Short Term Disability vs. Workers’ Compensation: What’s the Difference?
If you cannot work due to an injury or illness, you may have the right to seek financial compensation and benefits from short-term disability insurance or workers’ compensation. But how do these two benefits differ from one another?
Understanding Short-Term Disability Insurance
Some employees may have access to short-term disability insurance, either through policies that employees have purchased on their own or through policies provided as a job benefit through their employer. Short-term disability insurance typically provides financial benefits for workers who sustain non-work-related injuries or illnesses that temporarily disable them from working. A disabled worker can receive income replacement through short-term disability insurance for several weeks or months. Under most policies, workers may have to observe a waiting period before they can begin receiving benefits.
However, for disabilities that last longer than a few months, short-term disability insurance coverage will expire, requiring a disabled worker to seek financial support through other means, such as long-term disability insurance or Social Security disability benefits.
Understanding Workers’ Compensation
Workers’ compensation provides financial benefits to workers who suffer work-related injuries or illnesses. Under the workers’ compensation system, employers or insurers must pay for medical treatment/rehabilitation, partial reimbursement of lost wages, and defined permanent disability benefits to employees with work injuries and occupational illnesses. Workers’ comp operates as a “no-fault” system, meaning an employee does not need to prove that their employer bears any fault for their injury or illness to trigger coverage. Instead, an employee becomes entitled to workers’ compensation benefits simply because they sustained a work injury or illness.
Differences Between Short-Term Disability and Workers’ Comp
Short-term disability insurance and workers’ compensation differ from one another in several ways, including:
• Cause of the injury/illness: Short-term disability insurance usually covers non-work-related disabling injuries and illnesses, whereas an employee who suffers a work injury or occupational illness will usually turn to workers’ compensation for benefits.
• Source of benefits: Workers’ compensation benefits come from an employee’s employer, as the state mandates that most employers must provide workers’ comp. Conversely, short-term disability insurance represents an optional benefit provided by some employers or a private insurance policy purchased by an employee.
• Coverage: Workers’ compensation can pay for medical treatment/rehabilitation and provide financial compensation for permanent disabilities. However, short-term disability insurance usually only provides wage replacement when an employee misses work during the coverage period.
How to Decide Which Benefits to Apply For
A worker should file a claim for short-term disability benefits after becoming unable to work due to a non-job-related injury or illness. Conversely, when a worker sustains an injury or illness due to their job, they should file a workers’ compensation claim with their employer.
Contact a Workers’ Compensation Attorney Today
After you’ve suffered an injury that leaves you unable to work, you may have the right to seek financial compensation through workers’ comp or short-term disability insurance. An experienced workers’ compensation attorney from Stine & Associates, P.C. can help you evaluate your legal options. Contact our firm today for a free, no-obligation consultation with our legal team to get the advice and advocacy you need to recover from a workplace injury.