Wisconsin Worker's Compensation Act (Act)
Before 1911, a worker who was injured in the course of his or her employment could sue his or her employer in a civil or "tort" action, which was the same remedy available to a person injured under other circumstances. The tort remedy, however, had certain problems. It required the worker to prove that the injury occurred because the employer was negligent and the employer had three important defenses: (1) that the worker was also negligent, (2) that the worker knew of the dangers involved and "assumed the risk," or (3) that the injury occurred because of the negligence of a "fellow employee." Under this system it was very difficult for workers to recover against their employers. If they did win, however, there were no dollar limits on what a jury could award.
In 1911, Wisconsin adopted a Workmen's Compensation Act. The new remedy is essentially a "no-fault" system under which a worker no longer has to prove negligence on the part of the employer, and the employer's three defenses were eliminated. The intent of the law was to require an employer to promptly and accurately compensate a worker for any injury suffered on the job, regardless of the existence of any fault or whose it might be. In return, the Act limited the amount that a worker could recover. Workers are only entitled to (1) certain wage loss benefits, (2) the cost of medical treatment, and (3) certain disability payments. Under the old system, workers had been able to recover for pain and suffering, loss of enjoyment of life, and other damages that a jury might award. Recovery under worker's compensation is limited to these three areas, no matter how serious the injury.
The law requires that every employer subject to the Act must provide some way of assuring that it can pay benefits to its workers should they become injured. Most employers in Wisconsin provide this security by purchasing an insurance policy from a private insurance company. The insurance company then reports to the State of Wisconsin Department of Workforce Development (DWD) that it is providing coverage for the employer. Some employers, however, are "self-insured."
Questions often arise concerning the interpretation of the coverage and exclusion requirements of the law. Information and assistance concerning these issues is available from the Wisconsin Worker's Compensation Division, Bureau of Insurance Programs at (608) 266-1340.
A copy of the Worker's Compensation Act of Wisconsin can be found at http://www.dwd.state.wi.us/wc/legal/default.htm.