During this economic turmoil, many employers are forced to lay off some of their work force.  In considering workers compensation issues, layoff preparations must be considered.

Make sure that as the employer you notify your claims administrator that you are going to have to make layoffs.  Make sure that you also notify your legal counsel to help address any legal issues which may come up as you select those to be laid off.

If you have any workers currently receiving temporary total disability benefits consider bringing them back to work BEFORE their positions are eliminated.  If the worker does not have a job to return to, they may have a difficult time proving that they are fit for work.

If severance packages are limited to those employees who are actively working, it may discourage those “questionable” workers compensation claims.  Workers compensation benefits no longer look attractive to those laid off because the severance could be more valuable in the long run.

In Arkansas, workers cannot obtain unemployment benefits unless they are able to work.  Those with workers compensation injuries who are limited to light duty will not be eligible for benefits.

To assist your employees during such a stressful time, you might consider bringing in professionals to assist with outplacement of those displaced.  This could result in a smoother transition and give the employees a feeling of respect.

Realize that some fraudulent claims may be made for workers compensation benefits after a layoff is announced.  Never assume that claims made during this time are fraudulent, but diligent research will be required.  Some red flags include a claim that is filed after other benefits have been exhausted, the reporting of the claim was unusual, the claim was not witnesses or reported on the day it occurred, inquires are made to human resources or others regarding other sources of income, medical treatment does not begin when expected, but rather upon knowledge of the impending layoff.

One important consideration in handling workers compensation claims, particularly during times of job reduction and elimination, is that all available resources must be conserved.  Reductions in workforce are an obvious attempt to reserve financial resources, but services such as case management might also improve your bottom line.  Case Management can obtain work releases, obtain estimated length of disability/treatment, build rapport with your employees to prevent unnecessary litigation expenses, use their relationships to obtain prompt appointments and prevent unnecessary delays and increased lost wage benefits.  For more about case management check out some of these other posts.