Understanding Workers’ Compensation in Texas: What Injured Employees Need to Know

Autor: Shelby Benavidez 

Abogado colaborador: Mark O’Donnell, attorney 

Each morning, hard-working Texans get up, head to their jobs, and do their best to support themselves and their families. For most, work represents more than just a paycheck – it provides stability, security, and a sense of purpose. But when you’re injured on the job, that stability can vanish in an instant, and you’re left wondering how you’ll feed your family, pay your bills, or recover enough to return to work. 

A serious workplace injury can turn your entire life upside down. In those moments, you may wonder: What happens now? Who will help during recovery? 

That’s where workers’ compensation comes in. This guide explains everything you need to know about workers’ compensation in Texas, including how it works, what it covers, how payments are calculated, and how it differs from personal injury claims. Whether you’re recovering from a workplace injury or simply want to understand your legal options, this article provides a clear overview of the process and what to expect along the way. 

Workers’ Compensation Basics 

What is Workers’ Compensation? 

Workers’ compensation, or casually referred to as “workers’ comp,” is a state-mandated insurance program that provides benefits to employees who suffer work-related injuries or illnesses. It’s designed to protect both workers and employers. For employees, it ensures access to medical care, wage replacement, and rehabilitation services for medical emergencies that happened while on the job. For employers, it limits the risk of costly lawsuits by offering a structured system for handling workplace injuries. 

Workers’ comp covers injuries that occur while performing job duties, but it generally does not apply to injuries caused by horseplay, intoxication, or self-inflicted harm. Each state has its own rules, so the benefits and procedures may vary depending on where the injury occurs. 

How Does Workers’ Compensation Work in Texas? 

Texas is the only state that allows voluntary workers’ compensation insurance. This means that Texas allows business owners to elect whether or not they will provide workers’ compensation benefits for their employees. Employers who choose to participate in the state’s workers’ compensation system are known as subscribers, while those who opt out are called non-subscribers. 

When an employer is a subscriber, their employees are covered under the Texas Workers’ Compensation Act. If a worker is injured on the job, they can file a workers’ compensation claim through the employer’s insurance. In return, the employer is generally protected from most personal injury lawsuits filed by employees. The workers’ comp system becomes the exclusive remedy for the injury. Employees can receive benefits without having to prove fault, but they give up the right to sue their employer in most cases. 

On the other hand, some employers choose not to subscribe to the workers’ compensation system. These non-subscriber employers may have their own private injury benefit plans or, sometimes, no formal coverage at all. This may save the employer on insurance costs, but if an employee is injured while working for a non-subscriber, the worker can file a personal injury lawsuit directly against the employer. 

If you’re employer is a subscriber, your first step is to report the injury to your employer as soon as possible, ideally within 30 days. Either your employer or the insurance company may direct you to an approved medical provider for an evaluation. They will then set up a treatment plan if necessary. The insurance company will review your claim and determine if you are eligible for workers’ compensation benefits. 

What Will Workers’ Comp Pay For? 

Workers’ compensation in Texas typically covers three main types of benefits. The first is medical – workers’ comp will likely cover all necessary medical treatment related to the work injury. This may include doctor visits, hospital stays, prescriptions, surgeries, and physical therapy or rehabilitation, if necessary. In the event that the injured employee died as a result of the workplace incident, workers’ compensation insurance may also cover funeral expenses.  

Aside from medical expenses, workers’ compensation may also include income benefits, such as partial wage replacement for employees unable to work due to their injury. Texas categorizes these as Temporary Income Benefits (TIBs) for short-term injuries and Impairment Income Benefits (IIBs) for permanent partial disabilities.  

Finally, if the injured employee cannot return to their previous job due to the severity of their injuries, workers’ compensation may provide vocational rehabilitation. This may include retraining programs or job replacement assistance. 

Understanding the Texas Workers’ Compensation System 

How is Workers’ Comp Calculated in Texas? 

In Texas, income benefits are calculated based on a percentage of the employee’s average weekly wage (AWW) at the time of injury. However, the exact amount depends on the type of benefit. TIBs usually replace 70% of the employee’s AWW, up to the state maximum. IIBs, on the other hand, are based on the assigned impairment rating by a qualified doctor. This rating estimates the degree of permanent physical loss. 

There are state-mandated minimum and maximum limits for weekly benefits, which adjust annually. Understanding how these numbers are calculated helps employees estimate the financial support they can expect while recovering. 

When Does Workers’ Comp Start Paying in Texas? 

Workers’ compensation payments in Texas usually don’t start rolling in immediately after the injury is reported. The insurance company typically takes up to 30 days to either accept or deny the claim. If your claim is approved, all medical treatment costs that are directly related to the injury should be covered by workers’ compensation. If your claim is denied, they may try to bill your private health insurance or require you to pay out of pocket.  

If you’re receiving income benefits as a result of your workplace injury, these will typically start after a 7-day waiting period. However, if the employee is unable to work for more than 21 days, the insurance company should pay the first 7 days retroactively. Prompt reporting and filing are crucial to avoid delays in receiving benefits. 

How Long Does Workers’ Comp Last? 

The duration of workers’ comp benefits varies depending on the severity of the injury. Temporary benefits can continue until the employee can either return to work or reaches the maximum medical improvement (MMI). 

Permanent Partial Disability benefits are paid according to the impairment rating and capped by state limits, and Permanent Total Disability benefits are paid if the employee cannot work in any capacity. 

Medical benefits generally last as long as treatment is necessary and directly related to the work injury. It’s important to keep documentation of all treatments and follow-ups, as these records determine ongoing eligibility. 

Workers’ Compensation vs. Personal Injury 

Difference Between Workers’ Comp and Personal Injury 

When you’re injured at work in Texas, you basically have two roads to compensation. First, you can attempt to file a workers’ compensation claim through your employer. Because workers’ comp is a no-fault system, this provides guaranteed benefits regardless of who was at fault – as long as your claim is accepted. Through workers’ compensation, you seek treatment for your injuries at the expense of your employer’s insurance, and they may offer supplemental pay if you have to miss work due to the injury. The issue with workers’ comp arises when the insurance company tries to deny your claim or argue that your horseplay caused the injury. 

In contrast to workers’ compensation, personal injury claims require negligence of either your employer or a third party.  This may include blatant disregard for safety measures, failure to provide proper training or safety equipment, or intentional harm. Personal injury settlements may also cover medical expenses and lost wages, but in addition to those benefits, you can seek compensation for pain and suffering – which is not included with workers’ comp.  

Can You File Workers’ Comp and Personal Injury Claims? 

In Texas, you can file a workers’ compensation claim and a personal injury claim – in some cases. Every situation is unique, and the path you should take really depends on whether your employer carries workers’ compensation insurance and who was responsible for your injury.  

As mentioned previously, you would first attempt to file a workers’ compensation claim if your employer is a subscriber. You may be able to seek medical care and compensation for lost wages, and you wave your right to pursue a lawsuit. However, if workers’ compensation insurance tries to deny your claim, refuse certain medical treatment, or tries to say your actions caused the injury, you may need to consult with a workers’ compensation lawyer. They can help you navigate the process, collect necessary evidence and documentation, and guide you to a more successful outcome.  

If your employer is a nonsubscriber, the situation changes entirely. Because nonsubscriber employers don’t participate in the state’s program, they don’t have the same legal protections that subscribers do. If you’re injured at work, your employer has a responsibility to make you whole; therefore, you can file a personal injury lawsuit directly against your employer. 

Additionally, if a third party – like a contractor, subcontractor, property owner, equipment manufacturer, or another driver – is partly or fully responsible for the injury, the worker may also file a personal injury claim against that party. This can happen alongside a workers’ compensation claim, but it requires careful coordination to avoid conflicts or double recovery. 

Because the laws surrounding workers’ compensation and personal injury overlap in complex ways, we highly suggest you consult with a workers’ compensation or personal injury attorney before making any decisions. An attorney can help determine which claims you’re eligible to file, make sure your rights are protected, and pursue the maximum compensation available under Texas law. 

How Much Does a Workers’ Comp Lawyer Cost? 

Hiring a lawyer might sound expensive, but in Texas, workers’ compensation attorneys are paid on a contingency fee basis, meaning they only get paid if the client actually receives benefits. There are no upfront costs or hourly billing – payment comes directly from a portion of the benefits awarded. 

However, the way contingency fees work in workers’ compensation cases is a bit different from personal injury cases. In a personal injury claim, an attorney typically takes a percentage of the total settlement or verdict. But in a Texas workers’ compensation case, attorneys receive a percentage of the weekly income benefits paid to the injured worker – up to a maximum of 25%. 

Before an attorney can collect fees, they must submit a detailed, itemized fee request to the Texas Division of Workers’ Compensation (DWC). This request includes a line-by-line description of every service performed, the time spent on each task, and the hourly rate being requested. The DWC then reviews and either approves or denies each line item to make sure the fees are fair and reasonable under state regulations. 

If the injured worker doesn’t receive any benefits, the attorney doesn’t get paid. Likewise, if the worker’s benefits stop or are paid in full and there are any unpaid attorney fees remaining, those fees are waived. Under Texas law, a workers’ compensation attorney can’t pursue the client for unpaid legal fees after benefits end.