Employer Gets Subrogation on Contract Suit
While an injured worker in Pennsylvania generally cannot sue his or her employer for causing a work injury (since Pennsylvania workers’ compensation is an “exclusive remedy”), the injured worker is able to sue a third party for causing a work injury. We see this situation with car accidents, slip and fall cases and products liability cases.
When an injured worker in PA does sue another party for causing his or her work injury (called a “third party”), and is awarded money, the workers’ compensation insurance carrier is entitled to be repaid money that it paid in medical expenses and wage loss benefits (this is called “subrogation”). Ultimately, unless the attorney negotiates something better (which is what happens normally), the injured worker ends up with no money from this third party case.
Not every law suit involving a work injury creates a right to subrogation, however. For example, a PA workers’ compensation insurance carrier is not entitled to subrogation in a medical malpractice award, if the work injury was not aggravated by the malpractice. The key is whether the award in the third party case is a direct result of what caused the disability.