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Factors that Determine Workers’ Compensation Benefits in New Jersey

On Behalf of | Mar 26, 2024 | Workers' Compensation |

Workers’ compensation benefits provide support for employees who suffer job-related injuries or illnesses. The Bureau of Labor Statistics reports that over 2.3 million non-fatal workplace injuries occurred in 2022 across the United States.

Determining the amount of benefits an injured worker receives in New Jersey depends on three main criteria.

1. Severity of injury

More severe injuries tend to qualify for higher benefit amounts. The reason is that these injuries have longer recovery times and result in permanent impairments. Employees with such catastrophic on-the-job injuries often receive the maximum allowable workers’ compensation benefits. This may continue until they reach full medical recovery or maximum medical improvement.

Examples of serious work-related injuries include traumatic brain injuries, burn injuries covering a large portion of the body, spinal cord injuries causing paralysis, amputations, and severe fractures.

2. Extent of disability

The amount of the benefits also depends on an injured worker’s degree of disability. New Jersey has three classifications for disabilities:

  • Temporary total disability: The employee is temporarily unable to work at all for more than a week while recovering;
  • Permanent partial disability: The employee has reached maximum medical recovery but still has some permanent impairment that reduces their earning capacity; and
  • Permanent total disability: The employee’s disability completely prevents the person from being able to work gainfully at any job.

Employees with more severe disabilities may qualify for higher wage replacement benefits.

3. Average weekly wage

Because workers’ compensation benefits serve as a partial wage replacement benefit, an employee’s wages are another element in the calculation. Key factors that impact the average weekly wage include the employee’s base pay rate and any overtime, tips, commissions, or bonus pay the person earned.

The length of time the employee worked for the employer and earnings fluctuations and trends also play a role. Higher wage earners typically receive higher weekly workers’ compensation benefit payments. However, benefits are still subject to statutory limits, even for high earners.

Each situation is unique. An injured person cannot necessarily expect the results of one claim to be the same as another. A worker needs to prove these factors with credible evidence to get the maximum amount of compensation.