If you were involved in an accident at work and you filed a successful personal injury claim against your employer, you may be wondering if having been awarded a lump sum in compensation it would affect your future entitlement to receive means tested state benefits that you currently get. The answer is that your income or housing support benefits may well be affected if you are awarded personal injury compensation, to find out more please read on.
In What Circumstances Can I File a Personal Injury Claim Against My Employer?
All employees are entitled to seek compensation for injuries or harm they were subjected to in the workplace whether the damage sustained in physical or psychological. However, your claim would need to meet specific criteria which is as follows:
- That the accident at work occurred in the last 3 years
- The incident and the injuries you sustained were caused through no fault of your own
However, it is worth noting that even if you were partly responsible for the accident at work, your employer may still be held liable for the injuries you sustained. As such, it is best to seek legal advice from a personal injury lawyer who would determine your employer’s level of responsible as well as your own.
How Is Personal Injury Compensation Calculated?
Personal injury claims are calculated in two parts, but the amount of compensation you may receive would be based on the extent of the injuries you sustained in the workplace. As such, the amount of personal injury compensation you may be awarded would be based on the following:
- How your injuries would impact your future life
- If your ability to work again is affected
- Future prognosis
- All the expenses and costs you incurred as a result of having sustained an injury in the workplace
Should you have been awarded a lump sum in a successful personal injury claim, you may find that it could affect your state benefits which not only includes the amount you may be able to claim, but also the benefits you may be entitled to receive.
How Would Personal Injury Compensation Affect My State Benefits?
When calculating “means assessed” state benefits, your income, savings as well as any assets you may own would be taken into account. This would determine whether you would be able to claim them. This is referred to as being your “capital”. The amount you are awarded in a personal injury claim would be added to your “capital” and if this exceeds the specific financial thresholds, it could affect the amount of state benefits you would be entitled to claim.
When assessing a person’s eligibility to claim state benefits, the first £6,000 of your “capital” is disregarded. Should the amount of compensation you are awarded be low and as such does not take you over the limit of £6,000, your eligibility would not be affected.
However, should you receive more in the way of personal injury compensation in a successful claim and as a result, it takes you over the £6,000 threshold, your state benefits would be reduced as follows:
- For every £250 over the £6,000 threshold, the amount you would be entitled to claim in state benefits would be reduced by £1 per week
Should your “capital” be over £16,000 you would not be able to claim state benefits which would be suspended until such time as your capital falls below £16,000. Once this happens, you would be entitled to make a new application to receive state benefits.
Are State Benefits I Receive as a Result of My Injuries Affected By Personal Injury Compensation?
If you were diagnosed as suffering from a work-related medical condition/disease and as a result you receive state benefits as a direct result, the amount you get could be deducted from the final personal injury settlement you receive. The money that is deducted would be paid by way of reimbursement to the government. Payments that would be included are as follows:
- The Diffuse Mesothelioma Scheme
- The Pneumoconiosis etc (Workers Compensation) Act 1979
What Benefits would be Affected if I Receive Accident at Work Compensation?
As previously mentioned, the means tested benefits you receive could be affected and reduced accordingly if you are awarded personal injury compensation and includes the following:
- Income Support
- Universal Credit
- Income-related Employment and Support Allowance
- Income-based Jobseeker’s Allowance
- Housing Benefit
- Council Tax Support
- Pension Credit
With this said, some benefits you may receive would not be affected by the fact you are awarded personal injury compensation for an injury sustained at work and this includes the following:
- Incapacity benefit
- Disability living allowance
Would Anything Else be Affected If I Am Awarded Accident at Work Compensation?
If you are awarded a lump sum in a successful accident at work claim, there are other things that may be affected and this includes the following:
- Your entitlement to receiving free prescriptions
- Your entitlement to free dental treatment
- Your entitlement to free eye tests
- Working Tax Credit
- Child Tax Credit
It is also worth noting that having been awarded a lump sum in compensation for an injury you sustained in the workplace, it could also have an impact on how much you are allowed to receive towards home care.
Who Gets Notified if I File a Personal Injury Claim?
When you file an accident at work claim to seek compensation for an injury you sustained, your employer’s insurance provider would inform the Department for Work and Pensions (DWP) and the insurer would also inform the DWP should you receive any interim payments until a final settlement is reached.
However, it is up to you to inform the benefits agency of any changes in your financial circumstances. Should you fail to let them know, you run the risk of being accused of fraud.
What Can I Do To Prevent Losing My State Benefits if I Receive Personal Injury Compensation?
If you are awarded a lump sum in a successful accident at work claim, the best course of action is to have a specialist solicitor set up a “personal injury trust” for you which would mitigate any risk that the amount you receive in compensation would affect any benefits you receive.
A personal injury trust is as follows:
- The trust is managed by 2 or more trustees and you have the option to be one of them
- The “trust account” is independent of your existing bank account
- Any money that is held in “trust” is held apart from any of your other assets
- You can only pay the amount of accident at work compensation you receive into the trust account which would be taxed like other savings you may have
- You are allowed to withdraw funds from the “trust” account, but it is important that any amounts you draw do not take you over the “savings” limit
- Any money that is held in your “trust” account is safeguarded from any care costs should you need residential or social care
Setting up a trust allows you to receive a lump sum in accident at work compensation straight away, but the amount must not take you over the capital limits. You can invest the rest. The money that you invest would not be factored into whether you would be eligible to receive state benefits. You are also allowed to withdraw a small amount from your trust every year should you need to cover certain expenses.
Should I Ask a Solicitor to Set up a Personal Injury Trust For Me?
If you think you may have to claim benefits in the future or you currently receive state benefits, the best course of action if you are going to receive a lump sum in accident at work compensation would be to ask an experience solicitor to set up a personal injury trust for you especially if the amount you receive is substantial. It is worth noting you can file an accident at work claim and be awarded compensation before deciding to set up a personal injury trust account.
Are There Any Other Benefits to Setting Up a Personal Injury Trust?
Another advantage of setting up a personal injury trust is that it would protect your accident at work compensation from a third party claiming any of it. An example being should you go through a divorce, the money that is held in your trust would be ring fenced and would therefore not be factored into a final divorce settlement
What is the 52 Week Period of Grace For Accident at Work Compensation?
Whether you receive a final personal injury compensation settlement or an interim payment, you would have 52 weeks’ grace before the lump sum you are awarded would be included in your benefits entitlement. This would allow you the time to set up a personal injury trust without the worry of a lump sum received in compensation affecting any means tested and other benefits you currently receive.
It is worth noting that should you spend any money that you receive in compensation within the 52 week period, your expenditure would come under scrutiny. You may find that you would be penalised if it is found that you spent the money quickly to reduce the risk of a lump sum negatively impacting the state benefits you receive.
Should you decide to spend your compensation after the 52 week period expires and you are still claiming benefits, it could be deemed to be a “deprivation of capital”. In short, a benefits agency may see your actions as a way of reducing your capital so that it falls within the benefits entitlement limit and that you did so deliberately. As such you may end up being penalised for your actions.
You must always be honest about your circumstances bearing in mind that government departments would be notified of the amount of compensation you may be awarded in a successful accident at work claim and this includes when you are in receipt of any interim payments.
What Can I Include in an Accident at Work Claim?
The way compensation is calculated in accident at work claims is as follows:
- General damages are awarded for the pain, suffering and loss amenities you suffered as a direct result of having been injured in the workplace through no fault of your own
- Special damages are awarded for all the out of pocket expenses and other costs incurred because you suffered a workplace injury
Should I Sue My Employer If I Am Injured in An Accident at Work?
Employers in the UK have a legal responsibility to keep you safe while you are in their employment. If an employer fails in their “duty” and you suffer an injury in an accident at work that occurred through no fault of your own, your employer could be deemed liable for the injuries you sustained. As such, you have the right to seek compensation for the pain, suffering and loss of amenity you had to endure by filing an accident at work claim.
Employers are required to have liability insurance in place which is a legal requirement. The policy covers accidents in the workplace that result in employees and other people being injured. The policy must be issued by a recognised liability insurance provider and it must meet the legal requirement of £5 million.
When you file an accident at work claim against your employer because you suffered an injury, it is the liability insurance provider who deals with your claim and who pays out the accident at work compensation you are awarded. It is also worth noting that 95% of personal injury claims are settled before they go to court with insurance providers choosing to settle claims before case go before a judge.
Is There a Time Limit to Making an Accident at Work Claim for Compensation?
You must abide by the strict 3 year time limit that applies to all personal injury claims for your case to be valid. With this said, there are exceptions which are detailed below:
- The time limit of 3 years begins from the day you are diagnosed as suffering from a work-related medical condition that can be linked to the accident you suffered
- Should you have sustained your injuries in the workplace before you were 18 years old, the 3 year time limit starts from the day you are 18 years of age
Do I Have Workers Rights Following an Accident at Work?
As previously mentioned, your worker’s rights are protected and this also applies should you be injured in an accident in the workplace. You have the “right” to the following:
- Seek compensation from your employer providing your claim meets specific criteria
- To file an accident at work claim without having to worry about losing your job or being treated badly
If your employer objects, you should contact an solicitor who specialises in employment law because you could be entitled to sue your employer for acting unlawfully.
What Are My Employer’s Responsibilities Towards Me in the Workplace?
Your employer must ensure that you are kept safe in the workplace which is a legal requirement that must be adhered to. Employers must follow and abide by all regulations, laws and legislation that is set in place by enforcing authorities and the Health and Safety Executive. Your employer’s responsibilities towards you are as follows:
- That you are provided with adequate and ongoing training so that you can safely carry out the jobs you are tasked to do in the workplace
- That all equipment, machinery and tools that you use are in good working order and correctly maintained to reduce the risk of you injuring or harming yourself while carrying out a job
- To carry out risk assessments on an ongoing basis to identify hazards you may encounter and to set in place reasonable measures to reduce the risk of you harming yourself
- To ensure you are given detailed working procedures before carrying out jobs
- To ensure that you are given the correct personal protective equipment (PPE) and that it is correctly stored, maintained and replaced when necessary
Are There Any Benefits to Working With a Solicitor on an Accident at Work Claim?
Working with a specialist accident at work lawyer when filing a personal injury claim against a negligent employer offers many advantages and benefits, some of which are listed below:
- You would be offered an initial consultation whether this is over the phone or in a meeting at the solicitor’s offices which is typically free of charge
- If a personal injury lawyer is happy that you have a strong claim against an employer who could be held liable for the injuries you sustained in the workplace, they would offer to represent you on a No Win No Fee basis. In short, you would not have to pay the solicitor any upfront fees or ongoing fees as your claim progresses
- An accident at work solicitor has access to legal libraries which can be referenced when representing your claim
- A solicitor would ensure that you are examined by a specialist consultant who would provide a detailed medical report on the injuries sustained at work. This report is crucial evidence that would form the basis of the compensation you would receive in a successful personal injury claim against your employer
- A specialist lawyer with years of experience in handling accident at work claims, would ensure that all pre-action protocols and personal injury time limits are respected
- A solicitor would ensure that you receive the correct level of compensation
- A solicitor has the necessary experience to ensure you receive interim payments
- A solicitor would arrange ongoing treatment should your injuries be severe and therefore you require long-term therapy
Can My Employer Fire Me For Filing a Personal Injury Claim?
Worker’s rights are protected and this includes your right to claim compensation for injuries sustained in the workplace. As such, your employer cannot sack you, make you redundant, treat you detrimentally or unfairly because you file an accident at work claim against them. If your employer does act this way or tries to fire you, they would be acting unlawfully and you should contact a solicitor who specialises in employment law because you could sue your employer.
Would a Solicitor Work on a No Win No Fee Basis on My Accident at Work Claim?
Providing a solicitor is happy that your claim against an employer is valid and that you have a strong chance of winning personal injury compensation, they would agree to represent you without the need of asking for a retainer or upfront fee. There would no ongoing fees to find as your accident at work claim progresses either.
No Win No Fee agreements take away the need for you to find the funds to pay for legal representation and you would only have to pay the “success fee” that is laid out in the Conditional Fee Agreement when you are awarded accident at work compensation. The other thing to bear in mind is that the agreed percentage is taken from the amount you receive which in short means you would not have to find the funds to pay the success fee either which is just one of the benefits of having a solicitor work with you on an accident at work claim.
To find out more about how a lump sump received in personal injury compensation may affect your benefits entitlement, please follow the link below:
If you would like to know more about setting up a personal injury trust, please click on the link below: