Workers’ Compensation Update April 2015

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Exclusive Remedy Upheld By Florida Supreme Court

By Tom Murphy

In a previous article, I provided information regarding a ruling by Judge Jorge E. Cueto of Florida’s Eleventh Judicial Circuit Court in which Judge Cueto ruled the state’s workers’ compensation “exclusive remedy” provision was unconstitutional. He went on to say that the workers’ compensation reforms of 2003 “decimated” employee benefits and no longer provided a “reasonable alternative” for allowing injured workers to sue in civil court.

In December 2014, the Florida Supreme Court issued a unanimous decision in the case of Morales v. Zenith Insurance Company upholding the workers’ compensation system as the exclusive remedy for injured employees. The original lawsuit was filed as a wrongful death case after the deceased employee’s wife entered into a workers’ compensation settlement agreement with the employer’s workers’ compensation carrier, Zenith Insurance. As part of the agreement, Ms. Morales signed a release that specifically confirmed the agreement was the “sole remedy” for the insurance coverage Zenith provided to the employer.

Ms. Morales obtained a default judgment against the employer for $9.5 million. Zenith refused to pay the judgment. The federal court ruled that the Zenith workers’ compensation policy exclusion barred the suit and entered summary judgment in Zenith’s favor. The Florida Supreme Court agreed that workers’ compensation is the “exclusive remedy” and that the release in the workers’ compensation agreement was final.

As previously indicated, a number of lawsuits currently challenging the 2003 workers’ compensation reforms have played a major role in stabilizing the workers’ compensation system in Florida to bring it in line with other states. Experts agree that these lawsuits will continue as lawyers look to reverse the workers’ compensation fee schedule that was implemented in the reforms of 2003.