Is It Illegal To Work While on Workers’ Compensation?
By Canaan Suitt, J.D. | Last updated on June 26, 2025 Featuring practical insights from contributing attorney Alfred J. CarlsonSome workplace injuries happen immediately. Others, such as occupational diseases, develop over a longer period of time. “Being involved in a work-related accident can be a life-altering event for an injured worker,” says Alfred J. Carlson, a workers’ compensation attorney at Martin Law in Philadelphia, Pennsylvania.
Workers’ compensation covers injured employees’ expenses, such as medical bills and lost wages. Employees recovering from workplace injuries often want a second job to supplement their workers’ comp payments. Can you do this?
The answer depends on several factors and is very fact-specific. But in general, the point of workers’ comp is to compensate you for lost wages resulting from your workplace injuries. If you return to work, you get wages directly and no longer need workers’ comp. As a result, you generally can’t start working a second job and receive workers’ comp. However, there are some exceptions— for example, if you were already working a second job before your injury.
This article will cover the nuances of working a second job while getting workers’ comp. The crucial thing is to report any changes to your employer and workers’ compensation insurance carrier. If you get a second job while collecting workers’ compensation and don’t tell your employer, that could constitute workers’ compensation fraud and result in fines or even jail time. For legal help, reach out to a workers’ comp lawyer.
How Does Workers’ Compensation Work?
Every state has a system that regulates workers’ comp insurance for possible workplace injuries. State laws governing how workers’ compensation payments are calculated and paid vary.
Regardless of the state compensation program, workers’ comp benefits generally cover medical treatment and wage loss due to workplace injury. Depending on the type of work, workers’ comp can also cover the costs of retraining needed for an employee to return to work after an absence.
In most states, medical expenses are covered without a cap on the cost. Workers’ comp payments for lost wages are generally calculated based on your average weekly wages before the workplace injury. In many states, workers’ comp payments equal two-thirds (65 percent) of your average earnings, though the amount is higher in some states. Though it’s lower than your actual earnings, workers’ comp is not taxable.
Because these laws can be complicated, it’s a good idea to speak with a workers’ comp attorney in your area as soon as possible to ensure the best outcome in your case.
Is It Illegal to Work Another Job While on Workers’ Compensation?
“The answer to this question will potentially vary from state to state,” says Carlson. One of the key questions is whether you had a second job before getting injured or if you got a second job after your injury.
Scenario 1: You Already Had a Second Job
“Say you were working two jobs at the time of your work injury. You are injured in one job and it prevents you from working that job and your second job,” says Carlson. “You could still work one of those jobs and be entitled to workers’ compensation benefits, but workers’ comp insurance will pay you less money since you’re getting some of your wages again.”
For example, say your primary job is in the construction industry. This is the job where you got injured. You also already had a second part-time job as a cashier at a local clothing store. Generally, workers’ comp would cover lost wages from both the construction job and the cashier job, since you can’t work either one due to your injuries.
Maybe you’re able to return to your part-time job in the clothing store sooner since it’s less strenuous. In that case, your workers’ comp payments will likely need to be adjusted since you’re getting wages from the second job again. The portion of workers’ comp that covered the second job is no longer needed.
Say you were working two jobs at the time of your work injury. You are injured in one job and it prevents you from working that job and your second job. You could still work one of those jobs and be entitled to workers’ compensation benefits, but workers’ comp insurance will pay you less money since you’re getting some of your wages again.
Scenario 2: You Get a Second Job After Your Injury
“Say you were only working one job at the time of your work injury. You were disabled from that job but later went back to work at a new job. In this case, you would have to let your former employer and workers’ compensation insurance company know as soon as possible,” says Carlson.
When do you have to notify your employer of changes? “Certainly by the time you’ve received your first paycheck from the new job,” says Carlson. “The employer needs to know so that they can either suspend or modify your workers’ compensation benefits going forward. To return to work at a new employer after a work-related injury and not let the insurance carrier know could definitely be considered insurance fraud.”
In some states, workers’ compensation laws allow injured workers to return to “light duty work” while receiving full workers’ comp. Still, informing your employer of any changes is imperative to avoid fraud or other legal trouble. If you have questions about your state laws and whether you can return to work, speak with a workers’ comp attorney in your area.
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