Waiting periods are variable in every jurisdiction. Michigan for example has a 7 day waiting period before wage loss benefits start. TTD starts on the 8th day, and if still off by day 14 then the first 7 days are then picked up and paid if the worker is still out of work. Wisconsin is a little different, with a 3 day waiting period and TTD starting on day 4, with days 1-2-3 being picked up if the worker is not back by day 8.These examples of waiting periods show the differences between states. Some are more, some are less. They are meant to be used in good faith, to give the employer time to investigate and report an injury to their carrier, and then for the carrier to take receipt of the injury and complete their investigation.
Waiting Periods Are Being Used In Bad Faith
Sadly, I have viewed examples of waiting periods used against the injured worker in bad faith. Not to avoid paying the claim, but in bad faith by trying to save money and not compensate the injured worker for those days wages.
Let us use Michigan as an example. Say a worker reports an injury and goes for treatment. The injury is common, witnessed, and there are no outstanding issues. Instead of placing the worker in a light duty program where they can continue to be compensated, they are placed off of work, in a feeble attempt to starve out the employee in order to gain a full duty release quicker than normal.
This worker has a laceration injury, their hand is wrapped up, and they cannot perform their normal job. The carrier/employer state that they cannot accommodate the restriction of keeping the wound “clean and dry.” The worker then is released to full duty after 6 days of disability, and returns to work on day 7. In the Michigan jurisdiction, this means the worker will net $0 in TTD payments.
Let us now view this from each standpoint:
- The carrier is OK with this, since the file still would remain a non-lost-time file because the worker did not clear the waiting period to be eligible for TTD. They have a full duty release. The injury was not questioned or suspicious. Their file will consist of paying a couple medical bills and will close. In their mind, perhaps they feel they saved their client 6 days of light duty work at the workers regular wage because the worker was not placed in the light duty program.
- The employer had a worker sustain a minor injury. The medical was paid for. They were not on the hook for paying normal gross wages for a worker in their light duty work program, so essentially they saved 6 days of gross wages.
- The worker is not very happy. They sustained an injury, and yes the medical was paid but they were not placed in any light duty position. Surprise to the worker, they knew nothing about a waiting period in work comp. After talking with the adjuster they learn they were taken for a ride with their last 6 days of pay; the worker is very displeased—and rightfully so. The 6 days of pay could mean a lot to that worker, and to their family. Now this worker has a large mistrust for their employer, and they will let anyone and everyone know about it.
Taking everything in to consideration, was this worker treated fairly? The obvious answer is no. If a light duty work program does indeed exist, why would they not be placed in to that program, to save a measly few days of pay? Is this what workers mean to carriers and employers? The empathy for an injured worker exists very little these days, and that is really a shame.
A Sad & Outrageous Practice
Carrier/employers may use these types of cases to show a statistic—saved money on work comp cases. A case here and there might not amount to much, but think about if a carrier utilized this tactic on every case. Placing workers back to work (in Michigan) on day 8 after an injury which means that this worker will lose out on 7 days of pay. Over the course of a policy year the savings could be sizeable. However, as an employer if you are cutting the throats of your own employees by utilizing this tactic, after they were injured working for you, then everyone else should be outraged.
It is very easy to be disassociated with work comp. Injured workers become file numbers. The human factor is removed. An adjuster working at a desk 5 states away will never see this worker, their family, and probably will care very little if at all. If the work comp world has become this callous, and this far removed over saving minimal amounts of dollars then I hope this practice is not as commonplace as I think it could be. The fact that I even have to mention something like this happening within the realm of workers compensation is a sad for all of us in this business.
Author Michael Stack, Principal, COMPClub, Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%. He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and founder of COMPClub, an exclusive member training program on workers compensation cost containment best practices. Through these platforms he is in the trenches on a monthly basis working together with clients to implement and define best practices, which allows him to continuously be at the forefront of innovation and thought leadership in workers’ compensation cost containment. Contact: firstname.lastname@example.org.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.