In an important decision, the Massachusetts Supreme Judicial Court issued an opinion regarding liens placed by workers’ compensation insurers on damages paid to employees through third-party settlements. In DiCarlo v. Suffolk Const. Co. (Mass. Feb. 12, 2016), the court addressed two separate cases in which a workers’ compensation carrier sought to apply liens to pain and suffering damages received by employees in their settlements with third-party tortfeasors. In a victory for injured employees, the Supreme Judicial Court ultimately held that damages for pain and suffering are not within a carrier’s lien. The court’s ruling means that employees may keep damages paid to them for their pain and suffering by a third-party.
The Massachusetts Workers’ Compensation Act is intended to provide the only legal remedy for industrial accidents suffered by employees against their employer. As such, employees are generally precluded from bringing personal injury claims against their employer as a result of a workplace injury if they are covered by workers’ compensation. However, in some cases where another party is responsible for the employee’s injuries, the employee may proceed with a civil suit against the third-party. If the employee succeeds in his or her claim against the third-party and is awarded damages pursuant to a judgment or settlement, the Workers’ Compensation Act allows the employer to recover the amount of workers’ compensation benefits that it paid to the employee. Specifically, pursuant to G.L. c. 152, § 15, when an employee recovers damages from a third party, the workers’ compensation insurer is statutorily entitled to a lien on the recovery in the amount that the insurer paid to the employee in benefits. In situations where the amount of the third-party settlement was less than the amount of the workers’ compensation lien, the insurer would often seek the entire amount. But, unlike workers’ compensation benefits, which do not provide damages for pain and suffering, personal injury claims allow for noneconomic damages, including pain and suffering.
In DiCarlo, the primary question for the court was whether the statutory lien attaches to damages paid by a third party for an employee’s pain and suffering. The court held that it does not. In reaching its decision, the court explained that the goal of the Workers’ Compensation Act regarding an insurer’s right to damages paid by a third-party tortfeasor to the employee for the same injury is not to return to the insurer the full dollar amount paid to an employee, but to avoid having an employee collect both benefits and damages for the same harm. The court’s holding essentially allows for insurers to recover only the kinds of damages that they paid to the employee, such as medical expenses and lost wages, but not loss of consortium or pain and suffering. Damages that the employer is not required to pay under Workers’ Compensation Act may therefore be retained by the employee.
If you have sustained a work-related injury, seeking compensation for your medical expenses, lost earnings, and other damages may be a beneficial decision. The dedicated attorneys at the Massachusetts firm of Pulgini & Norton represent individuals pursuing workers’ compensation benefits and other personal injury claims. To discuss your benefits claim with one of our experienced attorneys, contact our office at (781) 843-2200 or online.
More Blog Posts:
Massachusetts Reviewing Board Affirms Award of Workers’ Compensation Benefits, Including Handicapped Housing, Massachusetts Workers’ Compensation Lawyer Blog, published November 2, 2015
Massachusetts Employee Has Standing to Bring Claim for Reimbursement of Benefits Paid by MassHealth and Medicare, Massachusetts Workers’ Compensation Lawyer Blog, published December 10, 2015