Alabama Workers' Comp Blawg

  • 18
  • Jan
  • 2025

Alabama Workers Compensation Act Survives Constitutional Challenge

             

On December 6, 2024, the Alabama Supreme Court released its opinion in the case of Crenshaw v. Sonic Drive in of Greenville wherein it refused to find the Alabama Workers’ Compensation Act unconstitutional. At the trial court level, a plaintiff, as the father of a minor employee, sued the minor’s employer for negligence as the result of an injury he sustained on the job. The employer quickly asserted the Alabama Exclusivity Doctrine which serves to protect employers from such lawsuits in exchange for providing no fault workers’ compensation benefits. The trial judge dismissed the lawsuit despite the plaintiff’s claim that the Alabama Workers’ Compensation Act was unconstitutional for a number of reasons. The focus of the plaintiff’s constitutional challenge was that the WC Act does not contain a mutual elective option. The plaintiff argued that, while employers can opt out of WC coverage, employees do not have that option. Both employers and employees had the right to opt out until the 1973 amendments at which time rights to both were extinguished. Then, the employers’ right to opt out was restored in the 1992 amendments. It was undisputed that the employees’ right to opt out was never restored. However, the Court of Appeals held that the legislature properly acted within its police power when it passed legislation that resulted in the unequal opt out right.

                                        

My Two Cents: You may be asking yourself, “self, what is this police power that the court relied on to allow for a WC Act that is undisputedly not mutually elective”? Good question! The answer is that a legislature exercises its police power if it enacts legislation that is designed to eradicate or ameliorate a perceived social evil.

                          

You may now be asking yourself, “self, what the heck does that have to do with the above constitutional challenge?” Another good question! To answer that, you must go back in time over 100 years to observe the conditions presented by the industrial revolution in the late 1800s and early 1900s. Safety could not keep pace with growth and a sharp increase in workplace injuries was the unfortunate result. Injured employees who could not work had no means of support for themselves or their families. They had no means of paying for medical treatment. Their only recourse was to sue the employer and attempt to prove liability and damages. The social insurance we now know as workers’ compensation was designed to provide no fault indemnity and medical benefits. In exchange for providing these benefits, employees gave up the right to sue employers in tort. This is commonly referred to as the Grand Bargain. While there have been numerous amendments to the Alabama WC Act over the years, the Grand Bargain remains fundamentally intact.

                           

The reality is that no Alabama high court is going to find the Alabama WC Act unconstitutional as currently drafted because it would adversely affect current and future injured employees, it would terminate all benefits for previously injured employees, and it would effectively terminate the employment of countless people working in the Alabama WC industry. When you consider all of that, is there any question that Alabama’s WC Act was designed to eradicate or ameliorate a perceived social evil? You will have to answer that one for yourself.

                      

This blog submission was prepared by Mike Fish, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third-party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Fish by e-mailing him at mfish@fishnelson.com or by calling him directly at 205-332-1448.

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