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Workers' compensation immunity reliability

Workers' compensation immunity benefits companies who have lawfully retained workers' compensation insurance by preventing them from being subjected to separate lawsuits in the event an employee is injured while on the job. This is especially important in the construction industry, where accidents on the job are more prone to happen than in many other industries.

Due to the dangerous nature of construction work, the importance of having workers' compensation immunity for contractors and subcontractors alike is being heavily reinforced throughout the industry. A general contractor who has workers' compensation insurance wants to make sure any sub-contractors they hire also have workers' compensation insurance.

A 2017 Florida case (Fisk Construction, Inc., V Obando) shows just how confusing this can get sometimes. In this case, a roofer hired by a general contractor, hired a sub-subcontractor. Then a laborer was hired by the foreman of the sub-subcontractor. The laborer became injured on the job and filed a lawsuit against the sub-subcontractor.

The sub-subcontractor, having workers compensation insurance, attempted to rely on workers' compensation immunity for his defense, only to be stopped by the trial court.

It appears that the workers' compensation insurance policy initially denied benefits to the laborer; therefore, the court denied immunity to the sub-subcontractor. The insurance company did finally agree to provide compensation for the injured employee's hospital and medical bills. The case was appealed, and the Third District Court reversed the finding and allowed the sub-subcontractor to rely on workers' compensation immunity as his defense.

A possible reason for the initial denial by workers' compensation may have been because laborers are often hired daily or on the spot. Maybe he was not recognized as an employee, and it took some investigation or research to establish that he was indeed working for the sub-subcontracting company.

These types of issues are sure to arise from time to time in this field of work. Even workers' compensation immunity can be denied in such scenarios. If the company had not been able to prove the laborer was on their payroll (if that was indeed the problem), the lawsuit could have persisted, leaving the company in the hands of their construction litigation attorneys.

Source: Florida Construction Legal Updates, "Hiring Subcontractors With Workers Compensation Insurance," David Adelstein, Dec. 31, 2017

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