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Workers’ Compensation Claim vs. Third Party Liability

Third party liability is a term that comes up frequently in discussions of workplace accidents and injuries. It refers to actions committed by a party other than the employee or his or her employer, i.e. a third party, that cause the employee to suffer an injury.

Generally, workers’ compensation claims are “no fault” claims. This means that negligence is not a factor used to determine which party is liable for the claimant’s damages or whether the claimant is entitled to recover damages at all. When an employee is injured while he or she is at work, performing a work-related duty, his or her employer is required to go through its workers’ compensation provider to compensate the employee for his or her medical expenses and lost wages.

There are a few exceptions to this, though. One of these exceptions is cases where the employee’s injury is clearly the result of a third party’s negligent or reckless actions.

Examples of Third Party Liability Claims

  • Negligent drivers whose actions cause car accidents that involve employed drivers, such as delivery drivers and chauffeurs;
  • Manufacturers of products that cause injuries to their users. These injuries can be a result of faulty design, defective items, or potentially-dangerous items that do not include adequate warning of the possible hazards of using them; and
  • Property owners who fail to remove hazards from their properties, causing employees to be injured while visiting these properties as part of their job.

If you are familiar with personal injury law, you probably recognize these cases as car accident claims, product liability claims, and premises liability claims. The process for filing a third party liability claim is the same as filing any other type of personal injury claim. A claimant must prove that the allegedly negligent party was, in fact, negligent and that negligence was the direct cause of the victim’s injury and subsequent damages. This can be achieved through an investigation of the claim known as discovery.

What are the Differences Between a Workers’ Compensation Claim and a Third Party Liability Claim?

The greatest difference is the damages that a settlement of each claim type can compensate for the claimant. A workers’ compensation claim can only be used to receive compensation for medical bills and some lost wages. It cannot be used to seek compensation for pain and suffering damages, which can include any intangible loss caused by an injury from mental anguish to the need for a mobility aid. A third party liability claim, on the other hand, has a lot in common with a personal injury claim in that a claimant may receive compensation for medical expenses, lost wages, and pain and suffering expenses through one. A claimant may also be able to recover punitive damages through a third party liability claim if the negligent party acted in an especially reckless or violent manner. For example, if the employee was injured because he or she was assaulted by a disgruntled customer, he or she might seek compensation from the punitive damages imposed upon the party responsible for his or her injury.

When an individual dies as a result of injuries sustained on the job, his or her loved ones may file a death benefits claim to receive compensation for the loss of the victim’s wages and for his or her funeral expenses. They cannot recover compensation for the loss of his or her companionship or the mental anguish they suffer after the death. Through a third party liability claim, they can recover these damages.

Another difference, as discussed above, is the lack of fault in workers’ compensation claims. To file a successful third party liability claim, the claimant must prove that the third party was negligent. A third party claim cannot be brought against an individual’s supervisor or colleague. It may only be brought against a party that has nothing to do with the company, such as a negligent driver or an employee of another company that shares the building where the claimant works.

Finally, third party liability claims also differ from workers’ compensation claims in how they are resolved. Third party liability claims may be settled out of court through a negotiation between the claimant’s attorney and the negligent party’s insurance provider or, if this does not lead to a settlement, taken to court to be determined by a jury. Workers’ compensation claims have a set of legal processes devoted to their resolution, which includes a strict set of filing deadlines and a division within the Tennessee Department of Labor devoted solely to handling and overseeing them. These claims may be appealed and in some cases, brought to trial, but only through the avenues provided by the Tennessee Department of Labor and Workforce Development Bureau of Workers’ Compensation.

Can I File Both a Workers’ Compensation Claim and a Third Party Liability Claim?

If you were injured at work because of a third party’s negligence, yes. In some cases, this is the most productive course of action to take because the money that the claimant receives from his or her third party liability claim can be used to cover the expenses that his or her workers’ compensation claim does not. For example, the claimant’s pain and suffering damages can be covered by a third party liability claim.

Talk to your attorney about the more intricate differences between a third party liability claim and a workers’ compensation claim. Both require specific actions from you, the claimant, as well as actions from other parties involved, like your employer. Your attorney can help you navigate the complex, sometimes confusing process of pursuing two vastly different types of compensation claim at once.

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