Disclaimer: This article provides general information on Massachusetts law and does not constitute legal advice. Consult an attorney for advice regarding your specific situation.
Detailed Answer
When an employee injured on the job pursues both workers’ compensation benefits and a personal injury claim against a third party, Massachusetts law requires coordination to prevent double recovery. Here’s how it works under Massachusetts law:
1. Workers’ Compensation Coverage
Under Massachusetts General Laws, Chapter 152, injured workers receive medical benefits, temporary or permanent disability payments, and vocational rehabilitation. The Department of Industrial Accidents administers these benefits.
2. Third-Party Tort Claim
If a negligent party (someone other than your employer) caused or contributed to your workplace injury, you may file a personal injury lawsuit seeking compensation for pain and suffering, medical expenses not covered by workers’ comp, and lost wages beyond statutory caps.
3. Employer/Insurer Subrogation Rights
Massachusetts General Laws Chapter 231, Section 60H gives your workers’ compensation insurer the right to reimbursement out of any third-party recovery for benefits it has paid. The insurer must assert its lien promptly and in writing.
Key statute: M.G.L. c.231, § 60H
4. Allocation and Settlement
When settling your personal injury case, you and opposing counsel should negotiate an allocation of the settlement proceeds. Typical categories include:
- Medical expenses
- Lost wages (beyond comp benefits)
- Pain and suffering
- Future care costs
A clear allocation helps determine the insurer’s reimbursement. Only the portion attributable to lost wages and medical expenses overlaps with workers’ compensation benefits.
5. Attorney’s Fees and Costs
Under M.G.L. c.231, § 60H, if the workers’ compensation insurer recovers from your settlement, it must reimburse you for a pro rata share of attorney’s fees and litigation costs. This prevents the insurer from recouping the full benefits paid without shouldering its share of legal expenses.
6. Practical Steps
- Notify your workers’ compensation insurer early of any third-party action.
- Obtain a written statement of benefits paid and the insurer’s lien.
- Work with your attorney to draft a settlement agreement allocating damages among categories.
- Ensure the insurer’s reimbursement and fee allocation provisions appear in the settlement documents.
- File any required notices with the Department of Industrial Accidents, if applicable.
Helpful Hints
- Keep detailed records of medical bills and lost wages for precise allocation.
- Review your workers’ compensation award letter to confirm benefits covered.
- Engage counsel experienced in both workers’ compensation and personal injury coordination.
- Obtain the insurer’s lien amount in writing before settlement negotiations.
- Double-check that the settlement agreement explicitly addresses subrogation and fee sharing.
- Consider future medical needs when allocating settlement proceeds.