Friday, May 6, 2016

Worker’s Compensation Does Not Eliminate the Possibility of a Third Party Tort Claim

Originally published by Kyle White.

Workers Comp

In explaining potential exposure to a number of our clients, we have seen a recurring misconception that has led them to believe that they have minimal or no exposure – that because the injured individual has received worker’s compensation benefits, the injured individual has no claim against any third parties. In South Carolina, it is generally true that the injured individual cannot maintain a lawsuit against his or her employer for an on-the-job injury if the employer maintains worker’s compensation insurance; however, this does not prevent the injured individual from filing a third party tort claim against someone or some entity that is not his or her employer.  Consider the following hypothetical:

Jim Jones is injured while operating a forklift at a manufacturing facility at which he is employed, and he becomes seriously injured.  He goes to see a lawyer.  The lawyer determines that Jones’ employer maintains worker’s compensation insurance and that Jones was injured in the course and scope of his duties.  The lawyer also determines that he can make the argument that the forklift was defective, and that the forklift defect caused Jones’ injuries.

In the scenario above, Jones can maintain a worker’s compensation claim against his employer.  He can also file a lawsuit against the manufacturer of the forklift. The amount of recovery in the worker’s compensation claim is unaffected by the tort lawsuit; however the worker’s compensation insurance carrier will have a lien against anything that Jones recovers against the forklift operator. In the lawsuit against the forklift operator, no evidence regarding the amounts recovered in the worker’s compensation claim is admissible at trial. Consider the following recovery scenario under our hypothetical above:

Jones recovers $30,000.00 in his worker’s compensation claim. His lawsuit against the forklift manufacturer then goes to trial and the jury awards $60,000.00.

Under the scenario above (without taking into consideration any negotiation of the lien or attorney’s fees), the worker’s compensation insurance carrier would take $30,000.00 of the $60,000.00 awarded by the jury to satisfy its lien, and the $30,000.00 balance would go to Jones. So, the forklift manufacturer is still responsible for paying $60,000.00, but half of the money goes from Jones to his worker’s compensation insurance carrier.

Hopefully this helps to shed light on the interplay between worker’s comp claims and third party tort claims arising out of the same incident. Obviously, this is an extremely oversimplified explanation and there are many other variables and nuances to consider in the real world. But that’s why we are here!

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.

from Texas Bar Today
via Abogado Aly Website

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