Do You Have to Pay Back Workers’ Comp Benefits?

Workers’ compensation is a form of insurance that provides financial support to employees who are injured or become ill as a result of their job. It covers medical expenses, rehabilitation, and lost wages while you recover, so you don’t have to worry about paying out of pocket when you’re unable to work. But many employees wonder if they’ll have to pay back their workers’ comp benefits later, especially if they file a lawsuit or return to work sooner than expected.

The short answer is: No, you generally don’t have to pay back your workers’ comp benefits. However, there are a few important details to understand about how the system works.

How Workers’ Compensation Benefits Work

Workers’ compensation is designed to support you during a difficult time when an injury or illness prevents you from doing your job. Each state has its own workers’ comp laws, but the general structure is the same across the country:

• Medical expenses: Workers’ comp will pay for your medical treatment, including doctor visits, surgeries, medications, and rehabilitation therapy, as long as the treatment is related to your workplace injury or illness.
• Wage replacement: If your injury prevents you from working, workers’ comp will provide a percentage of your average weekly wages, typically around two-thirds of your normal pay. This compensation helps cover your living expenses while you recover.
• Disability benefits: If your injury or illness leads to a long-term or permanent disability, you may be entitled to disability benefits, which compensate for the loss of future earning capacity.

No Repayment Required

Unlike loans or other forms of assistance, workers’ compensation benefits are not something you have to pay back. These benefits are provided through your employer’s workers’ compensation insurance. They are intended to help injured employees without causing financial hardship. Whether you are receiving temporary benefits while you recover or long-term disability payments, you don’t owe any repayment.  You don’t need to repay the workers’ comp insurer, your employer, or the state.

There is only one time when workers’ compensation might intersect with repayments. This is if you receive a settlement or damages from a third-party lawsuit related to your injury.

For example, was your injury was caused by a defective machine or the negligence of someone other than your employer? You might be able to file a separate lawsuit. If you win damages in that lawsuit, the workers’ comp insurer could claim a portion of your settlement to reimburse what they paid in benefits. This is known as a “lien” or “subrogation.”

Hiring an Attorney for Your Workers’ Comp Claim

While you don’t have to repay workers’ comp benefits, you may need to pay attorney fees if you hire a lawyer. Many workers’ comp attorneys work on a contingency basis. This means they only get paid if they successfully help you secure benefits. In most states, attorney fees are regulated. They typically come out of your settlement or award, so you won’t have to pay out of pocket.

Why You Shouldn’t Worry About Repayment

The purpose of workers’ comp is to help injured employees, not to burden them with additional financial obligations. If you’re receiving workers’ compensation benefits, you don’t have to worry about paying them back. This is true as long as you follow the proper procedures and file your claim in good faith.

Are you struggling to get the benefits you deserve? Are you unsure about the workers’ comp process? Consulting an attorney can make a huge difference. We specialize in protecting the rights of injured workers. Contact Shugarman & Mehring today to schedule a consultation and get the expert guidance you need for your workers’ comp claim.