Workers’ Compensation – An Overview

Employees in the U.S. rely on workers’ compensation when they’re injured on the job. Workers’ compensation benefits are commonly awarded for work-related injury, illness and death that occur at or as a result of work. Workers’ compensation may cover medical expenses, lost wages and benefits to survivors.

History and Origin of Workers’ Comp Law

The idea of workers’ compensation has its origins in Germany in the early 1800s. The industrial revolution saw dangerous new workplaces such as railroads, factories and mines with accompanying increases in injuries, deaths and new work-related diseases. Social and political sympathy for the common worker grew and led to the enactment of early workers’ compensation legislation.

The concept soon spread to other European nations, ultimately resulting in an 1897 British law that was the impetus for the first US workers’ compensation laws. Almost all US states had some type of workers’ compensation system by the 1920s. The federal government followed suit for most federal employees and for certain industries.

Prior to the establishment of workers’ compensation, English and American laws were inadequate to protect workers harmed in increasingly hazardous industrial jobs. Ordinary employees rarely had the financial means to bring negligence lawsuits against their employers. When they did, employers usually relied on one of three defenses, dubbed the “unholy trinity,” to defeat the claims: that another employee was actually responsible, that the injured worker had contributed negligently to the accident or that the employee had assumed the risk of injury by accepting the job.

Theory and Policy Behind Workers’ Comp

The workers’ compensation system is set up so that if an employee receives benefits through it for a particular injury or disease, he or she cannot sue the employer for the same injury or disease. The employee receives benefits in a timely manner. The employer accepts responsibility of paying out workers’ compensation claims, even if not at fault for the accident, illness or death. The employer no longer has to worry about the potential of devastating lawsuits or being tied up in court.

States require that employers who are responsible for workers’ compensation must have the means to pay out claims. They may set aside sufficient resources to cover claims (i.e., self insure), carry workers’ compensation insurance or contribute to state-run workers’ compensation award funds. How an employer may pay for workers’ compensation varies by state.

The social and economic policy behind workers’ compensation is that these employer “costs” are ultimately paid by society as a whole in the form of higher prices for goods and services. Some theorize that the cost of the program is actually covered by lower wages, but that the trade-off to workers is well worth it. Workers’ compensation is also seen as an incentive to employers to develop safer workplaces.

Exceptions to Workers’ Compensation

Most states do allow lawsuits to be brought against an employer in extreme situations. When employers act in bad faith or intentionally or criminally harm employees, an employee may be able to sue the employer. A lawsuit against a third party may also be possible, such as against a manufacturer of faulty equipment that causes an injury. In such circumstances, the employer may be able to get reimbursement for workers’ compensation benefits already paid.

Need Help With Your Worker’s Comp Case?

Attorneys Johnnie Fulton and Andrew C. Barr are experienced workers’ compensation attorneys in Greenville, SC, serving the upstate South Carolina area. If you have a question about workers’ compensation law, call 800-868-2110 or contact us online to set up your free consultation.