Top 5 Workers Comp Mistakes Made by Employers

HR Resource
June 4, 2012 — 2,303 views  
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Employers charged with the responsibility of dealing with workers' compensation have a lot on their plate, and that may not be the only task charged to them within a given day. As a result of increasingly busy schedules and perhaps a lack of training in the subject matter, many employers can make mistakes.


Pay attention to common workers comp mistakes made by the average employer to be on the lookout for the similar behaviors in your own dealings.


Here are the top five mistakes employers make in workers’ comp:


1. Insufficient communication. Leaving the employee out of the internal investigation process and failing to keep them updated or insufficiently informed can alienate them and eventually lead to the development of combativeness. The employee is already injured - being left in the dark on how their claim is being handled can create added stress.

2. Correlating low rates to low costs. Unlike what many employers first believe, a reduction in rates rarely means a reduction in cost. The cost of Workers’ Compensation insurance acts as a line of credit to finance claims as they come in throughout the year. This credit is factored typically with a complex equation using specific industry standard injury rates. If an employer comes below the annual cost, they are often returned a credit for the eventual uptick in claims.

3. Failing to provide light duty options. Supporting a family is expensive and living off 60 percent of the typical wage is not conducive to a stress-free environment. An employer may be able to reduce their workers’ comp claims by offering work that meets the health requirements of the individual until they are healed.

4. Not being involved in the claims process. Failing to keep up with the claims process and the resulting investigation conducted by the insurance company can leave an employer at the whim of an outsider. Keep abreast of the ongoing process to reduce the chance of something going amiss.

5. Disregarding employee retention. According to the Mallory Agency, if a work-related injury is not handled correctly, an employer can easily lose a trained employee. If employees are not back to work within 12 weeks of the original injury, retention rates decrease to 50 percent.

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