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How are Workers’ Compensation Payments and Settlements Determined?

On Behalf of | Aug 28, 2019 | Firm News

Pittsburgh workers’ compensation lawyers will fight when your compensation payments are incorrect.

Eligible workers who have been hurt on the job in Pennsylvania should always file for Workers’ Compensation benefits. Employers are required to hold this type of insurance, whether through themselves as a self-insured entity, a state-run organization, or a private insurance company. However, getting Workers’ Compensation checks can be a complicated process.

Injured individuals may assume that they will simply receive back pay and money equal to what they were making. This is untrue. In fact, Workers’ Compensation claims can be paid out in a couple of ways. Namely, they are paid through regular payments based on the employee’s average weekly wage, or via a negotiated lump sum settlement.

Workers’ Compensation Payments

Employees whose Workers’ Compensation claim was approved can expect to receive about two-thirds of what they would have made per week when they were healthy, up to a maximum rate set by the Workers’ Compensation Act. It should be noted that this money is not taxable. The insurer examines 52 weeks of prior wages starting when the employee was hurt. Everything from tips to overtime can fall into this timeframe, which should give the best possible representation of the highest earning capacity.  The average weekly wage is calculated from this wage information.

Each year, Pennsylvania changes the maximum amount a weekly Workers’ Compensation payment can be. For injuries sustained prior to January 1, 2019, payments are capped at at different amounts based on the year of injury.  For example, the 2018 cap was $1,025, while the 2017 cap was $995.00. On and after January 1, 2019, the amount is $1,049. Minimums are based on a percentage of the average weekly wage related to specific parameters.

Concerns with Workers’ Compensation Payments

Anyone who has been injured while performing work for an employer must be concerned with potential Workers’ Compensation problems. The first has to do with the unchanging benefit amount. Once the rate for an employee’s Workers’ Compensation benefits has been set, it will not adjust for inflation. Many individuals find this troubling, especially if they are out of work for years and the cost of living goes up, but their benefits do not.

The second concern involves the calculation of average weekly wages. Workers’ Compensation attorneys often discover that insurers make mistakes when determining this amount. Even a difference of a dollar or two per check can quickly add up. Therefore, employees receiving weekly Workers’ Compensation payments may want to speak with a lawyer to check their calculations.

Lump Sum Settlements

After an employee receives four or more months of Workers’ Compensation checks in Pennsylvania, the insurance company or employer may offer the employee a lump sum settlement. Though a lump sum can sound like a windfall, it often represents less than the employee needs to live comfortably.  The amount of the settlement depends on the weekly compensation rate, the severity of the injury, the availability of alternative work, medical expenses and many other factors.  Settlement can be just for the weekly wage loss benefits or can include future medical expenses.

For this reason, workers who have been offered a settlement should always visit a knowledgeable lawyer to discuss their situations. Not only are they likely to get a higher settlement amount by working with an attorney, but they have legal representation if the Workers’ Compensation case goes to trial.

Pittsburgh Workers’ Compensation Lawyers at AlpernSchubert P.C. Advocate for Injured Workers

If you were injured at work, talk to a Pittsburgh Workers’ Compensation lawyer at AlpernSchubert P.C. today. We will review your case and obtain the compensation that you deserve. Call us at 412-765-1888 or fill out an online form for a free consultation. Located in Pittsburgh, we serve clients throughout Allegheny County, Lawrence County, Washington County, and western Pennsylvania.