How Texas workers' compensation Temporary Income Benefits work:
When an employee is injured and their employer subscribes to Texas worker's compensation insurance, the employee will generally be able to collect compensation in the form of benefits for their injuries.
One type of benefit injured workers are able to receive is called Temporary Income Benefits. This article will explain the amount of Temporary Income Benefits an injured employee is entitled to receive under the Texas Labor Code.
Questions answered on this page:
- What are workers' compensation Temporary Income Benefits?
- How are Temporary Income Benefits Calculated?
- If you're hurt on the job in Texas, can you get paid for lost wages?
- What percentage of lost wages must workers' compensation cover?
What are Temporary Income Benefits?
In a Texas workers' compensation case, injured workers don't actually receive compensation for lost wages, at least not in the traditional sense. Instead, the workers' compensation insurance carrier uses a formula created by lawmakers to determine how much a worker should receive in the form of wage-type benefits when they are unable to work due to an injury. In other words, rather than pay workers for the exact amount they would have earned had they not been injured, Texas law instead says that a worker gets something kind of like wage payment, and it's based on a convoluted formula.
Depending upon what phase of a workers' comp case the employee is in, they may receive one of several types of Income Benefits. The first type of Income Benefits that a worker is eligible to receive are known as Temporary Income Benefits. This is the main type of "pseudo lost wages" compensation that workers get under the Texas workers' comp system.
Once an injured employee has missed 7 day of work, they become eligible to receive Temporary Income Benefits. Beginning with the 8th day that an injured worker cannot work, until they have achieved what is known as maximum medical improvement, Temporary Income Benefits provide money for an injured worker to pay bills and get by while they are unable to fulfill their regular job duties.
The basis for this benefit is found in Section 408.101 of the Texas Labor Code:
TEMPORARY INCOME BENEFITS.
- (a) An employee is entitled to Temporary Income Benefits if the employee has a disability and has not attained maximum medical improvement.
- (b) On the initiation of compensation as provided by Section 409.021, the insurance carrier shall pay Temporary Income Benefits as provided by this subchapter.
And Section 408.102 of the Texas Labor Code:
DURATION OF TEMPORARY INCOME BENEFITS.
- (a) Temporary Income Benefits continue until the employee reaches maximum medical improvement.
- (b) The commissioner by rule shall establish a presumption that maximum medical improvement has been reached based on a lack of medical improvement in the employee's condition.
It's important to note that in the subsequent sections we will delve pretty far into the formulas used to calculate workers' comp Temporary Income Benefits. These formulas won't make sense without understanding of the basic metrics called the Average Weekly Wage. The Average Weekly Wage simply how much a worker earns on average over the most recent 13 weeks of employment history. So, in the past 13 weeks, add up the amount a worker has earned and divide it by 13. The resulting figure is the Average Weekly Wage.
Also, you'll hear mention of the State Average Weekly Wage, and that is simply the amount the typical Texan earns per week. Workers cannot earn more than this amount in Temporary Income Benefits.
What is the amount of Temporary Income Benefits an injured employee can receive?
The amount of Temporary Income Benefits an employee can receive is calculated one of two ways, depending on the level of pay they were earning prior to the injury. First, let's consider the way that Temporary Income Benefits are calculated for workers who make more than $10 per hour, found under Section 408.103 of the Texas Labor Code:
- (a) Subject to Sections 408.061 and 408.062, the amount of a temporary income benefit is equal to:
- (1) 70 percent of the amount computed by subtracting the employee's weekly earnings after the injury from the employee's average weekly wage;
Here's how to interpret that. Essentially, they say that an injured worker is paid 70% of the difference between their Average Weekly Wage and what they now earn post-injury. Well, for most workers, they are injured badly enough that they earn $0 in actual wages, so the formula would essentially be: Temporary Income Benefits = .7(Average Weekly Wage - $0). Or, more simply put, for most workers who are unable to work, they will receive 70% of their Average Weekly Wage.
A second possible situation is where a worker is injured, but not so much that they cannot perform, other, lighter duties for their employer. In most instances these lighter duties will pay less than what the worker was making before the injury. In this instance, the injured worker would be eligible (in most cases) for 70% of the difference between what they were earning before the accident and the lower amount that the lighter duties paid.
For example, imagine that before an employee is injured they make $400 a week, then after they are injured they only make $200 per week. So the employee's income after the injury would be $200 ($400-$200), and they would be entitled to receive 70 percent of that, or $140, as Temporary Income Benefits.
For workers who make less than $10 per hour, the relevant portion of the labor code is also found in Section 408.103, as follows:
- (2) for the first 26 weeks, 75 percent of the amount computed by subtracting the employee's weekly earnings after the injury from the employee's average weekly wage if the employee earns less than $10 an hour.
Regardless of which way the amount is calculated, the amount of Temporary Income Benefits an employee receives cannot exceed the employee's actual earning from the previous year. The amount of actual earnings of an employee are determined by their wage reports given to the Texas Workforce Commission, and must be approved by the Worker's Compensation Commissioner. Further, a worker's Temporary Income Benefits cannot exceed an amount equal to the State Average Weekly Wage. So, imagine that the State Average Weekly Wage is $800 per week. If a worker was earning $2,000 per week before his injury, and $0 post-injury, then the Temporary Income Benefits formula appears at first blush to suggest that he would receive 70% of 2,000, or $1,400 per week. But, since $1,400 per week is more than $800 per week, he will only receive $800 per week. This is just an example, and the amount of State Average Weekly Wage changes from year to year.
How a Texas Workers' Compensation Attorney Can Help
While these calculations should be a simple matter of plugging your previous income into a previously determined formula, every day mistakes occur that undervalue an injured worker's Temporary Income Benefits. When this happens the law entitles injured workers to a disputed benefits hearing, so that they can argue their case. The key to prevailing in such a a hearing is to know the law and have your paperwork in order. An experienced workers' comp attorney can help.
If you have any questions regarding the amount of Temporary Income Benefits you are receiving, feel free to contact our experienced work injury lawyers; we can help guide you through the process. Our attorneys have helped thousands of clients determine their rights under the law and receive the compensation that they deserve. Call today for a free consultation regarding your workplace injury at (855) 326-0000.
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