Worker’s Compensation

HR Glossary for HR Professionals

Glossary of the most common HR terms and acronyms to assist professionals navigating the ever-growing and ever-changing world of HR terminology.

Worker's Compensation

What is a Worker's Compensation?

Workers’ comp is a type of business insurance that provides benefits to employees who suffer job-related injuries or illnesses. Each state has certain laws and standards for workers’ compensation. These funds help workers pay for their missed wages, medical treatment, ongoing care, and disability leave. 

Who pays for worker’s compensation?

Worker’s compensation benefits are paid for by employers of the state. Worker’s comp systems vary state by state, employers usually pay for worker’s compensation in one of three ways: 

  1. Premiums to state-run insurance programs
  2. Payments to an insurance company
  3. Directly to employees

What are the requirements to receive worker’s compensation?

In general, in order to receive worker’s comp benefits employees must:

  1. Be an employee
  2. The employer must carry worker’s compensation insurance 
  3. Have a work-related injury or illness 
  4. Meet state deadlines and requirements for reporting and filing a worker’s comp claim

Who is exempt from worker’s compensation?

States often have exceptions for worker’s compensation including businesses with few workers, seasonal workers, temporary workers, agricultural workers, and independent contractors. Employers should check their state’s laws for exemptions. 

How to file worker’s compensation claim

While procedures vary by state, workers will need to: 

  1. Promptly report the injury or illness to their employer within a defined period of time 
  2. Usually the employer will give the worker necessary forms to fill out. In some states, there is a form through the state worker’s compensation agency.
  3. Once the forms are filled out, an investigation will be conducted to approve or deny the claim. 
  4. If the claim is approved, benefits will begin. If the claim is denied, workers can file an appeal.  

Worker’s compensation law by state

It is important to note that processes, deadlines, forms, and requirements vary from state to state. Contact your state’s worker’s compensation agency to confirm what worker’s compensation requirements you are subject to. 

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