Workers' Compensation is a federal program designed to cover costs for employees whose ability to work is compromised by an injury at the workplace or an occupational disease. Employees receive workers' compensation in exchange for relinquishing their right to sue their employer for negligence, an agreement known as "the compensation bargain."
The Department of Labor's Office of Workers' Compensation Programs (OWCP) has established and oversees four disability compensation programs:
- Wage replacement benefits
- Medical treatment
- Vocational rehabilitation
- Other benefits
In most states, employers must subscribe to workers' compensation insurance or be financially penalized. The federal government has its own workers' compensation program for federal employees.
Workers must undergo independent medical examinations (IMEs), scheduled and paid for by the employer's insurance company, prior to receiving workers' compensation. A wide variety of injuries and occupation-related conditions are commonly covered by workers' compensation, including:
- Spinal and joint injuries
- Fractures, sprains and strains
- Repetitive motion injuries
- Hearing or vision loss
On some occasions, stress-related ailments, such as ulcers, hypertension or psychiatric issues may be covered by workers' compensation if they can be proven to result from abnormal working conditions or to be the result of a work-related injury or illness.
Disability and death benefits are also part of workers' compensation. Disability benefits are separated into four categories:
- Temporary total disability
- Temporary partial disability
- Permanent total disability
- Permanent partial disability