Workers’ Compensation: Frequently Asked Questions

Workers’ Compensation: Frequently Asked Questions

Workers' Compensation

Knowing the current rules and regulations is crucial for protecting your rights should a work accident occur. To help you better understand your rights, here are the most frequently asked questions about the compensation system in North Carolina.

  1. What is Worker’s Compensation Insurance?

This is state-mandated insurance providing lost wages and medical expenses compensation for workers who suffer personal injury or occupational illness. The compensation system comprises laws and regulations ensuring workplace safety and helping workers overcome physical, psychological, and financial challenges related to workplace injuries or occupational diseases.

  1. What is a Workplace Accident?

Under North Carolina law, only specific injuries at work are considered an accident. The so-called “accident rule” states that a workplace accident is an interruption of the usual routine at the workplace by unexpected events such as falls, assaults, or other sudden untoward events. If an injury occurs as part of a standard work routine, it does not qualify as an accident at work. However, there are exceptions. A sudden occurrence of pain in the spine during routine work activities is considered a workplace accident (known as a specific traumatic incident”).

  1. What is an Occupational Illness?

An occupational disease is an illness resulting from the workplace environment or specific work duties. The nature of your work or your work environment caused or significantly contributed to the development of the disease. Occupational illness does not occur in a single event (such as a workplace accident) but develops over the years of working in a specific environment. The Occupational Safety and Health Administration (OSHA) defines occupational illnesses as any abnormal condition or disorder caused by exposure to factors associated with employment. The most common occupational diseases are carpal tunnel syndrome, bronchitis, asthma, chronic obstructive pulmonary disease, cancer, contact dermatitis, hearing loss, asbestosis, the tennis elbow, tendonitis, etc.  You can refer to NCGS § 97-53 for a list of occupational diseases.

  1. Are All Employees in North Carolina Insured?

Under North Carolina law, all employers with three or more employees must provide compensation insurance. However, the compensation system exempts certain types of employees from coverage. That includes employees of specific railroads, domestic servants (in a direct employment relationship with the household), federal government employees (whose status is regulated by federal law), casual employees, farm laborers, and sellers of agricultural products for the producers (on commission).

  1. Do Compensation Rules Apply to Injuries that Occur Away from Physical Workplace?

Receiving benefits does not depend on your physical presence at the workplace. Your physical location may not matter so long as you are performing work-related duties within the course and scope of your employment. This may include, under certain circumstances, going to and from work in a company vehicle, delivering a product, or participating in a business seminar abroad.

Compensation Claim
  1. Is There a Statute of Limitations for Filing a Compensation Claim?

In North Carolina, you must file a claim within two years from the date of injury. For occupational illnesses, the date of discovery of the condition applies. The law allows a three-year statute of limitations period in the case of employer retaliation claims.

  1. When Can I Receive a Lost Wage Pay?

Under North Carolina law, you can start receiving lost wages paid on the eighth day of your absence from work, provided your injury is preventing you from working less than 21 days. Contrary to that, if your absence lasts longer than 21 days, you will also receive retroactive benefits for the first seven days.

  1. How Frequent are Insurance Payments in North Carolina and at What Rate?

Workers in North Carolina receive insurance payments weekly at a rate of 66.6 % of the average weekly rate.  This is known as the Compensation Rate. The North Carolina Industrial Commission can allow monthly instead of weekly payments, but most people receive weekly payments.

  1. Can I Settle?

Yes. Workers can settle their claims by signing a clincher agreement or an IC form settlement. A clincher agreement is a settlement between an injured worker and employer or an insurance carrier regarding the compensation claim. The agreement provides that the worker gets compensation for any costs resulting from future medical treatment, including lost wages and other benefits. The agreement enabling the worker to receive a lump sum cash payment is subject to approval by the North Carolina Industrial Commission. The Commission Rule 502 provides the list of requirements the insurance company must meet for an agreement to get a green light. By signing, the worker has to hold the employer harmless and waives any future claims against the employer.

  1. Do I Keep the Job After Settling?

Yes, if you settle on an IC Form 26A.  However, if you settle by a clincher agreement,

Employees rarely are able to keep their job.

Clincher Agreement
  1. Can I Settle the Claim While Keeping My Job?

Yes. Aside from clincher agreements, there are IC form settlements, which allow the injured workers to keep their job and receive future medical treatment provided by the insurance carrier for a period specified in the form. Under North Carolina law, there are two types of form settlements: Form 26A and Form 21. Form 26A allows the worker to give up the right to future permanent disability benefits. In exchange, they receive the value of their disability benefits in weekly installments, and sometimes in a lump sum. The insurance carrier pays the installments based on the permanent disability rating.  IC Form 21 is rarely used today, and as a practical matter is really not worth discussing.

  1.  How to Calculate Compensation Settlement in North Carolina?

Multiple factors contribute to the calculation of the settlement value: the compensation rate, the injured part of the body, the PPD rating, preexisting conditions, the severity of the injury, etc. The underlying medical conditions play a critical role in determining the settlement value. For example, chronic illnesses, such as cancer or diabetes, and unhealthy lifestyles, such as smoking and alcoholism, contribute to the final calculation. These are conditions unrelated to work injuries, but they negatively affect life expectancy. Shorter life expectancy means lower projected medical costs. In addition, the severity of the injuries can significantly affect the settlement value. More severe injuries require more complicated medical treatment and longer recovery times, which results in higher expenses. Some costs are exempt from the claim amount in settlement, including attorneys’ fees, unpaid child support, and unpaid medical bills. Also, any necessary Medicare Set-Aside amount should be considered in the final calculation.

  1.  What is the Average Compensation Settlement in North Carolina?

There is no average compensation settlement because each case is different, and settlement figures are unique for each worker.  If at your first meeting with an attorney, that attorney guarantees you a certain amount you will receive for your settlement, excuse yourself and leave the office immediately.  Do not sign any documents with that attorney.

Servicing The Following Counties In North Carolina