What Workers Comp Actually Pays For
Workers compensation insurance covers your employees when they get injured or sick because of their job. In construction, that covers a lot of ground. Falls from ladders, power tool injuries, back strains from lifting, heat exhaustion, repetitive stress injuries, even car accidents on the way to a job site in some cases.
Here is exactly what it covers, what it excludes, and how the process works.
Medical Benefits
Workers comp pays 100 percent of reasonable and necessary medical treatment related to the work injury. There is no deductible for the employee. No copays. No annual limit.
Covered medical expenses include:
- Emergency room visits
- Surgery and hospitalization
- Doctor visits and specialist consultations
- Physical therapy and rehabilitation
- Prescription medications
- Medical equipment (braces, crutches, prosthetics)
- Mileage to and from medical appointments
In California, the employer or insurance carrier gets to direct medical treatment for the first 30 days. After that, the employee can choose their own treating physician if they pre-designated one before the injury.
Temporary Disability Benefits
If your employee cannot work while recovering, workers comp pays a portion of their lost wages. In California, temporary disability pays two-thirds of the employee's average weekly wage, up to a statutory maximum that adjusts annually.
For 2024, the maximum weekly temporary disability rate in California is $1,619.15. The minimum is $242.86. Benefits begin after a three-day waiting period unless the employee is hospitalized or off work for more than 14 days, in which case the waiting period is waived retroactively.
Permanent Disability Benefits
If an injury leaves the employee with a permanent impairment, workers comp pays permanent disability benefits. A doctor evaluates the permanent impairment using the AMA Guides and assigns a disability rating from 1 to 100 percent.
The rating determines the dollar amount. A 10 percent permanent disability rating in California might pay $15,000 to $20,000. A 50 percent rating could exceed $100,000. Ratings above 70 percent trigger life pension payments.
Death Benefits
If an employee dies from a work injury or occupational disease, workers comp pays death benefits to their dependents. In California, the maximum death benefit is $320,000 for one total dependent, plus $250,000 for each additional dependent up to a maximum total. Burial expenses up to $10,000 are also covered.
Vocational Rehabilitation
If the employee cannot return to their previous job, workers comp may provide a supplemental job displacement benefit. In California, this is a voucher worth up to $6,000 for education or retraining at an accredited school.
What Workers Comp Does Not Cover
Injuries outside the scope of employment. If your laborer gets hurt playing basketball on the weekend, that is not a workers comp claim.
Self-inflicted injuries. If an employee intentionally injures themselves, the claim is denied.
Injuries while intoxicated. If alcohol or drug use contributed to the injury, the claim may be denied or reduced.
Independent contractors. Workers comp only covers employees. If you hire 1099 subcontractors, they are responsible for their own coverage. However, California is aggressive about reclassifying independent contractors as employees when the relationship does not meet the ABC test.
Horseplay. If the employee was engaged in horseplay or activities outside their job duties when injured, coverage may be denied.
Common Construction Claims We See
| Injury Type | Typical Scenario | Average Cost | |-------------|-----------------|--------------| | Falls from height | Roofer falls from ladder | $40,000-$100,000+ | | Struck by object | Framing material falls on worker | $15,000-$50,000 | | Cuts and lacerations | Table saw injury | $10,000-$75,000 | | Back injuries | Lifting heavy materials | $20,000-$80,000 | | Electrocution | Contact with live wire | $50,000-$200,000+ | | Heat illness | Working in extreme temperatures | $5,000-$25,000 | | Repetitive stress | Shoulder/knee from repetitive tasks | $15,000-$40,000 |
How to Handle a Claim
When an employee reports an injury:
- Get them medical attention immediately
- File a DWC-1 claim form with your carrier within 24 hours
- Document the incident with photos and witness statements
- Report the claim to your insurance carrier the same day
- Keep the employee informed about their rights and benefits
- Work with your carrier on modified duty to bring the employee back as soon as medically appropriate
Prompt reporting is critical. Late-reported claims cost 30 to 50 percent more on average because delays lead to complications, attorney involvement, and worse outcomes.
Keeping Your Costs Down
Your workers comp premium is directly tied to your experience modification rate. Every claim increases your mod, and every mod increase raises your premium for three years. The best way to control costs is to prevent injuries in the first place.
Invest in safety training, provide proper equipment, enforce fall protection protocols, and create a culture where employees report hazards before they become injuries.
Call (949) 200-7171 if you need workers comp coverage or want to review your current program. We work with carriers who specialize in construction and understand your trades.