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Court: No Workers’ Comp Lien for Pain and Suffering

Employees who are injured on-the-job are entitled to workers’ compensation benefits. These include a portion of lost wages, plus coverage of all reasonable and related medical bills.worker3

As a general rule, employees can’t collect damages for pain and suffering, loss of life enjoyment or loss of consortium, and they can’t sue their employer on top of receiving workers’ compensation benefits. However, they can pursue third-party litigation against others whose negligence caused or contributed to the severity of their injuries.

In third-party liability claims, workers are entitled to collect these other non-economic damages – and maybe even punitive damages, depending on the circumstances.

Still, employees should know that some of the damages they collect will be subject to the workers’ compensation insurance company’s lien. The idea is workers can’t be paid twice for benefits. So if an insurance company has paid for medical benefits and lost wages, a worker doesn’t get to collect that a second time from a third party. BUT – neither is that third-party off-the-hook. This is where the employer’s insurance company can collect what it previously paid out.

Now, this raises questions about the extent of the lien the employer insurance company can assert. Some will argue they are entitled to a portion of all damages. Atlanta workers’ compensation lawyers will argue insurers are only entitled to liens on the portion of damages they previously paid – limited to lost wages and medical bills.

There have been some mixed results in court. Most recently, the issue was weighed by the Massachusetts Supreme Judicial Court, which combined two different cases with very similar circumstances in which lower courts ruled differently.

In the first case, DiCarlo v. Suffolk Construction Inc., worker suffered a serious injury to his back while working as an electrician on a construction site. This resulted in severe and ongoing physical and emotional suffering. He was awarded a total of $281,000 in workers’ compensation benefits. He then filed a third-party personal injury lawsuit against the construction site owner and contract manager. A settlement was reached for $100,000 — 35 percent of which was for pain and suffering and not subject to the workers’ comp lien. Lower court judge declined to approve it, finding workers’ comp insurer was entitled to a lien on the full amount. Plaintiff appealed.

Then in Martin v. Angelini Plastering, another construction site electrician was injured and awarded $566,000 in workers’ compensation benefits. He also suffered ongoing physical pain and mental anguish and sued the general contractor and subcontractor. A settlement for $1 million was approved by the court, with the stipulation 35 percent would not be touched by workers’ compensation insurance lien. Insurer appealed.

Both cases were combined for argument before the Massachusetts Supreme Judicial Court.

Employees urged that as far as subrogation was concerned, employers/insurers were only entitled to collect damages awarded for injuries that are compensable under workers’ comp law. Employers fought for a broader interpretation.

The court sided with employees, finding employers and insurers couldn’t seize portions of the compensation for which they had not paid and which was not even payable under workers’ compensation law.

For information on Atlanta work injury compensation, contact J. Franklin Burns, P.C., at 1-404-303-7770.

Additional Resources:

DiCarlo v. Suffolk Construction Inc., Feb. 12, 2016, Massachusetts Supreme Judicial Court

More Blog Entries:

Panoke v. Reef Dev. of Hawaii, Inc. – Presumptions of Injuries as Work-Related, Jan. 31, 2016, Georgia Work Injury Lawyer Blog