What Happens if I Lose My Job While on Workers’ Compensation?

After a workplace injury or illness, your employer’s workers’ compensation insurance should provide benefits to cover your medical expenses and lost income. These benefits are critical to ensure that your job-related injury does not cause financial losses for you and your household.

Sometimes, these benefits might continue for some time if your recovery period is long. You should continue receiving benefits for as long as you need medical treatment or your injury keeps you from working. However, what happens if your employer terminates you while you are receiving benefits? The answer depends on your specific circumstances.

Employers Cannot Terminate You Because of Your Workers’ Compensation Claim

First, always keep in mind that your employer is not permitted to terminate you because of your workplace injury and workers’ compensation claim. The law prohibits employers from retaliating against employees because they are receiving benefits.

If your employer indicated that you were fired because of your injury or claim, you should speak to a lawyer immediately. There are legal remedies for people in this situation.

You Can be Terminated for Other Reasons

California is an at-will employment state, which means your employer can terminate you for any reason that does not violate the law. While a company cannot fire you for a workplace injury, it can fire you for other reasons. Some reasons for termination of injured employees might include:

  • Company budget cuts
  • Corporate restructuring
  • Poor performance reviews prior to the injury
  • Violations of company policy

These are far from the only lawful reasons for terminating an injured employee. In fact, your boss might fire you simply because they did not “like” you or other trivial reasons. These are legal as long as the given reason is not simply a cover-up for retaliation based on your workers’ compensation claim. An attorney can review the reasons for your termination and advise whether the reason might be pretextual or not.

Following a Lawful Termination

If your employer lawfully terminates you before you have made a full recovery from your injuries, you are still entitled to continue receiving benefits. Some employers might think that terminating you will also end the obligation to provide benefits, but the law protects workers in this situation as long as the termination was not based on employee misconduct.

Your benefits should continue until you have reached maximum medical improvement (MMI). This is true even if you are not an active employee of the company where your injuries happened. If your employer and its insurance company try to terminate your benefits, you should speak with a California workers’ compensation lawyer immediately.

Sometimes, if you cannot work for a long time – or even at all – due to a disabling work injury, you might receive a settlement offer upon your termination. This is a lump-sum payment that will replace all future benefit payments. It is essential that you have a workers’ compensation attorney review any settlement offers before you accept them. If you accept an offer that is inadequate, it can cause extensive financial issues moving forward.