It is singled out by the National Council on Compensation Insurance as one of the top legal issues to watch, and disputes over exclusive remedies in workers’ compensation will continue as more injured workers and surviving families sue employers, experts say.
In nearly all states, workers’ compensation is considered the exclusive remedy for workplace injuries. The so-called grand bargain ensures that workers’ injuries are dealt with and that they receive income benefits or that families receive death benefits in the event of a workplace death. In return, the workers largely waive their right to claim damages.
But many states also include a loophole: If an employer is judged by the courts to have been grossly negligent, it can be subject to litigation for damages. At least one state — Mississippi — introduced legislation this year that clears the red tape for such lawsuits.
“Court challenges to the constitutionality and scope of the exclusive remedy—providing employer immunity from tort suits for injured employees—continue to be a closely watched topic among WC stakeholders,”
; said Adam Levell, NCCI’s senior counsel in Boca Raton, Florida.NCCI tracked several cases in 2022 and named exclusive remedies among the top five legal challenges in comp. The cases it highlighted in its February report showed mixed results.
Many of the arguments concerned the interpretation of the language of the statute.
For example, the Supreme Court of Idaho, i Fulfer v. Sorrento Lactalis Inc.reversed an earlier summary judgment on the basis that exclusive remedy “does not apply when the employee’s injury is caused by the employer’s intentional or unprovoked physical aggression,” according to NCCI’s analysis.
As an example that affirmed the exclusive remedy, the Supreme Court of South Dakota, i Althoff v. Pro-Tec Roofing Inc.held that a family could not sue an employer, and clarified “the intentional tort exception to the exclusive remedy of workers’ compensation, finding that employees suing their employers for work-related injuries under the intentional tort exception must prove that it was substantially certain—and not practically certain – that their injuries would arise as a result of the employer’s conduct,” NCCI reported.
“It’s a very, very active plaintiffs’ bar,” said Nathan Levy, an Atlanta-based partner with Levy, Sibley, Foreman & Speir LLC, who added that in Georgia, exclusive jurisdiction has been upheld in most cases at the appellate and state supreme court levels . . “Exclusive remedy has really remained intact; it hasn’t been scaled back, and that’s largely a good thing.”
Still, such proceedings are likely to continue, he added.
Bert Randall, a principal at Franklin & Prokopik PC in Baltimore, said several issues are driving the lawsuits.
“What I think we’re seeing in some cases around the country is opportunities for plaintiffs’ attorneys in the right cases to try to remove exclusive remedies and pursue a tort action,” he said.
“One of the reasons is the nuclear verdicts that we’re seeing almost daily in different parts of the country. And I think the plaintiffs’ attorneys are looking at some cases where it might be worth fighting and taking the chance to bypass exclusive remedies.”
Active occupational health and safety management may also be a contributing factor, he said.
Under the Biden Administration, OSHA, which investigates serious and fatal workplace incidents, has become increasingly aggressive, legal experts say. If the agency fines an employer after an incident — regardless of whether a citation is contested — that could be the impetus for a lawsuit alleging negligence on behalf of the employer, Randall said.
“If there’s evidence of an OSHA violation, that would mean their chances of recovering on a negligence theory would likely increase; perhaps significantly higher, he said. “If they feel they have a pretty strong case on the negligence side, then is the next question, ‘okay, can we pierce the exclusivity provisions of this state statute to get to the negligence needed in a case where Damages are sufficient to make it worthwhile?’”
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