Despite all the existing safety measures and guidelines at work, employees can still suffer from injuries or illnesses due to work-related reasons.
In 2020 alone, there were more than 1,176,340 nonfatal work injuries related to falls, slips, and trips, 18% resulting in days and weeks out of work. Suffering from traumatic work-related injuries can greatly affect your ability to perform your job-related duties and earn wages.
That said, several companies and employers adopted workers’ compensation programs to help employees recover from their work-related illnesses or injuries.
In this article, we’ll discuss the answer to your question, “How much does workers comp pay for lost wages?” and the factors considered when calculating the benefit amount.
When Do You Receive Lost Wage Benefits
You may qualify for lost wage benefits if you are unable to work due to a partial or total disability for a week. Aside from this, other types of workers comp benefits are also provided, such as medical care and vocational rehabilitation. Here are the things you should keep in mind when applying for lost wage benefits:
- Unless the disability extends beyond fourteen days, lost wage payments are not given for the first seven days
- If you are still unable to work after 2 weeks due to the injury, you may qualify to receive lost wage compensation
- If your employer’s insurer approves, benefits and payments should be given within 18 days of submitting your claim. Alternatively, you may also be given lost wage compensation within 10 days after informing your employer of your injury or illness
- Claims that get rejected usually end up in court trials, where a judge reviews the case and imparts a decision. You are still eligible to receive medical coverage and disability benefits until a decision is given. However, if your claim is approved in court, your lost wage benefits will be deducted based on the number of disability benefits you already received while your case is being heard
Factors To Consider When Calculating Lost Wages
Most insurance companies issue lost wage benefits every two weeks. At the same time, you must submit a medical status update form for every lost wage payment check you receive. With regard to the payment you are entitled to receive, there are different factors taken into account:
Average Weekly Wage (AWW)
Insurance adjusters calculate your lost wage payments based on your average weekly income. Your insurer validates your weekly wage based on payroll documents submitted by your employer. Moreover, 52 weeks of gross income preceding the date of your injury are required to calculate your AWW.
Three Day Rule
When receiving lost wage payment checks, there is a known regulation called the "three-day rule." It's a waiting period that functions similarly to a deductible, wherein it starts once you miss work or earn less income and is subtracted from your first check. On some occasions, you can request reimbursement for the three days. Alternatively, you may use your sick leave, time off, or vacation to compensate for the waiting period.
To help you recover faster and cover any lost income incurred while you cannot work, employers provide two-thirds (66%) of your average weekly income as payment. State laws mandate this percentage, so insurance companies must provide the appropriate amount. However, keep in mind that there are maximum and minimum amounts you are eligible to receive.
Even if you return to modified work or have other sources of income, such as paid time off, vacation, or unemployment benefits, you can still qualify for lost wage benefits. You must inform your insurance adjuster of any such income so that they can adjust your workers’ comp lost wage payments to reflect it. Also, your wage loss compensation is not reduced by secondary disability insurance.
Depending on the circumstances, if more than one employer employed you at the date of injury, you might be eligible to have both incomes taken into account when calculating your average salary per week (AWW). This is referred to as "dual" or "concurrent" employment.
Degree Of Disability
Your disability degree or injury severeness is carefully considered when determining the rate at which your benefits are paid. The following measures below are put in place to determine this:
- Your doctor may provide a medical opinion of your disability, or the insurer may commission an independent medical investigator to examine you
- In instances where your doctor and the independent medical examiner disagree regarding the severity of your disability, you may negotiate with the insurance company or request a court trial to determine which opinion is more accurate
Usually, there are four fixed degrees of disability — mild (25%), moderate (50%), marked (75%), and total (100%). Anything less than a total (100%) disability is considered a partial disability.
There is no exact answer to the question, “How much does workers comp pay for lost wages?” since multiple factors can affect the amount you receive. If you are wondering whether your workers’ comp benefits are taxable, read this article from Disability Help.