Workers’ compensation laws provide medical and wage benefits to help workers recover from job-related injuries or illnesses. State laws, the injury suffered and the type of job determine how much workers receive for lost wages.
This guide outlines the general rules for workers’ comp wage payments, potential exclusions and types of pay benefits.
General Rules for Workers’ Compensation Wage Payments
States set their workers’ comp laws, meaning they set their own exclusions and payment processes. However, the amount workers are paid for lost wages is generally consistent across the country.
In most cases, workers receive two-thirds of their regular wages for missed work, up to a state-set weekly maximum. For example, if you normally earn $1,800 a week, you would receive $1,200 per week for the time you missed working while recovering from your injury.
In this example, though, your state’s weekly maximum could prevent you from receiving the full $1,200. Here are some state-specific examples illustrating how a benefit cap could impact how much you receive:
- Indiana’s maximum weekly benefit is currently $828, which is the most you’d receive even if you made $1,800 a week.
- Massachusetts’s maximum weekly benefit is currently $1,829.13, meaning you’d receive the full $1,200 weekly.
Caps also vary widely by state. Iowa has the highest weekly maximum benefit at $2,274, and Mississippi has the lowest at $608.
There are also circumstances in which you may be able to receive more than the maximums, such as in the event of multiple injuries or injuries that result in permanent disability.
Hiring a workers’ compensation attorney can help you get the full compensation you deserve to cover your time off of work and any medical expenses.
Exceptions to General Rules for Workers’ Comp
While most states use the two-thirds rule to calculate workers’ compensation payments, this model is not absolute in all states.
For example, Texas pays temporary income benefits at 70% of the difference between a worker’s average weekly wage and postinjury earnings, or 75% if the worker’s hourly rate is below $10. On the lower end, New Hampshire covers only 60% of a worker’s preinjury average weekly wage.
Some states, such as New Hampshire, require employees to miss three work days before qualifying for workers’ compensation benefits. Workers may use accrued sick or personal leave during this time, but workers’ compensation will not cover those lost wages.
However, other states will retroactively pay for these three days if a doctor confirms the employee cannot return for at least 14 days.
Employees Excluded From Workers’ Comp
Since each state sets its own regulations, the employees who do not qualify for workers’ compensation benefits vary. If your job type does not meet eligibility requirements, you cannot collect workers’ compensation for lost wages.
Some states, such as New Jersey, require employers to provide workers’ compensation coverage for all employees or obtain approval for self-insurance. In these states, workers do not need to worry about eligibility.
In other states, certain workers are often excluded from lost wage benefits, including:
- agricultural workers
- maritime workers
- railroad employees
- independent contractors
- volunteer workers and unpaid interns
- sole proprietors
- real estate agents
- federal government employees
Some of these workers may not qualify for workers’ compensation because they receive coverage under other state disability or employers’ liability laws. If you are unsure whether you qualify, consult your state’s workers’ compensation board.
Temporary vs. Permanent Disability Payments
Payments for workers’ compensation benefits vary based on the severity of the injury and the length of recovery. The main types of workers’ compensation benefits are listed below.
- Temporary total disability (TTD) benefits compensate workers when a work-related injury or illness temporarily prevents them from returning to their preinjury job or another suitable position with the same employer.
- Temporary partial disability (TPD) benefits compensate workers who return to work in a reduced capacity after an injury.
- Permanent total disability (PTD) benefits compensate workers who cannot work at all because of a work-related injury or illness.
- Permanent partial disability (PPD) benefits compensate workers who have permanent physical impairments but can still perform some work.
Many states also provide workers’ compensation death benefits to support an employee’s family if a work-related injury or illness results in death. These benefits may include payments and coverage for medical bills, funeral costs and burial expenses. However, states impose caps on the total amount a family can receive.
Determining your eligibility for benefits usually involves discussions with your employer and a workers’ compensation claims adjuster. You may also consult a workers’ compensation attorney—often at no cost—to ensure you receive fair compensation or to develop a plan for securing it.
Frequently Asked Questions (FAQs) About Workers’ Compensation
How are workers’ compensation benefits paid?
Like many other rules governing these benefits, workers’ compensation payment methods vary by state. Most states issue payments every two weeks but may also allow workers to request a lump sum.
Lump sum payments may not follow the same rules as weekly benefits in that state. Many states also let workers seek additional compensation after accepting a lump sum. This provision helps cover unforeseen expenses not accounted for in the initial settlement.
How long do workers’ comp lost wage benefits last?
The length of time workers’ comp lost wage benefits last depends on various factors, including the severity of the injury, recovery time and the laws of your state.
Generally, benefits paid weekly or biweekly end once the employee can return to their full work schedule without any limitations. However, if you opt to receive your benefits as a lump sum, that is the “end” to receiving them, as your compensation is paid out all at once.
For employees receiving temporary disability benefits, a state may limit the length of time an employee collects, usually between three and seven years.
For employees who receive permanent disability payments, these may end once the employee turns 65 and can collect Medicare and Social Security benefits.
What if an at-work injury makes it impossible to do my job again?
If your injury prevents you from returning to your former position, you may have options beyond workers’ compensation. Some state workers’ comp benefits have a maximum duration, and as you near that limit, you can request to make your benefits permanent.
However, you typically qualify for permanent benefits only if your injury prevents you from working in any capacity. If that applies to you, you may also be eligible for other benefits, such as long-term disability insurance or Social Security Disability Insurance (SSDI) payments.
When should I consider hiring a workers’ compensation lawyer?
You should consider consulting a workers’ compensation attorney if:
- Your claim is denied.
- The doctor you see declares you fit for work before you’re ready.
- Your employer or insurer tells you that you cannot file a claim.
- Someone accuses you of fraud or attempting to cheat the system.
- You feel uncertain about how to navigate the claims process.
You have the right to consult an attorney at any stage of the process, so if you believe you are entitled to benefits, do not let anyone pressure or discourage you from seeking legal counsel.
