A disability claim starts when an employee experiences a disability or injury that prevents them from working or earning an income. Once an employee files a claim, the process typically includes medical documentation of their condition, assessing their work duties, and determining how the disability affects their ability to work.
A common fear about employees filing claims is the risk of lost productivity. Not to mention the increasing expense for a business. Though it may be true, there are also ways to improve your operations.
Here are some of the negative and positive impacts of disability claims on your business.
Aside from the administrative expenses like processing paperwork and paying benefits to the employee while they're out of work, some disability claims may take a long time to resolve. That's because employees' applications for disability claims can either be severe or less serious.
If your employee's condition is more severe and requires extensive medical documentation, they may apply for SSDI benefits. However, this claim may take months to review and approve. Insurance companies need to check their medical records first. They then determine if the disability relates to the job duties, and therefore, is under the workers' compensation. If not, then they may approve it for issuing payment.
However, if their condition falls under the less severe category, their claim will likely process quickly. Some can get their payment within 14 days after their application approval.
Although various insurance coverages are essential for business success, a disability claim can be costly for employers. Not only do businesses have to pay the cost of benefits, but they may also experience a loss of productivity due to the absence of the employee. This is especially important for small businesses that rely on them to handle numerous tasks.
Additional costs employers may also face include; hiring a replacement worker when another worker is on disability leave. For example, a business may incur hiring and training fees for the new employees while the original employees are out of work. Some companies, however, delegate the responsibilities. This means employees may need to take on the extra work or cover for their colleagues. This, in turn, may create resentment and conflict in the workplace.
Offices, retail stores, and other businesses can also be vulnerable to legal claims by employees with disabilities. Thus, it’s important not only for insurers to know about the claim process, but also, for business leaders to be knowledgeable of the continuation or termination policies of disability claims.
Employees experiencing less severe disabilities only have 12 weeks in one year to enjoy their claim benefits. During this time, all employers must pay their disability benefits to the employees and keep their job. On the other hand, employees who have successfully availed of long-term disability insurance get to enjoy its benefits for a specific number of years, or even until they turn 65.
Only upon the lapse of this period can employers make decisions on whether the involved employee can continue with their work or get terminated. If an employer fails to acknowledge and apply this mandate, they're at risk of being sued for unlawful termination if employees get fired before the period specified.
When an employee is out on disability, it can be difficult for some co-workers to maintain morale. This is especially true if the worker is out for an extended period. Speculation about why the person is out is made by other employees. This can lead to tension in the workplace and can impact productivity.
On the bright side, some employees might feel better about their job security if they know that the company provides benefits to disabled workers. For example, some employees don't need to worry that they might lose their job after a long illness or injury at any time. Knowing that they have access to benefits if they’re unable to work can help reduce stress and anxiety caused by disability or illness.
Also, disability claims can help create a more diverse and inclusive workplace. When employees have an extended leave of absence, they can spend valuable time healing from their condition. This can help strengthen relationships with family and friends. This helps to promote a healthy perspective on life.
These claims can also help create an open conversation about accessible benefits for everyone. As employees see the value in these, they can become more comfortable discussing their own needs with their employer. All these things can improve morale and productivity in the long run.
Disability claims can significantly impact your business, both financially and emotionally. It's essential to be aware of these impacts and how they can affect your business. By understanding the process of disability claims and the potential consequences, you can be better prepared to handle them if they arise in your workplace.