Issue link: https://read.dmtmag.com/i/703158
28 Oil Prophets H. Dean Mooty, Jr. Mooty & Associates, P.C. As most of you have five or more employees in your business, you know, as is required by State law in Alabama, you must maintain workers' compensation insurance. However, work comp insurance is one of those areas in a business' operation that is easy to "wash your hands of." What I mean is, once you buy the insurance, it's easy to assume that it takes care of itself, and you don't have a role to play. Nothing could be further from the truth. What you pay for workers' compensation insurance is obviously a function of the type of business you have and what type of employees you have doing what jobs. The industry assigns class codes to various types of work, and in turn those class codes are associated with certain risk modifications and resulting premiums. Regardless, other than the obvious calculations based on the size of your payroll, the premium is impacted by your loss history. Going forward, the same is true. Thus, the more you can do to minimize losses and resulting work comp claims, the better you can control your work comp premiums. I like to tell people that workers' compensation insurance insures negligence of your employees and even an employee's idiocy in many instances. Stated differently, it is not a defense to a work comp claim – in most instances with very limited exceptions – that an employee does something that causes his or her injury. There is no concept of contributory negligence in the work comp world as it is in the general tort world. In the general tort world, and in a state like Alabama that has a contributory negligence rule of law rather than a comparative negligence rule of law, if you do something that contributes to your injury, you are not supposed to be able to recover for those injuries. That doesn't apply with workers' compensation insurance. The trade-off, however, with work comp insurance is your exposure is quantifiable. The work comp statute dictates how much an injured worker can recover for certain types of injuries. You know what your ultimate exposure, or stated differently, your maximum exposure, can be even in a case where an employee is determined to be permanently and totally disabled from the resulting on-the-job injury. Workers' compensation cases are non- jury cases only. Thus the other benefit to the employer with having to provide work comp insurance is it is not exposed to jury trial litigation where the damage exposures are often unknown and unquantifiable. So what can you do? It is important that your provider of workers' compensation insurance has a quality "loss control" program. If they don't, go somewhere else for your work comp insurance. You need a carrier that has the personnel to come into your business and help you and your company identify risks and to implement steps to minimize, if not eliminate, those risks to your employees. Depending on the nature of the work, those measures can oftentimes be as simple as the use of back braces, lifting restrictions, insistence to keeping floors clean, use of certain type of ladders and the requirement to use ladders only under appropriate circumstances and use them properly, and on and on and on. Much of these loss control measures would seem to be common sense, but you would be amazed at how people get hurt under seemingly simple and innocent circumstances. I like to tell the story of one of the earliest work comp cases I handled almost 30 years ago. This is a great example of contributory negligence not being a defense in a work comp claim. The C-store clerk had a bucket of ice that she was using to reach up and pour into the fountain drink dispenser. She did so, overfilled the ice reservoir, spilling ice on the floor and then turns to head back to the counter and slips in the ice she has just spilled on the floor, falls and tears her knee up. With knee surgery and other related medical care later, the work comp carrier spends over $30,000.00 on her medicals. That is a "covered" work comp claim. Her obvious role or fault in causing her own injuries is irrelevant. This can be frustrating. Other simple matters such as requiring people that operate vehicles as a part of their work, be they trucks, personal vehicles, forklifts or otherwise, must be required to use seatbelts. That is, of course, for their own personal safety, but it also serves a role for you as the employer. If as an employer you specifically and clearly instructed your employees on the proper LEGAL CORNER Workers' Compensation Insurance Fundamentals: