In a major victory for the rights of injured workers, the Supreme Judicial Court ruled today that pain and suffering damages, to which injured workers are entitled in their accident cases, are not subject to liens from workers’ compensation insurance companies. As a result of the ruling, workers will be able to keep more of their personal injury settlements and verdicts.
Until today, there was confusion over the relationship between workers’ compensation liens and damages paid by a third party to employees for worksite injuries. If an employee gets injured, he or she is entitled to workers’ compensation for lost wages, medical bills, and other specific damages. But workers’ compensation insurance does not pay for pain and suffering damages.
If the worker collects workers’ comp, then successfully sues a third party (not his employer) for those injuries, he or she has a duty to reimburse the insurance carrier up to a point. The mechanism to regulate reimbursement to the insurance company is General Laws c. 152, § 15. The statute provides that an employer can recover its workers’ compensation payments to its employee, if that employee recovers money from a third party.
But, as mentioned above, workers’ compensation pays for lost wages and medical expenses. In a tort lawsuit, an injured party is entitled to more than that, including damages for pain and suffering. In the case where an employee simply recovers lost wages and medical expenses from a third party, there is no dispute that that money is returned to the workers’ compensation insurer in the amount that was paid. Any excess, the employee keeps. But, what about when an employee also gets money for pain and suffering? Does the workers’ compensation insurer get that money back, too?
Today, the SJC said, in no uncertain terms, no. They didn’t quite say “you can’t always get what you want.” But, they did say, you get can’t what you don’t pay for. Workers’ compensation does not pay for pain and suffering. So, if an employee gets a recovery that specifically sets aside damages for pain and suffering, that employee keeps that set-aside amount. Anything else is liable to go back to the workers’ compensation insurer for the amount that was paid (minus its fair proportionate share of attorney’s fees and expenses).
The cases were DiCarlo v. Suffolk Constr. Co., SJC docket no. 11854; Martin v. Angelini Plastering, Inc., SJC docket no. 11853 (both decided February 12, 2016).
For a more detailed analysis, click here.
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