Exclusive remedy doctrine in workers’ comp has been under attack for years, and those attacks just keep getting more successful and more costly and there seems to be no end in sight, says Mark Walls, vice president of communications and strategic analysis at Safety National.
“Exclusive remedy has been evolving in the courts for years. As long as you have exclusive remedy, attorneys will try to find a way around it, find a way to sue,” says Walls.
He says the exception for intentional acts for instance is a common way to the courts for attorneys and their clients, as are claims that injuries suffered in assaults, for instance, were not suffered within the scope of work and thus may be eligible for redress in the courts.
“In the past, most claims were quickly dismissed by the courts, but lately more and more claims are making it into court and once that happens, even if a company wins, they may face 6-figure legal fees,” Walls says.
Among the types of cases recently allowed into court, he says are one where a father saw his son killed in the workplace. “Assaults, and occupational diseases are the types of cases that the courts have agreed to hear lately. There are big issues here related to potential coverage. If the allegation is intentional injury, you can’t insure that. If you are hit with that, you don’t have insurance.
“In theory, there is a very high burden of proof—you had to know people would be hurt because of your actions, but the courts are starting to say, ‘well, you should have known’ and that is a lower standard than you did know. Courts have said that if you should have known and you did nothing, then that constitutes intent, and that is a big step.
“There was a case where a worker was attacked at work by a temporary employee. The attack had nothing to do with the job but that is where it occurred. Now, workers’ comp would cover this injury, but the worker’s attorney says this attack had nothing to do with the job, the attack did not happen within the scope of employment so workers’ comp rules don’t apply and they should be able to sue the employer and open the door to a big jury award. When attorneys see the potential of a good case, they are going to go for it.”
He says another area of evolving law is around the definition of “independent contractor.” “This has been a big issue for a very long time. When you talk about workers’ comp fraud, the number one issue is not faked injuries; it is payroll fraud, committed by employers who call people contractors when they are really employees. This has been prevalent in construction and trucking, among other industries—calling people independent contractors when they are really employees.
“Everybody is talking about Uber and the on-demand economy. Are the drivers employees of Uber or are they independent contractors? Does it make sense to call them one thing in one state and something else in another? People doing the same job in different states should be treated the same.”
Walls says the Department of Labor has already sent a memo to the effect that DOL thinks most contractors are really employees, and he expects that more serious actions on this matter are not far behind.
