Workers' Compensation: An Incredible Benefit

The idea of workers’ compensation is pretty amazing if you think about it. If you are injured on the job, then you are entitled to paid medical benefits and a certain percentage of your regular income for as long as it takes to get better. If you wind up with a permanent disability, then you may be entitled to some compensation for life. However, employees weren’t always so lucky.

19th Century Negligence

The idea of compensating citizens for injuries goes back to the oldest of city-states like Ur and Babylon. Ancient Arab law provided specific payouts for losing various body parts right down to the size of a person’s ear and the amount of a finger lost. However, under the feudal system individual lords were given much more leeway in how much or how little they would compensate their peasants and serfs for injuries sustained on the fields and during wars. By the time of the Industrial Revolution, when massive iron machines and super-hot steam engines were making jobs more dangerous than ever, workers’ compensation was at an all-time low. In both the United States and the United Kingdom, common law precedents dictated that employers only had to pay their workers if they were at fault, and there were three big ways they could avoid such a ruling:

• Contributory negligence. If the employee was in any way at fault for the injury, the employer was off the hook. In one case, this meant that a railway worker who fell because of a faulty railing was at fault because his job included inspecting the railings.
• “Fellow servant” rules. If another employee caused the injury, even if just in part, the employer wasn’t obligated to pay a thing.
• Assumption of risk. This was the trickiest rule of all. If an employee knows that his or her job is hazardous, then he or she can’t blame the employer for being injured by a known hazard. This led to employers effectively forcing their employees to sign away their right to sue in their contracts of employment.

A Prussian Change

The first modern workers’ compensation law was actually passed in Prussia in 1884. Prussia’s leader, Chancellor Otto von Bismarck, had recently outlawed the Prussian Social Democratic Party and to avoid any outcry he passed several of the economic reforms they had demanded. This included implementing no-fault workers’ compensation insurance which would pay out regardless of the circumstances surrounding an injury. The idea of mandatory insurance was unappealing to companies in the UK and USA, but as time passed they gradually came to realize that workers’ compensation might be a better option than fighting constant legal battles in the civil courts with injured workers, plus despite their best efforts the employers weren’t always winning. The UK passed a no-fault workers’ comp law in 1897, and although it was left as a state matter in the US, the vast majority passed workers’ comp laws in the 1910s. Unfortunately, even the original Prussian model of workers’ compensation was widely considered arcane and overcomplicated, and that fact hasn’t changed much at all in the past 100 years. While workers’ comp may be no-fault, meaning that it pays out the same regardless of the cause, it can still be useful to consult with a workers’ compensation lawyer in order to make the claims process as smooth and as simple as possible. After all, every cent an insurance company pays out in claims is a cent taken from its profit margin, and so claims adjusters are often pressured to find whatever loopholes and excuses they can find to avoid paying out what you deserve. If they’re faced with the expense of a possible lawsuit, however, they may reconsider the cost to benefit ratio in your favor. Even if you never go to court, hiring a good lawyer from a reputable firm may wind up paying for itself.

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19th Century Negligence

A Prussian Change