What Happens if You’re Laid Off While on Workers’ Compensation?

The current economic crisis has much of the workforce on edge about the safety of their jobs. Many American companies have had to temporarily close their doors amid COVID-19 concerns, not knowing when they’ll be able to resume business or if they will need to lay off employees in the meantime to cut costs. But what happens to the employees receiving workers’ compensation benefits during this tumultuous time? Is it within a company’s rights to lay off these workers and, if so, do they still continue to receive benefits?

Being injured and jobless at the same time, especially during an economic crisis, is a scary scenario. Shook & Stone is here to answer your pressing questions on the matter and to represent you if your rights have been violated.

Defining Workers’ Compensation Benefits

In order to answer the question of whether you can be laid off while on workers’ comp, let’s first define what workers’ comp is and what it covers.

Workers’ compensation is a type of mandatory insurance that all employers are required to have in the event that an employee becomes ill or injured as a direct result of their job. If this were to happen, workers’ comp benefits would cover the employee’s lost wages, medical costs, and potentially their rehabilitation expenses. These benefits enable employees to pay their bills and cover their living expenses while they are recovering and unable to work. If an employee accepts these benefits, they forfeit their rights to sue the company for negligence.

Can I Receive Workers’ Comp After Being Laid Off?

Workers Compensation Form

Unfortunately, you could very well be legally laid off while relying on workers’ comp to recover from an injury. These benefits do not give you immunity to company downsizing or other related events. But the good news is that even though workers’ comp does not equate to severance pay, you could still receive benefits after a layoff. Those on leave for workers’ compensation when a layoff occurs may be eligible to receive benefits up until they are able to work again. At this point, the benefits through the company would discontinue and the employee would have to find work elsewhere.

What Constitutes a Legal Layoff While on Workers’ Comp?

Employers are not required to give special treatment to those on workers’ compensation benefits. Simply being on workers’ comp for temporary disability does not protect you from being laid off. Employees on leave can be fired or laid off for any legal reason not related to the injury. Layoffs are usually well-thought out and planned in advance.

So, if you think you have been targeted, look at the bigger picture to be sure. If your employer has proof that the layoff you experienced was planned in advance and impacted other employees besides you, you would not have a case for wrongful termination. A company is well within its rights to protect its financial stability even if some employees lose their jobs in the process.

When Is a Layoff Illegal Under Workers’ Comp?

Employers are within their rights to lay off an employee on workers’ comp leave if the layoff is unrelated to the injury or workers’ comp claim. For instance, your employer may have plans to lay off your entire department in favor of outsourcing due to budgetary cuts. In this case, your employer isn’t required to accommodate you or protect your job simply because you are on workers’ comp leave.

On the other hand, if you were singled out and fired because of your injury, your employer could not disguise the termination as a layoff to avoid liability. Federal and state laws protect employees from termination for filing workers’ comp claims, including the Americans With Disabilities Act (ADA). Under this and other laws, your employer cannot fire you, lay you off, demote you, harass you, or otherwise retaliate against you for acting within your rights under workers’ compensation. This is considered a case of illegal retaliation and is grounds for a wrongful termination lawsuit. In this scenario, you should call on the help of a qualified workers’ compensation attorney.

Contact Shook & Stone to Pursue Justice on Your Behalf

In any case, you can speak to a workers’ compensation attorney at Shook & Stone if you feel that you’ve been a victim of wrongful termination or unlawful retaliation due to a work injury. Targeting employees for a temporary or permanent disability is illegal, and our job is to hold employers accountable for their actions.

Challenging your employer is never easy, but we ease your burden by being alongside you as you gather evidence to bolster your case and increase your chances of winning in court. At Shook & Stone, we have a proven track record of success, and we’re ready to go to bat for your rights. But don’t delay — there is a statute of limitations of 300 days in Nevada for wrongful termination, and we need as much time as possible to build a case against your employer. Give us a call today for a case consultation and start breathing a little easier.