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

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.