How does workers’ compensation work for remote employees?

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Workers’ compensation programs protect workers who are injured on the job from financial hardship. Determining the validity of a workers’ compensation claim is easy when the worker suffers an injury in the office or on the factory floor, but what happens when the workplace moves beyond a traditional office environment?

Does workers’ compensation cover remote employees?

Yes, employees who work remotely still qualify for workers’ compensation. Any injury sustained during the course of working that would normally be covered is still covered when the employee does not work in an office.

This is true regardless of whether the employee works at home, as a “digital nomad,” or on assignment in a different location. When it comes to workers’ compensation claims, the nature of the injury is more important than the location at which the worker sustained it.

That said, workers cannot simply claim any injury sustained in their typical place of work qualifies for workers’ compensation. The worker owns the burden of proof and must submit sufficient evidence to prove that the injury happened in the line of work. Remote employees must prove their injuries happened while performing activities to further the interest of their employers, so injuries sustained while cooking dinner or mowing the lawn do not count.

What is the difference between workers’ compensation and liability insurance?

Workers’ compensation provides coverage for workers who are injured in the course of performing their duties for work regardless of where that work occurs. Liability insurance covers anyone who happens to be on company property, not just workers, and typically does not cover events that occur off the company’s physical property.

Consider a few separate scenarios. A person working from home who suffers a repetitive motion injury from too much typing could be covered under workers’ compensation. An employee traveling for work who falls down the hotel stairs and breaks her foot could also be covered by workers’ compensation. A customer who visits the company’s office and sustains an injury after slipping on a puddle would be covered by traditional liability insurance. 

The two types of coverage sometimes apply to the same scenario. A worker who falls down and sustains an injury on company property may in some cases be covered by both liability insurance and workers’ compensation. Which policy pays out depends on the nature of the injury and the terms of the coverage.

How can companies protect themselves and their remote employees?

If companies are responsible for taking care of workers who suffer injuries while working remotely, but those companies cannot control remote work environments, what should they do to protect themselves and their teams?

First, every company with remote workers needs workers’ compensation coverage with specific clauses addressing remote work. Although the employee bears the burden of proving any claimed injury occurred during the course of work, employers should not mistake that dynamic for protection against improper claims. Anything that could cause an injury in an employee’s home could be interpreted as a workplace hazard, depending on circumstances.

To protect workers, companies should help their teams identify and eliminate (or at least mitigate) risks in their remote workplaces. Something as simple as a budget for ergonomic home office equipment could protect workers from injuries that would necessitate workers’ compensation claims.

Companies should also clearly define what their workers’ duties entail. Not all home computer activity is work activity, for example. Some companies may attempt to do this by clarifying work hours, but as more employees work flexible hours, this may not be a sustainable solution. Space-related, equipment-related, and task-related definitions are easier to control than time-related ones. While workers may still successfully claim workers’ compensation for injuries that fall outside defined parameters, these definitions are still useful as guidelines.

Do workers’ compensation laws vary by country?

Yes. Workers’ compensation laws, insurance regulations, and their relationships to remote work vary from one country to another. Managing compliance can quickly become overwhelming, especially for companies with employees in multiple countries.

Remote makes it easy to stay compliant with labor laws no matter where your employees live and work. We take care of payroll, benefits, taxes, and local legal compliance so you can focus on growing your business. Contact us today to learn more about our global employment solutions.

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