Workers’ Compensation Claims: Back to the Basics – Temporary Disability Benefits

Rispoli & Borneo P.C.

NJ Workers Compensation Lawyer

NJ Workers Compensation Lawyer

Every employer in the State of New Jersey is required to purchase workers’ compensation insurance.  If you are injured at work, you are entitled to benefits under your employer’s New Jersey workers’ compensation insurance policy.  Those benefits include temporary disability benefits, medical benefits and a permanency award.  The purpose of this post is to discuss temporary disability benefitsprovided in a typical workers’ compensation case.

Temporary disability benefits are designed to compensate an injured employee for lost wages.    If an employee is out of work for seven (7) consecutive days, he is entitled to temporary disability benefits.  These benefits are paid out at 70% of the employees Average Weekly Wage (“AWW”).  They are payable for as long as the employee is out of work because of the work related injury.

Your Elizabeth NJ work accident lawyer will tell you that the purpose behind the seven day waiting period is to avoid payment of temporary benefits to an employee that receives only a minor injury.  By way of example, if an employee lacerates his arm on a saw, at work, and can return to work after five (5) days, he is not entitled to benefits.  However, if the laceration requires ongoing treatment and prevents the employee from returning to work for sixty (60) days, he is entitled to 70% of his AWW for the entire time he was unable to work.

What exactly is AWW and how is it calculated? An employee’s Average Weekly Wage is his average gross pay over a twenty-six week period.  The twenty-six week time frame is not mandated by law, but it has come to be the standard by which the insurance company determines the amount of temporary disability benefits.  If an employee receives overtime this will be included in the calculation to accurately reflect what the employee was making during a typical week. If the employee has not been employed for a full twenty six weeks, the insurance company will obtain the wage history for as many weeks as available and use those figures to calculate the AWW.  In the rare case, where an employee is injured during the first few days of employment, the employee’s contracted rate is used to determine temporary disability benefits.  Here is a familiar example for a NJ workers’ compensation lawyer: if a full time employee is injured on the second day of work and is hired at $15 per hour his AWW will be 40 hours x $15 per hour or $600 per week, even though the employee never received a pay check for a full week of work.  Temporary disability benefits would be paid at 70% or $420 per week.

Temporary disability benefits are terminated once the treating physician determines that the employee is fit to return to work.  The physician can return the employee to work without restrictions.  This indicates the employee is fit to return to full employment.  The physician may also return the employee to work on “light duty”.  If the employer can accommodate the “light duty” restrictions, the employee must return to work and the insurance company can legally terminate temporary disability benefits.

As an experienced Workers’ Compensation attorney in Elizabeth, I am often consulted when an employee is returned to work by the treating physician but the employee does not feel that he is capable of returning to work.  In this situation, the first step is to negotiate with the insurance company for additional treatment and additional temporary disability benefits.  If the insurance company will not agree to pay additional temporary benefits, the employee has the option of filing a Motion for Medical and Temporary Benefits.  This places the issue before a Workers’ Compensation Judge for consideration.  Such a Motion requires a medical report, testimony from the injured employee and testimony from a medical expert.  Accordingly, the assistance of an experienced NJ Workers’ Compensation Attorney is recommended.