it has been determined that he or she will need to perform a different job, or perform differently at their current job. There may be some special considerations that an employer will have to abide by to accommodate injured workers.

Physical Therapy

Similar to job training and vocational rehabilitation, physical therapy is offered to injured workers to help them regain full mobility. Workers' Compensation insurance provides for as much physical therapy deemed necessary by a qualified medical professional. You should consult with your doctor regularly on any progress you are making and he or she will make the determination if you need to continue in your therapy or if you need it at all.

Permanent Partial Disability

Permanent partial disability, usually referred to as PPD, benefits are available to an injured worker if it has been proved that he or she is permanently partially disabled and unable to perform at their normal, peak capacity for the rest of their life. Unlike total disability, partial disability is prorated based on a variety of factors. The most important factor is the amount of loss of mobility or of a body limb. For example, if 10% of one's arm is lost, 10% of the payment for a full arm loss will be paid for a specific period of time. In some instances, this period of time is for a person's entire life. Regulations for PPD vary widely from state to state and among insurance companies. If you have employed an attorney (and you are strongly encouraged to do so if you have a permanent injury), your attorney will discuss this at length with you and provide specific state information.


Permanent Total Disability

Permanent total disability, usually referred to as PTD, benefits are paid to an injured worker who has proved that he or she can never return to gainful employment as a result of their injury. In many instances, these benefits are paid for the rest of the worker's life, but it is important to note that these benefits may become reduced if the worker begins to collect any compensation from Social Security or from the government. The next section addresses Social Security Benefits.

Social Security Benefits for Permanently Disabled (SSDI) and
Social Security Income (SSI)

Social Security Disability Benefits (SSDI) are available to workers who have been permanently disabled and who have earned enough work credits in the years preceding their injury. Usually, a worker will qualify if they have worked five of the last ten years preceding their injury. The following situations determine if you are eligible for SSDI benefits:

· If you have earned enough work credits preceding your injury.

· If you have an impairment that will last at least 12 months or will result in death.

· The extent of your injuries.

· The ability to engage in gainful employment.

Family members of an injured worker may also be entitled to SSDI benefits, based on the injured worker's earnings. There is a specific schedule of benefits that the Social Security Administration publishes each year.

Social Security Income benefits (SSI) are provided to low-income children and adults who have become disabled. The Social Security Administration considers all sources of income when determining the eligibility of SSI benefits, including assets such as savings accounts and the income of other household members. The following situations determine if you are eligible for SSI benefits:

· If your household income meets the income requirements set forth by the Social Security Administration

· If you have an impairment that will last at least 12 months or will result in death.

· The date your disability began.

· One's ability to engage in full time employment.

· One's total net worth.

The application process for SSDI and SSI benefits usually takes place at a local office of the Social Security Administration. The application form is complex, and the application form may be reviewed for at least several months before a decision is made. It is common for the Administration to deny benefits, but you may appeal this decision, and you are encouraged to consult with your attorney during the application process.