Exclusive Remedy
Introduction
One of the catalysts for the creation of workers' compensation programs in various states was the flood of litigation against employers generated by workers who had been injured on the job and who blamed their employers for negligence. Employers found to have been negligent could be ordered to pay large awards, including actual damages and punitive damages.
In order to limit the number of such cases, workers' compensation statutes provided a trade-off between workers and employers. That is, a worker would no longer have to sue the employer for damages and take the chance of not being able to prove employer fault. The employer would be responsible for providing automatic coverage for medical expenses and lost wages that were incurred due to on-the-job injury, whether it was the employer's fault, the worker's own fault, a third-party's fault, or a combination of fault. The trade-off in the employer's favor was that this automatic remedy would be the injured worker's only means of recovery, an "exclusive remedy."
Advantages
For the most part, the trade-off between workers and employers is a fair one. A worker who has a valid injury that was clearly incurred in the course of employment is generally compensated for his or her medical expenses and loss of wages in a prompt manner without major complications. He or she is usually provided the means for rehabilitation that helps him or her get back to work in some capacity either at his or her original employer's workplace or somewhere else, sometimes doing the same work, sometimes having been trained to do another type of work. Litigation by workers against their employers for negligence has been dramatically reduced.
Disadvantages
On the other hand, a great deal of new litigation has ensued in the wake of the laws and rules surrounding workers' compensation programs. Employers and workers no longer have to argue about whether either was negligent or not and to what degree. However, both sides have found numerous points of contention: from what is "on the job," to what level disability was sustained, to allegations of fraud and abuse of the system from both sides.
Thus, while workers' compensation agencies have for the most part taken the burden of litigation away from the court system in every state, those workers' compensation agencies are in and of themselves entire bureaucracies dealing with adversarial issues on a daily basis.
Some workers' advocates also contend that while the system works well for less severely injured workers whose claims are small and of short duration, that for more seriously injured workers with long-term disabilities and illnesses, workers' compensation systems fall far short of their original promise. These workers, advocates claim, are often caught in a long-term legal process anyway since the potentially high cost to the employers and insurers creates incentives for them to dispute every issue, prolong the process, and delay having to pay the claim. These advocates believe that the "exclusive remedy" provision fails especially those workers whose injuries were due to the gross negligence and even recklessness of their employers.
Exceptions
There are some exceptions to the "exclusive remedy" rule:
1. No "Quid Pro Quo" Exception
The "no quid pro quo" ("quid pro quo" loosely translates from Latin as "this for that") exception actually is not an exception to the rule. This rule allows workers who would have no other remedy because they are not covered under the workers' compensation act to sue. While not every state has acknowledged this "exception," in some states, workers have successfully argued that the states' workers' compensation systems do not provide them adequate remedies for their on-the-job injuries or illnesses, thus no "quid pro quo" or unfair "quid pro quo." In these cases, the workers were usually allowed to proceed with an action for negligence against the employers.
2. The "Dual Capacity" Exception
In a case in which the employer is not only in the role of employer, but also in the role of manufacturer, the employer may be held liable for injuries caused by the product which it manufactured. This is the "dual capacity" exception. For example: An employee of a company which manufactures a product packaged in an aerosol container who is injured while handling the product may decide to sue the employer in its role as manufacturer under product liability law since the potential for recovery is likely higher than available workers' compensation benefits.
3. Intentional Tort Exception
The most criticism of workers' compensation programs occurs in those cases in which the employer's actions can be categorized as intentional rather than just negligent, grossly negligent, or reckless.
In some states the term "intentional" is defined very strictly. Before the worker would be allowed to pursue a civil lawsuit against the employer, the worker would have to prove that the employer had either the "actual intent" to harm the worker or "desired the harm" to the worker. Very few workers would be able to prove that their employers' behavior rose to this level of intent.
Other states have adopted a broader interpretation of "intentional" so that it includes behaviors by the employer demonstrating that the entity or person acted with "substantial certainty" that the worker would be harmed. For example, in a case in one state, the state supreme court adopted the broader interpretation saying that the employer knew that the removal of a safety device from a machine was "substantially certain" to result in an injury.
Workers' advocates argue that the "actual intent" test for employers' liability provides employers that are highly motivated by monetary gain to knowingly subject workers to injury in order to increase profit because they are immune to all liability except for workers' compensation. In other words, advocates argue, employers motivated by greed may allow the injury of many workers so long as they do not actually "intend" to injure their workers.
Reminder to workers
Workers who do decide to sue their employers and win awards in those lawsuits should remember that they may be required to return any workers' compensation they have received; they will probably not receive any further benefits under workers' compensation for those injuries; and, of course, they will pay contingency fees of 30 percent or so to their attorneys. Thus, injured workers may wish to weigh all the pros and cons of pursuing lawsuits with accepting workers' compensation awards.
Conclusion
Workers' compensation programs for the most part provide the exclusive remedy for workers who have been injured on the job. The "exclusive remedy" rule has provided a trade-off for both employers and workers in that workers generally are provided quicker remedies under the workers' compensation system than they would be in pursuing lawsuits. At the same time, employers are relieved of the burden of having to defend against lawsuits for negligence.
Checklist: Exclusive Remedies: Exceptions?
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Exclusive Remedies: Exceptions?
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