I am a Georgia attorney who represents people in
personal injury lawsuits. Often these clients have been hurt on the job, perhaps in a car accident
while the employee was driving for his job, or by a defective product
that the employee had to use for work. Because the injury occurred at
work, the employer has paid some medical bills or compensated the employee
for lost wages he incurred while he was out of work. After the personal
injury case concludes, the employer wants my client to reimburse it for
the money it paid out on the employee’s behalf.
I am in a series on the employer’s (or its workers compensation insurance
company’s) claim for reimbursement, which is called a subrogation
lien. Yesterday I explained that Georgia law does allow the employer to
have a lien – but in order to make sure the employee is fairly compensated,
the law puts restrictions on that subrogation lien. Today I will be talking
about how the law restricts the employer’s right to get its money back.
Restriction One: Full and Fair Compensation.
The first and most important restriction is that the employer cannot be
reimbursed until the employee has received full and fair compensation
for the injury. This restriction makes sense because of how the workers’
compensation program works. The purpose of the workers’ compensation
statute is to make sure that workers do not end up out-of-pocket because
they are hurt at work. Under the workers’ compensation statute,
the employer pays a relatively small amount — much less than it
would have to pay if the worker sued. As a counterbalance, the employee
is supposed to receive quick compensation for all of his or her medical
bills and expenses, without a lot of argument and hassle, and without
argument over who was at fault for the worker’s injuries. (Whether
that actually happens is a topic for another day.)
The law specifically says that the employer or its insurance company can
get its payments back only after the injured employee is “fully
and fairly compensated”: “the employer’s or insurer’s
recovery under this Code section shall be limited to the recovery of the
amount of disability benefits, death benefits, and medical expenses paid
under this chapter and shall only be recoverable if the injured employee
has been fully and completely compensated, taking into consideration both
the benefits received under this chapter and the amount of the recovery
in the third-party claim, for all economic and noneconomic losses incurred
as a result of the injury.”
O.C.G.A. § 34-9-11.1.
Full and fair compensation includes both economic damages (like lost wages
and medical bills), and also noneconomic damages (like pain and suffering.
The first rule, then, is that the employee gets compensated first. Until
the employee has been compensated, nobody else – including the employer
or its worker’s compensation insurance carrier – gets reimbursed.
Tomorrow I will talk more about this restriction, and also explain a couple
of additional restrictions that the law puts on the employer’s right
to get reimbursed for what it paid in workers’ compensation for
an employee who was injured on the job.