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Court Rules Workers’ Compensation Insurance Is Exclusive Benefit for Job-Related Injuries
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Key Point 8-07.1. All states have enacted workers' compensation laws to provide benefits to employees who are injured or become ill in the course of their employment. Benefits generally are financed through insurance premiums paid by employers. Workers' compensation laws were enacted to give injured workers' a quicker, less costly, and more certain recovery than was possible by suing an employer directly for negligence. Prior to the general acceptance of workers' compensation statutes in the early part of the 20th century, injured employees were often unsuccessful in collecting damages from their employers. When they did collect, the awards were sometimes so high that they threatened the solvency of the employer. In every case, the costs to the injured employee of suing an employer were high. Churches are subject to workers' compensation laws in most states.

A New York court ruled that workers' compensation insurance is an exclusive benefit for job-related injuries, and therefore a worship leader who was injured when she tripped over a bass guitar cable could not bring a civil lawsuit against her church. A volunteer worship leader (the "plaintiff") was injured during a church service when she tripped and fell over an exposed power cord. The church is a parish within a Roman Catholic Diocese, which was self-insured with a workers' compensation policy that extended coverage to volunteers. The church applied to the Workers' Compensation Board for a determination of the injured plaintiff's eligibility for benefits. The injured plaintiff was notified on multiple occasions by the Diocese's claims adjuster that a claim had been filed and her exclusive remedy was workers' compensation.

Thinking that she would receive more benefits if she pursued a civil lawsuit, the plaintiff did not seek workers' compensation benefits and instead filed a lawsuit against her church. The church asked the court to dismiss the lawsuit on the ground that the workers' compensation is the exclusive benefit for employees injured on the job. The court declined to do so since it was unclear if the plaintiff was acting as a volunteer covered under workers' compensation at the time of her accident. On appeal, a state appeals court agreed with the church that the plaintiff was a volunteer covered by the state workers' compensation law, and this coverage was exclusive and precluded the plaintiff's civil lawsuit. The court concluded: "[A] plaintiff cannot elect to waive benefits under the Workers' Compensation Law and proceed on a tort cause of action … . Accordingly, the [trial] court should have granted the church's motion, in effect, for summary judgment dismissing the complaint based on the exclusivity provisions of the Workers' Compensation Law."

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