Welcome to the third post in our series covering information from the TWC’s Conference for Employers seminar series. As the sole private attorney at these events so far, Natalie has been able to gather a significant amount of information on the types of compliance issues the TWC plans to focus on.
So far, we’ve covered wage issues and matters related to Title VII and investigations. Today, we pour over what they want businesses to know about workers’ compensation and how you can avoid costly problems.
(Also, just a reminder that you can catch up on all the latest compliance changes by signing up for our monthly Zoom class with the Treaty Oak team. Register here.)
What the TWC Says You Should Know about Worker’s Comp to Avoid Problems
Before we dive in, a few Texas workers’ compensation stats from the TWC that might interest you:
- 24% of private employers do not carry workers’ compensation, amounting to around 13% of employees.
- 82% of injured employees receive care within the first week.
- 84% return to work within six months.
- 81% – that’s how much workers’ compensation premiums have decreased since 2003.
- $338 million – that’s how much workers’ comp healthcare costs have decreased since 2012.
Okay, on to questions:
How does workers’ compensation work in Texas?
Workers’ compensation in our state is a no-fault system regulated by the Texas Department of Insurance. It covers medical bills and lost wages for work-related injuries regardless of fault.
Ours is the only state that does not require employers to have workers’ compensation insurance.
What benefits does a business gain by having workers’ compensation insurance?
It helps employers manage costs related to work injuries, including medical bills and lost wages. Additionally, having insurance limits employer liability and provides legal protections. Finally, injured employees receive necessary medical treatment and income replacement benefits, which can matter when trying to attract or retain talent.
It’s worth noting, though, that a huge change in how the courts interpret this has recently happened. We’ll be discussing it at our monthly legal update.
Since it’s not required, what happens if your business doesn’t have workers’ compensation insurance?
If you decide not to get workers’ compensation insurance:
- You must report annually using form DWC-005
- You need to inform employees about the lack of coverage.
- You need to use form DWC-007 to report work-related injuries and illnesses.
- You face risks, such as potential lawsuits from employees, who retain common law rights.
Businesses without workers’ comp insurance who fail to file form DWC-005 may be hit with administrative penalties – potentially including fines.
Are there exceptions to what workers’ compensation covers?
Yes. Exceptions include injuries resulting from intentional acts, horseplay, intoxication, or voluntary social or sporting events.
The full list of exceptions is in the Texas Labor Code, section 406.023.
How are workers’ compensation premiums determined?
The premiums you pay are based on the industry risk, payroll, and the employer’s claim history over the past three years. Quite simply, less hazardous industries have lower premiums.
How can you control costs related to workplace injuries and illnesses?
60 to 80 percent of workers’ compensation claims involve medically unnecessary lost time. What can you do to minimize this?
- Improve safety culture in the workplace and create procedures and processes to keep employees safe.
- Engage in regular training and onboarding with safety in mind.
- Establish a stay-at-work or return-to-work program to reduce costs associated with overtime, temporary hires, and medical bills.
What is your role in the return-to-work process?
Start by reporting injuries immediately to insurance carriers and conducting non-judgmental investigations. When employees are out of work due to injury, make sure you’re maintaining positive communication with them about returning to work and offering suitable positions while they recover.
It is also recommended to involve employees in setting up return-to-work programs.
As you can imagine, these are super technical rules, and you should work with an attorney when you have an injured employee to prevent any mistakes.
What responsibilities does your insurer have in the return-to-work process?
Insurance carriers are responsible for paying benefits and medical care, investigating claims, and maintaining communication with injured employees.
Additionally, they should provide return-to-work coordination and assign case managers for complicated cases.
What role do healthcare providers play in the return-to-work process?
Beyond providing high-quality medical care, healthcare providers are responsible for determining when it is safe for injured employees to return to work.
They also need to communicate any work restrictions to you using the DWC-73 form.
What resources does the Division of Workers’ Compensation offer?
The Division offers a webpage with videos and information for employers, insurance carriers, and medical providers. They also provide training and occupational safety consultations free of charge, and the Division’s Lone Star Safety Program recognizes employers with excellent safety records.
Bottom line? Even though Texas doesn’t require employers to have workers’ compensation insurance, there are still compliance issues to consider, and you may be doing your business a big disservice in the long run by skipping out on insurance now.
Want to talk more about the pros and cons of each path and how to make sure your business is as protected as possible? We’ll be discussing this exact matter here.
