Third Party Workers’ Compensation Claims

Workers’ compensation exists to compensate employees who are injured on the job. In what most people think of as a "typical" workers’ compensation case, an employee is injured while at work, on their employer’s property. The injury resulted from either the employer's negligence, or the negligence of another employee. In a typical scenario the injured employee would be able to file a workers’ compensation claim with the employer. Since almost all North Carolina employers with three or more employees must have workers’ compensation insurance, the employer, or the employer’s insurance, will then be responsible to pay for the claim. 

Sometimes it is not that straightforward. An employee may be injured because of the negligence of someone who does not work for the employer. Take for example a delivery driver. If that driver is injured in a car accident during the course of a delivery, and the car accident was caused by the negligence of a driver who is not an employee of the same delivery service, the injured delivery driver might have a third party claim against the other driver. Similarly, a third-party claim against the owner of an office building could arise if that same delivery driver were to slip-and-fall on the stairs of an office building during delivery due to a hazardous condition that the owner was aware of.

In cases where a third-party is involved, the injured worker would likely have a claim against the third-party for causing the injury and against the employer because the employee was injured while performing his/her job. The most common third-party injury claims result from car accidents, premises liability (slip-and-falls, hazardous conditions) and product liability (defective equipment or tools used on the job).

In a typical North Carolina workers’ compensation case, where an employee is injured on the employer’s property, the employee cannot sue his/her employer in state court. Rather, the employee must file a claim with North Carolina’s Industrial Commission. North Carolina’s Industrial Commission is the agency tasked with, among other things, administering North Carolina’s Workers’ Compensation Act. 

In a case where a third-party claim exists, the Industrial Commission has no jurisdiction, and the injured employee can bring a third-party claim in court. In a third-party claim case, the injured employee would have to show that the third-party was negligent and that the negligence caused injury.

Advantages and Disadvantages of Third-Party Claims

Claims filed through the workers’ compensation system are often paid more quickly than those that are brought in court. That might be important if your injuries are severe and you will be out of work for an extended period of time. It could help to get your family through a difficult time a little bit easier. Unfortunately, the amount of damages recoverable are limited under workers’ compensation. Workers’ compensation is intended to reimburse injured employees for identifiable economic damages. It generally covers identifiable medical costs associated with the injury (bills, doctors visits, prescriptions, rehabilitation, mileage if you need treatment more than 20 miles away, partial pay for the time out of work if you are out of work for more than 7 days, and permanent partial or total disability benefits); pain and suffering is not awarded under workers’ compensation. 

Third-party claims generally take longer to resolve, particularly if you have to go to trial, but there is a chance that you will receive greater damages because claims brought in court are eligible to receive non-economic damages, or pain and suffering. In the case of severe injury and dramatic changes to your lifestyle, this could be a significant amount of money.   

Right of Subrogation

If you bring both a workers’ compensation claim against your employer and third-party claim, you will not recover double damages. Your employer, or its insurance company, has a right to recover the amount it paid to you from the third-party. The employer essentially has a lien against your damages. This concept is referred to as the “right of subrogation.” For example, using the delivery driver above, assume that the driver was rear-ended during the course of his/her deliveries and that he/she suffered a broken arm and was out of work for 8 weeks. Assume that workers’ compensation paid $5,000 in medical benefits and $3,000 in lost wages. If  the driver is successful in his/her third-party lawsuit and recovers $5,000 in medical benefits and $3,000 in lost wages, the employer (or the employer’s insurance company) would be entitled to recover that $8,000. 

The right of subrogation will have to be considered when deciding whether or not to bring more than one claim, and against what party(ies) you bring a claim. If your injuries are minor, it might not make sense to bring a third-party claim and risk that most, if not all, of the monies you recover be used to reimburse your employer or the workers’ compensation carrier. In the example above, if you only recovered $8,000, the entire amount would go to the employee and you would be in no better position than if you had just filed a workers’ compensation claim with your employer. If however, the damages were more severe, for example the delivery driver above was paralyzed, then it might make more sense to proceed with a third party claim against both parties, particularly since you could recover damages for pain and suffering.

Subrogation is an important consideration when dealing with a third-party workers’ compensation claim. An experienced Charlotte, North Carolina attorney will examine your case and discuss with you what damages are available and help you decide what claims it makes the most sense to pursue.  

Call Our Charlotte, North Carolina Workers’ Compensation Attorneys 

The Charlotte, NC lawyers at Rosensteel Fleishman Car Accident & Injury Lawyers are experienced workers’ compensation lawyers.They are available to discuss your workers’ compensation injury and help you to determine the best course of action during a difficult time. Please contact our office at 704-714-1450. There is no fee for an initial consultation.