Consider Using Third Party and Offsite Return to Work Options

Employers who are conscientious about the cost of the workers compensation insurance coverage know the importance of having an established Return to Work program. (See our Transitional Duty Policies and RTW programs). The employers who provide light duty or modified duty work for the injured employees lower the overall cost of workers compensation through lower claim cost. Return to Work programs result in the reduction of the overall amount of time the employees are off work, a reduction in the overall cost of physical rehabilitation and a reduction in the overall cost of medical care. The lower claim cost results in lower workers compensation premiums.

Many employers have tried Return to Work programs, only to give up as the modification of the employee’s regular duties is often difficult to accomplish while maintaining any sense of productivity. Employers are often reluctant to pay employees the regular wages if the employee is not accomplishing anything. The cost of wages paid to a totally unproductive employee often exceeds the increased cost of workers compensation.

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“13 Research Studies to Prove Value of Return-to-Work Program & Gain Stakeholder Buy-In”

The dilemma of the unproductive injured employee who should be returned to light duty work, but the employer cannot afford the cost of doing so, has led to a whole new industry of companies that assist employers in a return to work program. There are companies, sometimes referred to as the reemployment service industry, that now specialize in placing injured employees in light duty work on a temporary basis.

These third party return-to-work placement firms (RTW directory) often have contacts as various charitable organizations where they will arrange for the injured employee to work until the employee is able to return to his/her regular job without restrictions.

For example, consider the long-haul truck driver who injured his back unloading the truck. The medical providers advise the employee can return to work, but should not lift more than 10 pounds, should not stand for more than an hour and who should not be seated for more than an hour. The restrictions on lifting and being seated eliminate the truck driver from doing his normal job, as the job cannot be modified enough to allow the truck driver to work. The third party job placement firm arranges for the truck driver to work at a local charity sorting donated clothes. The work can be done either standing or seated, and the employee is allowed to change from standing to being seated at will.

The charity pays the employee for the hours. Often, the rate of pay is lower than what the employee would have earned in the regular job. The difference between the employee’s regular earnings and the employee’s light duty earnings is partially covered by the workers compensation insurance. For example, the employee was earning $600 per week and the temporary total disability (TTD) rate while the employee is not working is $400 per week, two-thirds of the regular wages. If the employee is working light duty for the charitable organization, and earning $300 per week, the employee would not receive TTD but temporary partial disability (TPD) which pays the employee two-thirds of the difference between the regular wages and the temporary light duty wages. In this example, the employee would be paid a TPD rate of $200 per week. [Calculated: $600 regular pay minus $300 light duty pay results in a $300 reduction in earning capacity. $300 X 2/3 TPD rate = $200]. This is the win-win situation every employer wants. The employee receives $500 per week ($300 wages at the charitable organization plus $200 TPD) instead of $400 per week, while the cost of indemnity benefits for the insurer or employer is reduced from $400 per week (TTD) to $200 per week (TPD).

If the rate of pay from the charity exceeds what the employee would have made on the job, no temporary partial disability payments are owed to the employee.

FREE DOWNLOAD: “13 Research Studies to Prove Value of Return-to-Work Program & Gain Stakeholder Buy-In”

The light duty placement companies do several things to ensure the success of the temporary duty process. They will interview the prospective employer to verify the job requirements are within the work restrictions given by the medical provider, prepare the employee for the job interview if one is required by the temporary employer, provide directions to the temporary employer, verify attendance, follow-up with both the temporary employer and the employee to be sure both are comfortable with the new working situation, and when necessary, review the new job with the employee’s physician.

If the employer can return the injured employee to work at the old job on a modified basis, that is the best return to work program. If the employer cannot return the injured employee to work on a modified duty basis, the placement of the employee in a temporary light duty job for another employer is always preferable to the injured employee not working.

If you have questions about the return-to-work through a light duty job placement firm, please contact us for assistance and refer to our resource directory.

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: [email protected].

WORKERS COMP MANAGEMENT MANUAL: www.WCManual.com

MODIFIED DUTY CALCULATOR: www.LowerWC.com/transitional-duty-cost-calculator.php

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

FREE DOWNLOAD: “13 Research Studies to Prove Value of Return-to-Work Program & Gain Stakeholder Buy-In”

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