Apr 20, 2010
- Jack Martone, The American Equity Underwriters, Inc.
PART ONE OF TWO
Workers’ compensation claims are covered simultaneously by the Federal Longshore and Harbor Workers’ Compensation Act and by state’s workers’ compensation law in so called “concurrent” states. This presents problems for maritime employers.
The U.S. Constitution makes uniformity in maritime matters a priority. This is written into the Admiralty Clause (Art. III, Section 2). State laws cannot conflict with uniform national policy in this area. This is written into the Supremacy Clause (Art. VI). Powers not expressly granted to the federal government are reserved to the states (Tenth Amendment). There’s tension built into the system.
1910 – States begin enacting workers’ compensation laws;
1917 – U.S. Supreme Court holds that the states’ new workers’ compensation laws do not cover workers injured over navigable waters (Southern Pacific Ry. Co. v. Jensen, 244 U.S. 205 (1917));
1927 – Congress enacts the Longshore and Harbor Workers’ Compensation Act, covering workers injured over the navigable waters of the U.S.;
1972 – Longshore Act is amended to extend coverage landward for maritime workers;
1980 – U.S. Supreme Court holds that the Longshore Act does not supplant state workers’ compensation laws, but supplements them (Sun Ship v. Pennsylvania, 447 U.S. 715 (1980));
1984 – Longshore Act is amended and Sun Ship is not overruled, so concurrent jurisdiction is preserved.
Concurrent states – AL, AK, CA, CT, GA, IL, IN, KY, MI, MN, MO, NY, PA, RI, SC, VA, WV, WI
Exclusive states – FL, HI, LA, ME, MD, MS, NJ, OH, OK, OR, TX, WA
The “exclusive” states have expressly provided in their state insurance laws that if you are covered by a federal statute then you are not covered by state workers’ compensation law. Typical language appears in the Florida law: “No compensation shall be payable with respect to disability or death of any employee covered by the Federal Employers Liability Act, the Longshore and Harbor Workers’ Compensation Act, or the Jones Act.” But, in the “concurrent” states, the state workers’ compensation law may apply to workers who are also covered by the Longshore Act.
Section 905(a) of the Longshore and Harbor Workers’ Compensation Act (33 U.S.C. 905(a)) states, “The liability of an employer prescribed in section 4 shall be exclusive and in place of all other liability of such employer to the employee, his legal representative, husband, or wife, parents, dependents, next of kin, and any one otherwise entitled to recover damages from such employer at law or in admiralty on account of such injury or death recover damages from such employer at law or in admiralty on account of such injury or death….”
This language makes the Longshore Act exclusive with regard to suits for damages “at law or in admiralty”. State workers’ compensation claims are not considered to be suits at law or in admiralty. Thus, section 905(a) does not prevent state law from applying concurrently to Longshore Act claims
INCREASED COSTS FOR EMPLOYERS
Concurrent jurisdiction increases costs for employers:
– litigation costs are increased as employers must defend two claims,
– claims administrators must maintain two files under two regulators,
– attorney fees must sometimes be paid for claimant attorneys under two laws,
– there are occasionally duplicative benefits,
– there are two different insurance requirements,
– rules of evidence differ (for example, drug use defenses),
– possibly two different subrogation actions,
– there are different settlement procedures,
– there are different medical fee schedules,
– there are surprises (for example, the Longshore Act statute of limitations for filing a claim is tolled during the pendency of a state act claim)
Part II next week
ABOUT THE AUTHOR
John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers’ Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation. Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of AEU's Longshore Insider.