Workers’ compensation in Texas is an insurance program that provides benefits to employees who are injured on the job or who contract a work-related illness. It’s meant to replace wages while recovering from an injury and protects against permanent impairment. Unlike traditional insurance, workers’ compensation is guaranteed by state law.
Compensation is payable for a variety of injuries and sicknesses. It can be given to an employee who is injured at work, suffers an on-the-job heart attack, or develops cancer from exposure to toxic chemicals. An employer is required by law to report work-related injuries within 48 hours of the injury.
What Is Work Injury?
An injury sustained on the job or during a work activity is covered by workers’ compensation laws regardless of how it happened or whose fault it was.
For example, if a worker trips on a co-worker’s toolbox and breaks his leg, it’s still covered by workers’ comp. If he falls off a ladder while shining your roof, it’s covered. If he suffers an injury because the electrical wiring in the building is faulty or outdated, that injury is covered as well. In order to receive workers’ compensation insurance benefits for injuries sustained on the job, an employee does not have to prove that their employer was at fault or negligent.
Texas requires that workers’ compensation policies be purchased through the state minimum deposit insurance fund. If a company is found to have made a fraudulent workers’ compensation claim, it will be prosecuted to the fullest extent of the law. In addition to criminal charges, fraudulently filing a claim can affect future policy rates and lead to denial of coverage for other employees.
It’s important to note that injuries purchased from an employer’s commercial general liability insurance policy are not covered by workers’ compensation benefits. If an employee is hurt at work while on the clock, it is the company’s responsibility to compensate them for their medical bills and lost wages.
How Compensation Is Determined
Workers’ compensation benefits are calculated in a standardized manner. Regardless of an employee’s injury, it’s always paid based on the following formula:
Worker’s compensation benefits are calculated by the following formula:
1) Adjusted Permanent Impairment (API) – this is a percentage that reflects how badly at work an employee has been injured. For example, if an employee breaks their leg, they will be entitled to 100% of their wages for two weeks. Because they were temporarily incapacitated from work, that is considered a permanent injury and can be compensated at 100%. A worker who breaks a leg on the job and suffers 80% permanent impairment will receive 80% of their wages for two weeks, then 20% for the remainder of their time off.
2) Weekly Average Wages (A.W.) – this is the sum of all wages an employee received in Texas from date of injury to date they return to work. For example, if an employee was injured on April 1 and returned to work on May 3, their A.W. will be $1.25/hr.
3) Range of Impairment (R.I.) – this is a percentage calculated from the previous two steps that is used to calculate how much money an employee can receive. For example, if an employee breaks their leg and requires 80% of wage loss, it will be calculated as 80% x $1.25/hour x 40 hours/week = $517.00 per week.
Find more information here – https://www.arawc.org/fast_facts/