Workers' compensation is a legal and insurance-based system that provides financial and medical benefits to employees who are injured or become ill in the course of their employment. It is designed to protect both employees and employers by ensuring that workers receive the necessary support and medical care while employers are protected from potential lawsuits related to workplace injuries.

Example
If an employee, while performing their job, suffers a back injury from lifting a heavy object, workers' compensation would cover their medical expenses, rehabilitation, and potentially a portion of their lost wages during the recovery period. This system prevents the need for the employee to sue their employer for negligence, as the compensation is typically provided through an insurance policy or state-managed fund.