Workers' compensation
Workers' compensation is a state-run no-fault system paying medical costs and partial wage replacement for workplace injuries, in exchange for which employees generally cannot sue their employer directly.
No-fault means you do not have to prove the employer did anything wrong. The trade-off is that the benefits are limited and there is no compensation for pain and suffering.
Wage replacement is a fraction of what you earned, typically around two thirds and subject to a state cap.
A third-party claim against someone other than the employer — a subcontractor, a property owner, an equipment manufacturer — is usually where the real recovery is, and it is not restricted the same way.
Related terms
- Impairment rating — An impairment rating is a physician's percentage assessment of permanent loss of function after maximum medical improvement, used mainly in workers' compensation to calculate the permanency award.
- Maximum medical improvement — Maximum medical improvement, or MMI, is the point at which an injured person's condition has stabilized and is not expected to improve further with additional treatment.
- Statute of limitations — A statute of limitations is the legal deadline for filing a lawsuit, which varies by state and by claim type — commonly two to three years for personal injury — and after which the claim is barred permanently.
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