The role of workers’ comp
It’s a simple question, but unfortunately it may not have a simple answer: What is the role of workers’ compensation?
An answer to this question is important because it affects how an injured worker is compensated once he or she hits retirement age.
“This is a debate that really goes back to the beginning of workers’ compensation,” said Scott Szymendera, a Congressional Research Service analyst.
Speaking during a hearing on the Federal Employees’ Compensation Act program before the House Education and the Workforce Committee on July 10, Szymendera broke down the question into two basic arguments:
1. Workers’ comp is simply year-to-year wage loss. If this is the argument, then once an individual hits retirement age – whatever that age may be – then logically he or she should no longer receive payments. “There’s no wages to replace,” Szymendera said of retirement. “They wouldn’t be working otherwise."
2. Workers’ comp is intended to provide a benefit to workers injured on the job. For an injured worker, the financial repercussions of the injury extend beyond wage loss, and if the goal is to replace those costs, then the argument of cutting off payments at retirement age becomes harder to make, Szymendera said. “A person remains permanently disabled into their 60s, 70s, 80s, however long,” he said. “They’ve lost lifetime earning capacity."
Choosing between these two arguments can be complicated, and many issues need to be considered:
- Congress has established that employers are responsible for the safety of their workers, but those employees cannot – in most cases – sue their employers if they become injured on the job.
- Some injured employees receiving workers’ comp may wind up earning more in retirement than if they had otherwise never been injured.
- Some costs an injured employee could recoup in an off-the-job injury – such as pain and suffering – are not available for on-the-job injuries in the workers’ comp system.
- In at least the Federal Employees’ Compensation Act program, career advancement is not factored in, meaning the workers’ comp payment for a 22-year-old permanently disabled worker will be based on his or her salary at the time of her injury – even when that worker is 60 and may have previously had a promising future.
So what’s fair? I’d love to hear what you think – please leave your thoughts in the comment section below.
The opinions expressed in "Washington Wire" do not necessarily reflect those of the National Safety Council or affiliated local Chapters.