Workers’ compensation is a type of insurance that provides financial benefits to employees who are injured on the job or become ill as a result of their job.
The insurance is typically provided by employers and is mandatory in most states and countries, including Nigeria. Workers’ compensation covers medical expenses, lost wages, and rehabilitation costs for employees who are injured or ill due to work-related activities.
The purpose of workers’ compensation is to provide a safety net for employees who are injured on the job, while also protecting employers from lawsuits and financial liability.
In Nigeria, the Workers’ Compensation Act of 2010 requires employers to provide workers’ compensation insurance to their employees, and provides benefits for employees who are injured or killed on the job.
Common Workers’ Compensation Compliance Mistakes to Look out For
Failure to provide workers’ compensation insurance is one of the most common compliance mistakes made by employers.
In 2019, Facebook was fined $65,000 by the state of New York for failing to provide workers’ compensation insurance to its contractors. Similarly, in Nigeria, the Lagos State Government fined a construction company N10 million for failing to provide workers’ compensation insurance to its employees.
Misclassifying employees as independent contractors is another common mistake made by employers. This can lead to denial of workers’ compensation benefits to employees who are injured on the job. For example, in 2018, the Nigerian courts ruled that a driver who was classified as an independent contractor by his employer was entitled to workers’ compensation benefits after he was injured in an accident while driving for the company.
Failure to report workplace injuries and illnesses is also a common compliance mistake. Employers are required to report workplace injuries and illnesses to the relevant authorities, and failure to do so can result in fines and penalties.
For instance, in 2020, a manufacturing company in Nigeria was fined N5 million for failing to report a workplace injury that resulted in the death of an employee.
Inadequate record-keeping is another compliance mistake made by employers. Employers are required to keep accurate records of workplace injuries and illnesses, including the date and time of the injury, the nature of the injury, and the medical treatment provided.
Failure to keep adequate records can make it difficult to determine whether an injury or illness is work-related, and can lead to denial of workers’ compensation benefits.
Employers who fail to provide a safe working environment for their employees can also be held liable for workers’ compensation claims.
For example, in 2019, a Nigerian court ruled that an employer was liable for the death of an employee who was killed in a workplace accident due to the employer’s failure to provide a safe working environment.
In conclusion, workers’ compensation compliance is critical for employers to avoid fines, penalties, and lawsuits.
Employers must provide workers’ compensation insurance, accurately classify employees, report workplace injuries and illnesses, keep adequate records, and provide a safe working environment to avoid common compliance mistakes.