Workers’ compensation (WC) is an insurance system that pays monetary benefits to workers who become injured during their employment. Specifically, it pays medical expenses, lost wages, and ongoing care costs for injured workers.

Workers’ compensation (WC) laws are based on a balance between the needs of both employers and employees. The system is meant to be no-fault and non-adversarial. Employees give up the right to sue their employers for employment-related injuries in return for specific medical and wage-replacement benefits. State agencies will prescribe recordkeeping, posting, and reporting requirements.

Most private employers are covered by state WC laws. All WC laws follow the same basic premise, but there is a lot of variety in the details. Private employers should check with their state WC office for requirements and other details. Benefits generally include 100% of medical coverage and varying amounts of income benefits. Most employers are required to carry WC insurance. Some states do not require coverage, often if the employer has fewer than a certain number of employees (such as fewer than five).