Employers who have an injured worker are caught in a bind – especially if the injury occurred on the job. As the worker recovers, employers are faced with a decision.
Here are the options:
- Settle the workers’ comp claim and let the employee go,
- Continue to have the worker stay home, pending a full recovery, or
- Bring the worker on in a lighter-duty assignment unlikely to aggravate the injury.
Each, of course, has long-term consequences.
If you settle too many claims, your workers’ compensation premiums are likely to go up. This is because premiums are typically based on your claims experience in previous years. If things get too bad, you may have trouble finding affordable coverage from any carrier.
Similarly, letting the worker stay home, waiting until you can bring the individual back without restriction, has problems, too.
For one thing, you may be out some valuable experience. Secondly, your workers’ comp policy is still paying out lost wage benefits for as long as that worker stays home. And that runs up your premium costs just as surely as the “settle and terminate” approach.
The long-term consequences of not having the worker come back to the workforce, even in a reduced capacity, can also cause your workers’ compensation premiums to go up. And if the problem is severe enough, it could cause you to get dropped.
Some companies have faced the prospect of having to cease operations because their workers’ comp carriers dropped them, with no competitors willing to issue a policy, thanks to a track record of claims far outpacing premiums.
Return-to-work programs
Your workers’ compensation carrier is naturally eager to have you adopt a formal return-to-work program. The idea is that by bringing injured workers back to the workforce, with whatever modifications they need, the employer can realize at least some value. In the long run, your company pays either way – either in wages and benefits to an employee working at a reduced productivity level, or in future workers’ comp lost-wages claims.
Before you do so, though, count the costs.
You not only have wages to pay … you are also paying benefits and taxes on a less productive employee. This much, of course, is obvious. But what about the intangible effects of bringing the employee back? Is the worker disgruntled? Is he blaming management? Will he cause morale issues by complaining to fellow workers about incompetent or uncaring management when that’s simply not the case?
And how will workers perceive him? Will a worker placed on light duty in an air-conditioned office cause employees to think he’s “getting one over?” Could it inspire copycat claims from others hoping for the same cushy deal?
And, once you bring a worker back on light duty at full pay, what is the incentive to increase productivity? Have you removed the incentive to perform?
In this case, you have substantially reduced the risk to the insurance company of course – but only by taking more and more of the cost on yourself directly, which defeats the purpose of having insurance in the first place.
Aggravated Injuries
If a worker has one injury, they are at an elevated risk of a repeat injury or an aggravation of the pre-existing injury. This is one of the things that insurers look at when they look at your claims history and set premiums.
If you have a worker with, say, a moderate back injury, and you put her back to work, you run a very real risk that the worker will re-injure herself – possibly causing an even more expensive claim. In some cases, the injury will be legitimate. Sometimes, unfortunately, workers fake injuries to stay on light duty or to get to stay home and receive lost wage pay or disability.
Savings
The savings from a well-constructed return-to-work program are well documented. Most workers want to be productive, and employers are frequently resourceful in finding injured workers something of value they can do while they recover.
Furthermore, simply having a program in place – and a record of having made a reasonable offer of employment to an injured worker – can significantly strengthen the hand of the employer if the worker should take legal action. Judges will frequently disallow workers’ comp claims if the employee is on record as declining a reasonable work offer, taking their physical capabilities into account.
The takeaway
Return-to-work programs are valuable, but they’re not the best solution in every single case. They work best where the employer/employee relationship is strong, where you have generally well-motivated and honest employees who take pride in their work, and where you have adequate controls in place for reporting and documenting injuries right from the beginning.
It’s important to have a good return-to-work program on the books, documented in your employee manuals. But always treat each case on its own merits, taking into account the individual circumstances involved.