What is the purpose of Workers' Compensation?

• A. It provides subsistence pay for unemployed workers seeking jobs, provided they were not let go for cause.
• B. It allows seasonal workers to survive while laid off from temporary employment.
• C. It is an insurance system for employers to cover guests who are injured through employee negligence.
• D. It covers medical costs and lost wages for employees who have been injured at work.

Answer: (D)

Workers' compensation is a no-fault system that provides benefits directly to employees who are injured on the job. Its purpose is to ensure medical treatment and wage replacement so workers can recover without needing to sue their employer, while also limiting employer liability. Benefits typically cover medical costs and a portion of lost wages, and may include rehabilitation or survivor benefits. This mechanism helps keep workplace claims predictable and allows HR to manage claims efficiently, ensure timely care, and maintain a safer work environment.