New Jersey's system of workers' compensation is elective, meaning that employers can opt out of the worker's compensation system. In order to opt out, employers must carry liability insurance to cover their common law liability arising from workplace injuries. As no insurance companies offer the required coverage, for practical purposes, opting out is not an option.
Workers' compensation insurance may be provided through private insurance carriers or self-insurance. Waivers may be permitted to exclude certain employees from coverage, including sole proprietors.
Exemptions from coverage may apply to certain employees, including casual laborers.
Medical Benefits are provided to employees entitled to workers' compensation benefits, including coverage for necessary medical care.
The employer chooses the initial treating physician. The employee may change doctors with the consent of the employer or workers' compensation insurer, or upon successfully petitioning the workers' compensation agency for an order allowing the change.
Indemnity benefits are payable to injured workers to help make up for lost income. There is a waiting period of 7 days before a worker is eligible for indemnity benefits, which are retroactive to the date of the injury.
Benefits available to injured workers include the following:
Temporary Total Disability (TTD)
Temporary total disability (TTD) benefits are paid to workers who are unable to work due to injury, but who are expected to make full or partial recovery such that they may return to work. Benefits are based upon 70% of the injured worker's pre-injury weekly wage, subject to a cap, and continue for the duration of the temporary disability.
Permanent Total Disability (PTD)
When a worker is not expected to recover from a total disability caused by a work-related injury, and as a result suffers a total loss of earning capacity, the worker becomes eligible for permanent total disability (PTD) benefits. In New Jersey PTD benefits are calculated based upon 70% of the injured worker's actual wage, subject to a cap, and may continue indefinitely. Offsets may apply for Social Security disability benefits and public disability pensions.
Permanent Partial Disability (PPD)
Once an injured worker has recovered to the maximum possible extent, the worker may be able to return to employment but nonetheless remain partially disabled, and may potentially qualify for permanent partial disability (PPD) benefits. In New Jersey PPD benefits are determined based on a statutory schedule, and 70% of the worker's pre-injury weekly wage, subject to a cap. Benefits for unscheduled injuries are payable for a maximum of 600 weeks,
Temporary Partial Disability (TPD)
When a worker suffers an injury that limits his ability to return to work, resulting in a reduction of income as a result of reduced hours or wages, the injured worker may be eligible to receive a benefit based on the difference between the worker's pre-injury earnings and their reduced, post-injury earnings. Although New Jersey's statutes don't specifically address TPD benefits, there is case law supporting the position that TPD benefits are paid based upon the difference between the injured worker's post-injury wage and the TTD benefit the worker would receive if unable to return to employment.
For some, more serious injuries, workers' compensation indemnity benefits may be paid according to a statutory schedule, instead of following the standard model of the weekly benefit based on the duration of the disability. Scheduled injuries include such injuries as the amputation of an arm, the loss of a dominant hand, the loss of a leg, the loss of a foot, the loss of an eye, or loss of hearing in an ear.
Coverage may be available for cumulative trauma, mental stress and occupational hearing loss.
When a worker dies as the result of a work-related injury, workers' compensation pays additional benefits, including a burial allowance, and benefits for a surviving spouse and dependents. Survivor benefits are calculated based on 70% of the worker's wages, subject to a cap in amount. Benefits may continue for minors until the age of 18, the age of 23 if the dependent is a student, or indefinitely in the event of disability. Spousal benefits end upon remarriage, with the spouse potentially receiving a lump sum benefit.
Attorney fees are determined on a case-by-case basis, with a fee of up to 20% of the amount awarded.
This article provides a quick overview of the benefits available to injured workers, but the full formulas used for assessment of benefits, coordination of different types of benefits, and assessment of injuries and disability ratings can quickly complicate the determination of benefits. Also, states frequently revise their workers' compensation laws. Most workers who suffer a significant injury or wage loss as the result of a workplace injury will benefit from consulting a workers' compensation lawyer.
The state agency responsible for workers' compensation is:
New Jersey Department of Labor and Workforce Development
Division of Workers' Compensation
P. O. Box 381
Trenton, NJ 08625-0381