Marcia Hultman

Cabinet Secretary

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Workers' Compensation

Employer Rights and Responsibilities

To avoid civil lawsuit, it is our recommendation you carry workers' compensation insurance for your employees. See our Coverage page for more details.

If you suspect that one of your employees is receiving workers' compensation benefits from a previous job or otherwise illegally, you should contact the insurance fraud unit 605.773.6325.

First Report of Injury

Your Insurance Rating

Financial Incentives for Safe Work Sites

Medical Practitioners and Second Opinions

Benefits from the Claim

First Report of Injury

When one of your employees is injured on the job, he or she is required to give you written notice of the injury within three business days, or as soon as practicable.

Having received notice of an injury, you must now complete the First Report of Injury form and submit it to your workers' compensation insurance carrier. You have seven days, excluding Sundays and holidays, to complete the form and send it in.

You may complete the form online using the First Report of Injury Management System, or you may request a form from us or your insurance company. The form asks for detailed information about the:

Employee
Wages and hours worked
Job experience
Injury
How it happened
Part of the body injured
Time of day it occurred
Whether safety equipment was used
Name of the medical practitioner and hospital that treated the injury
Employer
Type of business
Number of employees

We need this detailed information in order to:

Spot trends in work-related injuries
Compare different categories and sizes of employers
Identify areas of increasing costs
Target safety efforts at problem areas

If you fail to report a work-related injury within seven days, you may be charged with a Class 2 misdemeanor and be subject to a $100 civil penalty imposed by the Department of Labor and Regulation.

Even if you don't receive a written notice of injury from your employee within three business days of the injury, you are still responsible for filing the First Report of Injury within seven days of first learning about the injury. Your insurance company, not you, makes the decision on whether the claim is compensable.

Your Insurance Rating

Insurance rating classifications for South Dakota employers are primarily based on South Dakota claims experience. Currently 568 different rating classifications are available.

However, when a particular classification does not generate more than $1 million annually of South Dakota payroll, the class may be combined with the claims experience of other states. This allows the insurance companies to determine a premium that is actuarially sound. In other words, we use the data from other states to help us make sure that the rating reliably predicts the risk of claims being filed.

The Division has examined many of these classifications and found that pooling experience from other states benefits South Dakota employers by reducing some rates, especially in the construction and manufacturing classifications.

Financial Incentives for Safe Work Sites

You could save money on your insurance by participating in one of several plans. Each of these plans rewards you for maintaining a safe work site and making few or no claims for work-related injuries.

Merit Rating Plan - This plan is designed for small employers who are not currently experience rated or pay a premium less than $3,750 per year. It provides you with insurance premium discounts up to 10 percent based on your immediate past three years claims experience. This plan is applicable to both voluntary and assigned risk policies.

Experience Rated Plan - This plan is designed for larger employers who pay more than $3,750 per year in premiums. This plan is specific to your individual experience. Premiums may be credited or debited based on past claims and the cost of those claims. It is also applicable to both voluntary and assigned risk policies.

Scheduled Rating Plan - This plan is designed for experience-rated employers insured in the voluntary insurance market. It provides for premium discounts of up to 24 percent based on your willingness to participate in a safety plan prescribed by your insurance company. Insurers are not required to offer this plan, so you may need to shop around to find a company that does. There are more than 200 insurance companies providing coverage in the voluntary insurance market in South Dakota.

Medical Practitioners and Second Opinions

Your employee has the right to make the first choice of medical practitioner. Emergency room treatment does not count as this choice. However, your employee must notify you of the choice prior to treatment or as soon as reasonably possible after treatment. If your employee wants to change medical practitioners later, they must get written permission from you or your insurance company.

You and your insurer have the right to get a second opinion about the injury treatment. However, this is at your expense. The same is true for your employee, who will have to bear the cost of any second opinion they obtain.

Benefits from the Claim

You (via your insurance company) must furnish necessary first aid, medical, surgical and hospital services, including prosthetic devices, body aids and physical rehabilitation.

If your employee is unable to work because of a work-related injury for a period of at least seven consecutive calendar days, he or she is entitled to temporary total disability benefits. The benefit is computed at two-thirds of the employee's average weekly wage (limiting overtime earnings to straight-time pay) up to a state maximum of $705 per week. The benefits continue until the employee is released by the medical practitioner to return to work in a full or partial capacity or until it is determined that the employee's condition has reached a point of maximum medical improvement.

In certain instances, travel, lodging and meal costs from obtaining necessary medical treatment may be reimbursed by the insurer.

Returning to Work

If the medical practitioner says your employee can return to work for part-time or modified work and you can accommodate the restrictions, state law requires the employee to accept the employment. If he or she refuses to accept light-duty work, your employee risks the loss of some or all of his or her workers' compensation benefits.

If your employee is released to part-time or modified work and is earning less than what he or she was earning at the time of the injury, the employee may be entitled to temporary partial disability benefits. Temporary partial disability benefits are calculated as half the difference between the average amount the employee was earning before the injury and the average amount the employee is earning or is able to earn in some suitable employment after the injury.

The total compensation for earnings and workers' compensation benefits may not be less than the amount received for temporary total disability, unless the employee refuses suitable employment.

If you are unable to accommodate an employee's light-duty restrictions and do not offer work to the employee, he or she will still receive temporary partial disability benefits, but at a rate equal to the amount received for temporary total disability.

Permanent Disability

If an injury or illness results in permanent impairment, an employee may be entitled to permanent partial disability benefits. These benefits are computed by a formula using the impairment rating assigned by the medical practitioner, the compensation rate and a set of regulations provided by state law.

If an employee is unable to return to his or her usual and customary line of employment, and retraining is necessary to restore the employee to suitable and gainful employment, the employee can file a claim with you and your insurer requesting the benefits.

Survivor Benefits

If a work-related injury causes death, compensation is payable to the employee's spouse at the rate of 66.67 percent of the employee's average weekly wage (excluding overtime earnings). If the spouse remarries, a lump sum equal to two years of compensation will be paid. If there are eligible surviving children of the employee, the compensation becomes payable to them two years after the date of remarriage.

If the only survivors are children, the child or children receive compensation at the rate of 66.67 percent of the average weekly wage of the employee until age 18 (or age 22 if a full-time student). If a child is physically or mentally incapable of self-support, benefits will be paid for the life of the child.

An additional $50 per month must be paid to each legally dependent child of the deceased employee from the date of the employee's death until that child reaches the age of 18 years. A deceased employees dependents are each also entitled to $2,000 a year for up to five years if they are enrolled full-time at an accredited post-secondary educational institution in South Dakota.

Workers' compensation also provides up to $10,000 in burial expenses, plus the cost of transporting the body if death occurs outside the community where the employee is to be buried.

Disputing a Claim

If you and your employee cannot agree about the validity of the claim, either of you may ask the Division of Labor and Management to mediate. This is usually a conference call between you (and your insurance representative), the employee (and possibly his or her representative) and the division staff member who acts as mediator.

If the mediation is unsuccessful or if the employee will not participate in mediation, the employee may file a petition for hearing. He or she has two years from the date benefits were denied to file this petition.

If the case moves to a hearing, the case will be heard by an administrative law judge in a formal, adversarial proceeding similar to a trial. Representation by an attorney is not required in a workers' compensation hearing, but is strongly recommended.

The Division of Labor and Management may provide information, answer questions and assist persons on a limited basis. However, because we are the administrative agency that decides all disputed cases, we must remain impartial. The Division of Labor and Management cannot and does not represent any party.

Possible Fraud

Even if you suspect that an injury is not work-related, you must still file the First Report of Injury form with your insurance carrier within seven days. If you have reason to believe that a workers' compensation claim is not valid, you should provide information to your insurance carrier so they can investigate the claim accordingly.

If you suspect that one of your employees is receiving workers' compensation benefits from a previous job or otherwise illegally, you should contact the insurance fraud unit (605.773.3563). If the employee was working for another employer when he or she was injured, you should contact that employer.

Retaliation

You are not allowed to fire an employee because he or she filed a workers' compensation claim.

Disclaimer

The information provided on this page should in no way be considered legal advice. For specific information about your legal rights, you should consult your personal attorney. If you have a general question, contact us.