What Are the Most Important Factors Shaping Return to Work? Evidence from Wisconsin

By WCRI

October 1, 1996 Related Topics: Outcomes for Injured Workers, Return to Work

One of the most important functions of workers’ compensations systems for both workers and employers is returning those injured on the job to productive employment in a timely manner. Workers benefit because when return is delayed, workers can lose more than earnings: skills may deteriorate; the job may be filled by a replacement; and future employers may view the worker as a less valuable employee. Employers also benefit from a speedy return to work through lower costs and less disruption of the work force because of additional hiring or reorganization of the remaining workers.

This report quantifies the most important factors that affect return to work. The study, which was based on our analysis of the highly regarded Wisconsin system, concentrated on workers who were away from work at least one month. Although these workers comprised only 52 percent of the workers in the study, they accounted for 98 percent of the time away from work and 94 percent of the income benefits paid.

This WCRI study answers some of the questions about the attributes of injured workers and their employers that affect return to work and describes the longer-term effects of spells off work on the employment of injured workers. Among the key findings:

  • Duration of time off work and periods of subsequent unemployment are lower for injured workers who return to their pre-injury employer than for those who change employers. Most workers with at least one year’s job tenure return to their pre-injury employer, but for those who do not, time off work is lengthened by a factor of two to three.
  • Workers with an intermittent employment history before the injury stay off work longer. In general, about half of injured workers are back at work within 30 days and three quarters by three months. Workers who had one period of unemployment in the year prior to injury took 34 percent longer to return to work than those who did not.
  • Employees at smaller firms are less likely to return to the pre-injury employer (and thereby incur longer periods off work) than those at larger firms. This is a consequence of fewer opportunities for providing modified jobs and the higher cost to smaller companies of holding injured workers’ jobs open for a long period of time.

Employer Size and Return-to-Work Patterns

Number of Employees Percentage of Injured Workers not returning
1-50 21
51-25 16
251-1,000 10
over 1,000 7

Increasing benefits slows return to work by a small amount on average. Prior studies by WCRI and others have found that benefit increases lead to a delayed return to work. This study finds that a 10 percent increase in weekly benefits slows return to work by two days for a two-week injury and by almost a day for a three-month injury. It does not find that a large number of workers find the increase in benefits sufficiently attractive to stay out of work for very long periods. Workers returning to jobs at pre-injury wages go back to work an average of 2.6 days sooner.

The study also examined employment experience after the injured employee returned to work. It found that the duration of time off work has lasting effects on post-injury employment. For workers who returned to work within one month after their injuries, we found unemployment one year later to be about 6 percent. Those who remain off work for 6 months or longer, however, have unemployment rates of 14 percent or more. Thus, policies that promote early return to work have a double benefit for the worker. Not only do they return to full wages sooner, but they also decrease the odds of unemployment after return to work.

What Are the Most Important Factors Shaping Return to Work? Evidence from Wisconsin. Dr. Monica Galizzi and Dr. Leslie I. Boden. October 1996. WC–96–6

Copyright: WCRI

pdf

pdf, 6.7MB

Reports are free for members.

If you are a member, please login here

.

Contact WCRI

We're happy to answer any questions or concerns that you may have. Please let us know how we can help.