A Human Resources Guide to Workers’ Compensation Terms
A human resource manager has many duties including recruiting and hiring, serving as a link between employees and management, and evaluating worker performance. Perhaps the most complex issues HR managers deal with concern workers’ compensation insurance. When a worker is injured on the job, HR managers may be required to deal with workers’ compensation administrators, claims adjustors, doctors, and attorneys. Those familiar with workers’ compensation tend to use a collection of abbreviations concerning injuries and claims that can be confusing to those less acquainted. What follows are a few definitions of common workers’ compensation terms every HR manager should become familiar with:
Average Weekly Wage (AWW): This term defines the average earnings of an injured employee during the 52 week period prior to an injury. In cases where an injured worker has permanent partial impairment, it is necessary to know the average weekly wage to determine the amount of disability compensation owed. If the period of employment is less than 52 weeks prior to the injury, the earnings during that period should be divided by the number of weeks of employment1.
Carpal Tunnel Syndrome (CTS): According to the Bureau of Labor, carpal tunnel syndrome is a major cause of workers’ compensation claims and results in the highest number of days lost among all work-related injuries. Almost half of the carpal tunnel cases in the U.S. result in 31 days or more of work loss and the average cost of carpal tunnel surgery is $30,0002.
First Report of Injury (FROI): When employees are injured on the job, HR managers are required to file a FROI form with their workers’ compensation insurance provider3.
Independent Medical Examination (IME): In most states, employers and insurers can request that injured workers undergo an examination by an impartial physician, chiropractor, psychologist, or dentist to confirm the nature and severity of the claimant’s injuries4.
Temporary Total Disability (TTD): When employees cannot return to their jobs due to work-incurred injuries they are listed as temporarily totally disabled and entitled to receive TTD benefits during their recovery period. While recuperating, employees are entitled to receive 2/3 of their average weekly wage5.
Vocational (VOC) Benefits: In most state, injured employees who cannot return to their former job are entitled to vocational rehabilitation. VOC benefits are designed to train injured workers in new fields that will allow them to secure gainful employment6.
A human resources manager who can identify and understand the terminology of the workers’ compensation insurance industry should be well-suited to actively communicate with all parties involved in his organization’s workers’ compensation insurance claims.
1. J. William Snyder, Jr., “The Math of Workers’ Compensation,” Crumley & Associates, March 7, 2003, www.ibiblio.org/jwsnyder/wisdom/mathofwc.pdf.
2. Vanessa Friedman, “Rehab Solutions,” Self Funding Magazine, January 14, 2011, www.selffundingmagazine.com/article/reduce-workers-comp-claims-through.html.
3. “HR’s Guide to Workers’ Comp,” HR Hero, May 2012, www.hrhero.com.
4. “Independent Medical Examination,” State of Wisconsin, 2013, http://dwd.wisconsin.gov/wc/medical/ime.htm.
5. “Workers' compensation—Disability benefits: Temporary Total Disability,” Minnesota Department of Labor & Industry, 2013, www.dli.mn.gov/wc/DispBenTtd.asp.
6. “Vocational Rehabilitation and Workers’ Compensation,” Maryland Workers’ Compensation, 2013, www.mdcomplaw.com/info/your-case/vocational-rehabilitation.