Workers’ compensation is a mandatory insurance program that provides workers with compensation for the costs of medical treatment and lost wages if they sustain an injury at work or contract an occupational illness. If an employee suffers a fatal injury or illness, workers’ compensation provides death benefits for eligible surviving family members. Although workers’ compensation is nationally mandated, private insurance carriers and third-party administrators provide benefits to those with approved claims.
Employers purchase workers’ comp to provides benefits to employees who have suffered an injury or illness at the workplace. Pennsylvania’s Workers’ Compensation Act is the law that defines how claims are made, what benefits are available, and who is eligible to receive compensation. Under this Act, all private employers in Pennsylvania must purchase workers’ compensation insurance for their employees, whether the employees are full-time, part-time, or seasonal, even if the business is a non-profit corporation, is an unincorporated business, or has only one employee.
The Act contains just a few exceptions to this rule, including:
- Employees covered under other workers’ compensation-type programs, such as federal civilian employees, railroad workers, and longshoremen.
- Volunteer workers, provided they receive no compensation for their work, including monetary compensation as well as other forms of compensation such as products or services.
- Agricultural workers who work for less than 30 days or receive less than $1,200 from one employer per calendar year.
- Corporate executive officers.
- Employers who have filed for, and have obtained, an exception from workers’ compensation obligations due to religious beliefs.
Some of the benefits provided to injured employees through Pennsylvania workers’ compensation insurance include:
- Payment of lost wages, which may begin after seven calendar days of disability. If the worker still cannot return to work after 14 days, he or she will be retroactively paid for the first seven days. Lost wage benefits are approximately two-thirds of the wage the employee was earning before the injury occurred, up to the weekly maximum.
- Death benefits, provided to the family if the worker dies due to his or her injuries.
- Specific loss benefits, designed to recover the loss of certain body parts or the loss of function in those parts, including thumb, finger, hand, arm, toe, foot, leg; or the loss of hearing or vision as a result of the injury.
- Medical care, including reasonable surgical or medical services provided as a result of the injury, such as medicine, supplies, hospital treatment or services, orthopedic appliances, and prostheses.
Workers’ compensation insurance can be purchased by the employer from an insurer who is licensed to work in Pennsylvania or through the state-funded workers’ compensation insurance provider. Some companies may self-insure by providing proof of the ability to pay for the benefits that would be required if their employee became injured.