Workers compensation insurance is a federally mandated, state-regulated insurance program that protects your business if an employee gets injured or becomes ill as a result of work-related activities. It is intended to help workers get back on their feet and back to work by providing benefits to employees including paying medical bills, covering lost wages, rehabilitation, retraining, and more. But where did it come from? Who started the idea of having workers compensation and why has it become such a necessity in the American workplace?
Workers compensation actually began way back in 2050 B.C., according to Gregory Guyton’s A Brief History Of Worker’s Compensation, when the ancient Sumerian law outlined compensation for injury to a worker’s specific body parts. For example, if a worker lost a thumb this was worth half the value of a finger. The Ancient Greeks, Roman, and Chinese laws also had a similar result for specific injuries and monetary compensation for the body parts. Their distinction between the loss of a body part and the loss of ability to perform certain tasks still inform our worker’s compensation laws today.
With the Industrial Revolution brought dangerous working conditions where hazards were common and injury rates were astronomical. These workers rarely received compensation for their injuries due to restrictive legal options. However, in 1906 and 1908, Congress passed the Employer’s Liability Acts which made contributory negligence doctrines less restrictive and in 1911 Wisconsin passed the first comprehensive worker’s compensation law.
Today most states require employers to carry worker’s compensation insurance for their employees. If your state does not require it, you are still required to cover expenses if an employee sustains a work-related injury. Carrying workers’ compensation insurance protects your company from the potentially overwhelming costs associated with work-related accidents or an employee filed a lawsuit. Workers Compensation is designed to protect you and your employees by providing coverage for the high costs of workplace injuries, lost wages, occupational death or disability of an employee, or even lawsuits from negligence. Even if you are not required to carry workers’ compensation insurance by state law, it is a smart business decision. Call us at 844-Gannon start a discussion about workers compensation insurance today.