Filing Work Injury Claims Against an Employer's Liability Insurance

Workers' compensation and employer liability coverage are two parts of an employer's overall business insurance policy. Both are usually purchased together.

Workers' compensation is a form of no-fault insurance. The employee must show his injury occurred while performing his job duties, but it's not necessary to prove his employer was negligent.

Workers' comp provides reimbursement for medical and therapeutic services, medications, transportation to and from treatment, and partial wage loss. It does not include payment for the worker's pain and suffering.

Employer liability insurance protects employers from negligence claims brought by injured employees and, in some cases, their spouses. In these cases, the employee must show his injury occurred while performing his job duties, and that it would not have occurred "but for" the employer's negligence.

An employer liability claim seeks reimbursement for medical and therapeutic services, medications, transportation to and from treatment, full wage reimbursement, and a monetary award for pain and suffering. It does not cover workers' claims for punitive damages.

Almost all states require employers with one or more employees to carry privately purchased liability insurance. The exceptions are Ohio, North Dakota, Wyoming, Washington, the U.S. Virgin Islands, and Puerto Rico. These states and U.S. territories are covered by state-funded insurance pools. In these states, employers are bound by law to purchase coverage from one of the insurance pools.

Proving Your Claim

While workers' compensation claims do not require you to prove negligence, employer liability claims do. A worker must prove his injury would not have occurred if his employer wasn't negligent in some way. Proof of negligence requires four elements:

  1. The employer had a legal duty to protect the employee from undue harm or injury.

  2. The employer's actions or omissions breached that duty.

  3. The employee was injured as a direct result of his employer's breach of duty.

  4. The employee suffered tangible damages resulting from the injury (e.g. medical bills, lost wages, pain and suffering, etc.)

Example: Lack of Ear Protection

David is twenty-one years old. For several years he's worked as a landscaper. His primary duties included using a blower to move leaves and other debris. The leaf blower he used creates a noise at about 80 decibels. The maximum safe range for humans is about 60 decibels. (Medical studies have shown that prolonged exposure to decibel levels over 60 can result in significant hearing loss.)

Although David regularly asked his employer to provide ear protection, his employer failed to do so. Eventually, David permanently lost 50 percent of his hearing in both ears and needed hearing aids. David filed a workers' compensation claim for his injuries. Workers' comp paid all David's medical bills and a partial permanent disability award of $100,000.

David also filed a separate claim under his employer's liability insurance, claiming his employer was negligent in failing to provide him with hearing protection. Following a lawsuit, a jury awarded David $100,000 for actual damages and $500,000 for pain and suffering.

Example: Asbestos Inhalation

Tamara is twenty-eight years old and worked as an electrician for five years. Her primary duties included rewiring old buildings that were being refurbished for sale. After being ill for about a month, she had tests that revealed she was suffering from lung disease caused by inhaling asbestos. Her condition was virtually untreatable.

Tamara filed a workers' compensation claim and was awarded medical benefits and a permanent total disability award of $300,000. Tamara also sued her employer for negligence because he failed to notify her of the presence of asbestos and did not provide protective gear. A jury awarded Tamara full medical benefits and $300,000 in lost wages. The jury also awarded Tamara $1 million for pain and suffering.

The Difference between Employers Liability Insurance and Employers Practices Liability Insurance

Workers' compensation and employer liability insurance provide coverage for on-the-job bodily injuries and diseases.

Employer practices liability insurance provides coverage when a worker alleges his employer engaged in wrongful termination, sexual harassment, invasion of privacy, discrimination, breach of contract, false imprisonment, wage and hour law violations, or emotional distress.

A worker's right to file an employers practices liability claim can be based on Title VII of the Civil Rights Act of 1964, the ADA (Americans with Disabilities Act) of 1990, the Civil Rights Act of 1991, the ADEA (Age Discrimination in Employment Act) of 1967, and/or the Family and Medical Leave Act (FMLA).

Most employers practices insurance claims are based on six employee complaints founded on civil rights violations:

  1. Workplace harassment, including sexual harassment
  2. Wrongful termination of employment
  3. Emotional distress, including retaliation
  4. Invasion of privacy
  5. Defamation, including slander and libel
  6. Discrimination based on ethnicity, religion, sexual preferences, handicap, sex or age

Example: Sexual Harassment

While Lisa was working at a fast food franchise in Michigan, a male employee repeatedly uttered sexual innuendos at her. Lisa needed her job, so she reported the innuendos to her supervisor. The supervisor's response was, "Boys will be boys," and no action was taken against the male employee.

The sexual innuendos continued, and eventually the male employee's comments became sexually explicit. Again Lisa complained to her supervisor. The supervisor spoke with the male employee, who disputed the allegation. The supervisor cautioned him about his remarks, but no other action was taken.

One day the male employee fondled Lisa. Unable to tolerate the situation, she quit her job and retained an attorney. Lisa's attorney filed a claim for sexual harassment under the franchise's employers practices liability insurance. Her attorney invoked Section 103 of the Elliott-Larsen Civil Rights Act 453, as amended in 1980, which states:

Discrimination because of sex includes sexual harassment, which means unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct or communication of a sexual nature."

A jury awarded Lisa $100,000 in actual damages, and $300,000 for her emotional distress.

Example: Defamation

Eddie worked for several years as a salesman for a multi-national company. An investigation was launched into allegations he had embezzled funds from the company. Although Eddie's employment was terminated, he was never charged with any wrongdoing.

Eddie searched for a new job. Although he had applied at more than twenty companies, he was never offered a position. Eddie called the last company where he'd applied and asked why he wasn't hired. He was told that although he was fully qualified, there was a letter in his application file written by his former employer. The letter stated Eddie was terminated as a result of his possible involvement in an embezzlement scheme.

Eddie retained an attorney and filed a lawsuit against his original employer. The lawsuit was based on defamation by libel. (Libel is defamation by the printed word, slander is defamation by the spoken word). The company turned the case over to their employers practices liability insurance company. After trial, a jury awarded Eddie $50,000 in actual damages and $100,000 in mental anguish.

Evidence to Support Your Claim

As in any injury claim, evidence is the key to success. Without evidence, your liability claim will quickly be denied by the insurance company. With evidence, your employer will have a tough time trying to dispute your claim.

Photographs and video of the accident scene can be crucial. If you don't have a digital camera, use your cell phone. There's a good chance your employer will very quickly change the accident scene to remove evidence of negligence. The sooner you photograph and video the scene, the better.

Witness statements are another strong form of evidence. They don't have to be formal or notarized, and you can use any paper available. Get the witnesses to write down what they saw, and have them sign and date their statements. Be sure you have their contact information in case you need them later for a deposition or to testify at trial.

Example: Witnesses Substantiate Sexual Harassment

In Lisa's case, written statements from her coworkers substantiating her claim that the male employee made sexual innuendos and fondled her might be all she needs to successfully settle. Witness statements from other female workers who were also sexually harassed would be invaluable.

Example: Physical Evidence of a Dangerous Work Environment

In Tamara's case, photographs of the interiors of buildings where she was working could be helpful. Testimony from a doctor linking her lung disease to asbestos inhalation would be crucial in proving her employer's negligence.

The Role of Attorneys

Employer liability claims are more complex than workers' compensation claims. Unlike workers' comp claims where negligence isn't an issue, employer liability claims require proof of negligence. You should consult with a qualified attorney who can review your evidence and advise you on how proceed with your case.

An employer isn't going to voluntarily admit to violating your civil rights. It could open the door to more claims against him. Proving civil rights violations takes substantial legal experience and skills, so look for attorneys with expertise in this area.

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