Ch. 17 - Workers' Compensation

finally

Even if negligent, before workers’ comp, employers could usually invoke

common law defenses

Elective benefits

allows employer or employee to pursue case outside of workers’ comp laws

Statutory benefits

fixed benefit remedies provided under the law

most states did this by the early 1900s

Compulsory laws

mandates the exclusive remedy for injuries was to be provided by the workers’ comp law

established absolute liability that required compensation for injured workers regardless of fault or negligence

Monopolistic states

coverage is only available through state plan

no agents selling workers’ comp plans

Who pays the premiums for workers’ comp?

employers

An employee includes:

full time, part time, seasonal, and temp workers

Who is not considered an employee?

independent contractors

Who is also exempt from workers’ comp in TX?

some farm and ranch workers - mostly casual day labor

casual labor

domestic employees (babysitters, housekeeping)

employees covered by federal workers’ comp

newly hired employee who rejects coverage within 5 days of hire

elective law

employer does not have to purchase workers’ comp, but employers lose some common law defenses

Texas is the only state that still has this.

Employer must also file notice with the (blank) if they choose not to carry workers’ comp

Division of Workforce Compensation (DWC)

Newly hired employees have the option to exempt themselves from workers’ comp within (blank) of hire

5 days

Doctrine of exclusive remedy

Employee cannot sue except in certain circumstances

3A states

states in which the employer has employees

listed in workers’ comp law section of contract - policy language refers to laws in effect for states listed on info page (3A)

Other states insurance

extends insured’s coverage for new or incidental operations in other states on an automatic and temporary basis

excludes monopolistic states

Employee who suffers an injury covered by workers’ comp is entitled to

all health care reasonably required for the injury

Workers’ comp benefits are based on the (blank) and continue as long as deemed necessary…

nature of the injury

continuation is unlimited or lifetime

Benefits are NOT paid for

pain and suffering, mental anguish, or cosmetic surgery solely for aesthetic reasons

Benefits are paid (blank) and replace a portion of average weekly wage for how long beforehand?

weekly

13 weeks prior

Disability income begins on what day after waiting period?

8th day after 1 week waiting period

Benefits are paid retroactively if the disability lasts more than…

2 weeks

If the death of an employee results from covered injury, insurance carrier will pay who and how much?

to the person who incurred the costs of burial

up to $10,000

Second (Subsequent) Injury Fund

when employee with previous injury or disability suffers another injury that causes disability to be more serious than if there had been no prior disability

funded by unclaimed death benefits in TX, paid for maximum of 364 weeks (7 years)

Vocational rehabilitation

provided by TWC - Workforce Vocational Rehabilitation Services

if they determine someone can return to work or receive training

Insurance carrier must pay benefits no latter than (blank) after they receive written notice of injury

15 days

BI and occupational disease that arise….is covered under Workers’ Comp

arise out of or during employment

Workers’ comp do not cover these diseases:

ordinary diseases - ex. stroke, diabetes, flu, covid

Workers’ comp usually doesn’t cover these injuries:

• occurred to and from work

• caused by Act of God (weather) - unless job puts employee at harms way due to weather

• caused by intoxication

• willfully caused injuries

• caused by willful failure to follow safety precautions

• occur from activities not part of the job (volunteer games, etc.)

• injuries caused by 3rd parties (terrorism, shooting, spouse)

Employee must notify employer no later than

30 days after injury has occured

Claim must be filed within

1 year from injury date

Legal beneficiary has how long to file a death claim?

1 year from injury date

Employer must report the injury to insurer within

8 days of being notified

Workers’ comp rating is determined by a rating bureau (blank) to how much of payroll?

job classification rate

each $100 of payroll

Estimated payroll figures are used when policy is issued and final premium is determined by an

audit

Experience modification factor

developed by rating bureau - relates employer’s losses, payroll, and premiums

Premium discount applies when insured owes a total…

standard premium greater than $5000

Experience rating

based on frequency of claims

way to punish unsafe employers and reward safe ones - encourage employers to create safe workplaces

Modifiers: 1 = neutral, .90 = rewards, 1.10 = punishes

Most common types of situations covered under Employer’s Liability

• exempt employments

• illegal employment

• suits brought by family for loss of consortium

• gross negligence

“Exclusive remedy” doctrine

employees barred from seeking damages outside of workers’ comp

Employer’s liability coverage

for claims not covered under workers’ comp