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Possible Effect on Workers’ Compensation Benefits if Minimum Wage is Raised

If you have been injured on the job, you may have applied for workers’ compensation benefits, which will take care of your medical bills, lost wages, and more after sustaining an injury. In New Jersey, workers’ compensation benefits help compensate many victims after they have been involved in a workplace accident. Since many workers depend upon them, it would be a drastic change if these benefits were affected in a negative fashion.

Various Types of Workers’ Compensation Benefits

When a worker is injured, their employer or insurance carrier will pay for necessary medical treatment, lost wages during a period of rehabilitation, and even benefits for permanent disability. Here are the various types of benefits you may receive if you apply for workers’ compensation:

  • Medical Benefits: Medical treatment, prescriptions, and hospitalization services related to the injury sustained on-the-job are paid by either the employer or insurance carrier.
  • Temporary Total Disability Benefits: If an injured worker is disabled for more than seven days, they will be eligible for these benefits at a rate of 70% their average weekly wage. Benefits will usually be terminated when the worker is released to return to work or reaches MMI.
  • Permanent Partial Benefits: Benefits in this case will be based upon a percentage of certain losses and are paid weekly.
  • Permanent Total Benefits: These benefits are paid when a work injury or illness prevents a worker from returning to any type of gainful employment.
  • Death Benefits: If a worker dies because of a work-related injury or illness, then the dependents of that worker may be eligible to receive death benefits.

Recent Changes Within New Jersey Legislature

On February 11, 2016, Stephen Sweeney (President of the New Jersey State Senate) proposed a ballot to amend the State Constitution that would help raise the state’s minimum wage to $15 per hour. However, this could have a direct correlation to temporary disability benefits and what people may expect to receive. With this new legislation, the minimum wage would be raised to $9 and then to $1 per year until $15 is reached; however, this would effect what employers pay their current minimum wage workers if they become injured in the workplace. The increase would affect, most directly, workers who work 22.5 hours or more each week.

For year 2016, a worker injured on the job currently will be entitled to a minimum temporary disability benefits rate of $232 a week due to the fact that minimum wage is at $8.35 per hour. That means, in order to earn weekly wages equivalent to the minimum temporary disability benefit rate of $232, a worker will have to work at least 27.78 hours per week. However, if the minimum wage is raised to $15 per hour, a worker will only have to work 15.4 hours to earn the equivalent of the minimum temporary disability benefits rate in 2016.

What this means is that all angles will be viewed very closely when decisions are being made. The New Jersey Legislature has acted upon matters regarding minimum wage in the past. In fact, in New Jersey, an approved ballot in 2014 raised the minimum wage from $7.25 to $8.25. For those who have been injured on the job, they will need to watch for any updates on these matters.

2017-11-13T16:52:55+00:00