What is typically a consequence of not handling a workers’ compensation claim in good faith?

When a workers' compensation claim is not handled in good faith, one significant consequence can be increased legal liability for the employer. Good faith claims handling implies that the employer is transparent, honest, and fair when addressing claims from injured employees. Failing to do so can lead to various legal repercussions.

If an employee feels that their claim is not being handled fairly, they may seek legal recourse. This could result in costly litigation and potential penalties for the employer, including fines and increased costs associated with longer-term claim resolutions. Furthermore, a negative claims handling experience can lead to reputational damage, resulting in trust issues between the employer and employees, potentially affecting workplace dynamics and increasing the likelihood of disputes.

In contrast, improved relationships with employees, higher employee morale, and reduced insurance costs are outcomes more likely to arise from effective and good faith claims handling rather than a consequence of poor handling.