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The Impact of Income Sources on Financial Stress in Workers’ Compensation Claimants

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Abstract

Purpose

Workers’ compensation schemes usually recompense workers below their regular wage. This may cause financial stress, which has previously been associated with poorer health and work outcomes after injury. We sought to determine the level of financial stress experienced by injured workers and the influence of post-injury income source on financial stress.

Methods

Analysis of a cross-sectional national survey of 4532 adults who had been injured at work and had at least one day of workers’ compensation paid. Financial stress at time of survey was measured on a scale of 1–10 and subsequently dichotomised at the top quartile for further analysis. The effect of current main income source on financial stress, adjusted for demographic and psychosocial confounders, was assessed using logistic regression.

Results

Sixty-nine percent of workers whose main income was social assistance or insurance and 54% whose main income was workers’ compensation were experiencing financial stress. Relative to wages or salaries, workers with a main income from social assistance or insurance (odds ratio: 3.33, 95% CI 2.22–5.00) and workers’ compensation (1.71, 1.31–2.24) had higher odds of financial stress. Workers with a main income of an aged pension or superannuation had lower odds of financial stress (0.52, 0.28–0.97).

Conclusion

Injured workers receiving workers’ compensation or social assistance benefits are vulnerable to increased financial stress. Given the potential negative consequences of financial stress on health, particularly mental health, this study suggests the need for careful consideration of income replacement benefits in the design of workers’ compensation schemes.

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Data Availability

The data that support the findings of this study are available from Safe Work Australia but restrictions apply to the availability of these data, which were used under license for the current study, and so are not publicly available. Data are however available from the authors upon reasonable request and with permission of Safe Work Australia and the Australian state, territory and Commonwealth workers compensation regulatory authorities.

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Acknowledgements

This study was funded by a grant from the Australian Research Council (DP190102473). This publication uses data supplied by Safe Work Australia that was compiled in collaboration with state, territory and Commonwealth workers’ compensation regulators. The views expressed are the authors and are not necessarily the views of Safe Work Australia or the state, territory and Commonwealth workers’ compensation regulators. The authors would like to acknowledge the contribution of Ms Dianne Beck for assistance with data management.

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Authors and Affiliations

  1. Insurance Work and Health Group, School of Public Health and Preventive Medicine, Monash University, 553 St Kilda Road, Melbourne, VIC, 3004, Australia

    Luke R. Sheehan, Tyler J. Lane & Alex Collie

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  1. Luke R. Sheehan
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  2. Tyler J. Lane
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  3. Alex Collie
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Correspondence to Luke R. Sheehan.

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Conflict of interest

Luke R. Sheehan, Tyler J. Lane and Alex Collie declare that they have no conflicts of interest.

Ethical Approval

All procedures performed in studies involving human participants were in accordance with the ethical standards of the institutional and/or national research committee (Monash University Human Research Ethics Committee approval reference number CF14/2995-2014001663) and with the 1964 Helsinki declaration and its later amendments or comparable ethical standards. This article does not contain any studies with animals performed by any of the authors.

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Informed consent was obtained from all individuals participants included in the study.

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Sheehan, L.R., Lane, T.J. & Collie, A. The Impact of Income Sources on Financial Stress in Workers’ Compensation Claimants. J Occup Rehabil 30, 679–688 (2020). https://doi.org/10.1007/s10926-020-09883-1

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