Should Employers Refute All Workers’ Compensation Claims? | DCR Workforce Blog

Should Employers Refute All Workers’ Compensation Claims?

worker compensationTennessee planned to pass legislation which makes it possible for ‘low risk’ companies to opt out of state-mandated workers’ compensation coverage. The legislation would allow private-sector employers to create their own policies and self-funded injury benefit programs, replacing the coverage offered under state law. However, the Advisory Council on Workers’ Compensation has unanimously voted against the “Tennessee Option” bill, choosing to wait for an assessment of the outcomes of similar moves in Texas and Oklahoma. On the other hand, we have employers, Walmart, Nordstrom and Safeway and others, lobbying hard to make sure that workers who are injured on the job cannot access wages and medical care, in the form of workers’ compensation across multiple states.

It is natural for employers to seek ways to save money, especially when they feel that their business is at low risk for workers compensation claims. Others believe that an opt-out option will require the states to create a new branch of government that will establish standards and provide oversight and investigation, and with that comes increased costs to taxpayers. Sceptics also fear that employers and insurers together will refute valid claims, forcing the injured worker to pursue lengthy and expensive litigation as the only means of receiving justified benefits.

Given a choice to opt-out from state-mandated coverage, can we expect employers to change their benefits plans to the detriment of the interests of the workers? Will there be an increase in the number of claims that are disqualified based on the terms of the ‘customized’ plans? It is difficult to say. Employers point to the numerous highly publicized cases in which workers were granted claims, and then found to be running marathons, playing golf, or engaging in strenuous “under the table” work.
So, the questions one has to ask are probably these: Is the existing workers compensation program broken? Can it be improved, or do we want to do away with workers’ compensation? Could a blended program in which “low risk” companies replace State-administrated workers compensation with their own plans improve the situation, or make it worse? Ultimately, who is responsible for supporting those who were injured in the course of their duties for an employer?

Whatever the outcome, any changes to the existing structure will take time. What should employers do today to prevent Workers’ Compensation Benefits from becoming a drain on their profitability? DCR encourages all companies to adopt some of the following measures:

  • Act proactively to prevent the possibility of injuries at their workplace and instill a culture of safety in all workers. Encourage and recognize workers who make constructive suggestions for improving the overall safety of the workplace.
  • Regularly inspect each workplace for avoidable hazards. Protect workers from toxic chemicals, loose and falling tools, moving parts and the speficic hazards associated with seasonal changes (heat stroke, frost bite, falling on icy surfaces, and more). Invest in safety training. All workers – permanent and temporary – should participate in a safety training session prior to start of work. The training should be customized for each work site.
  • Control the atmosphere at the work place. Correct any ‘at risk’ behaviors among the workers.
  • Learn about the possible injuries common to similar workplaces and take preventive measures by providing the workers with safety equipment. Train workers on the proper use of that equipment. Institute a reporting mechanism and action plan (like first aid, trip to a medical facility, reporting to other stakeholders, avoiding a repetition and controlling the severity of the injury) which needs to be followed in case of injury to any worker.
  • Establish evacuation plans, and appoint individuals in every facility responsible for orchestrating an evacuation and accounting for all workers. Conduct periodic evacuation drills.

Analyze the causes of any incidents which threaten the safety of the workplace and eliminate the possibility by instituting corrective measures.

  • Offer modified working conditions to an injured worker, instead of their regular duties.

The most effective way to control workers compensation costs is to reduce the number of claims. Following the steps suggested above make it possible for a company to manage costs while also increasing operational efficiency and worker satisfaction. If you are a staffing agency whose worker is asked to report to a client’s workplace, you and the client who has retained your services are jointly liable for the safety of the worker. Do make sure that:

  • Your contract clearly lays out the safety responsibilities of your clients and your worker.
  • If you specialize in staffing skills required in “high risk” work environments, employ a safety expert. Conduct onsite inspections of client facilities prior to bidding on jobs. Periodically re-evaluate work sites.
  • Use the information gained from the onsite inspection to develop site-specific worker safety plans and mandatory orientation programs.
  • Your clients will have to attest to their commitment to ensuring the safety of your workers on site.
  • Establish a process for your workers to inform you of any safety hazards or incidents.
  • Ensure that there is an individual designated to evacuate and account for all temporary workers in case of a disaster.
  • Have a reporting mechanism in place for all injuries and illnesses, big and small, making it possible to answer any inquiry or investigation with the necessary details.

For any employer, managing an injury claim starts with preventing injuries that result in claims, avoiding unjust claims, and minimizing administrative costs fighting valid claims.

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.