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Written by: Kyla Block
A trip and fall. Injury by machinery. Exposure to asbestos leading to a diagnosis of mesothelioma. These are life-changing events for employees (and employers) that may lead to a slurry of workers’ compensation claims. When the worst happens to an injured employee and his or her family is left behind, the Workers’ Compensation Act details the steps employers, insurance carriers, and administrators must take, as well as what family can anticipate in the aftermath of loss. The Act explains the scope of death benefits, including the different kinds of beneficiaries that may exist and how they will be allocated compensation. Considering key litigation helps to demonstrate how the statutes are applied in practice.
According to the Act, a beneficiary may be someone wholly dependent on the employee, or they may be only partially dependent. If only one person is deemed to be wholly dependent, then he or she will receive the entire share of benefits. The Act considers widows, widowers, and children to be whole dependents. If there are multiple individuals who are deemed to be wholly dependent, then the compensation they receive will be divided among them “according to the relative extent of their dependency (Section 97-39).”
Partial dependents, unlike whole dependents, receive benefits in proportion to the amount of support they received from the deceased employee at the time of his injury. If there are neither whole nor partial dependents, compensation is assigned to whoever may be “next of kin.” These may include adult children, brothers and sisters, or parents. Next of kin, in the absence of whole or partial dependents, will receive the full compensation owed in a lump sum. In the absence of next of kin or dependents of any kind, no compensation death benefits will be paid. However, the employer must still pay for funeral expenses.
Typically, beneficiaries to the compensation of a deceased employee will be due 66 and 2/3 percent of the employee’s average weekly wages calculated at the time of his or her injury. Benefits will be paid at this rate for 500 weeks from the date the employee dies. However, dependent children will continue to receive benefits beyond 500 weeks until they reach 18 years. Finally, if the deceased’s widow or widower is physically or mentally unable to care for themselves as of the time the employee’s death, then the widow or widower will continue to receive benefits throughout life until or if they should remarry.
Prior litigation highlights the nuances in how our courts consider and apply death benefits owed under the Act. For example, Deese v. Southern Law and Tree Expert Company (1982) provides guidance on what happens if the pool of eligible beneficiaries pass away. The North Carolina Supreme Court considered the case of Charles W. Deese, who died following his compensable injury. At the time of his death, Deese was married with three dependent children under the age of 18. As his children reached 18 years, they would become ineligible to receive further compensation. Deese’s family argued that the amount of compensation no longer paid to children who reached 18 years should be reassessed and lumped into the amount remaining for any children who had not yet reached adulthood. To reassess the amount owed to remaining dependents would essentially increase the amount remaining beneficiaries could claim. However, the Court found that the only timeline during which apportioned benefits could be changed would be within the first 400 weeks. The Court further noted that the Act is not intended to “provide…the equivalent of general accident, health, or life insurance.” Thus, the amount of death benefits owed to dependents cannot be reapportioned when the 400 weeks have elapsed, even if dependents age out and are no longer eligible to receive benefits.
Not just anyone can claim death benefits. The NC Supreme Court has made key decisions regarding who may–and may not–be considered a beneficiary. In Fields v. Hollowell & Hollowell (1953), the Court considered the possibility of awarding death benefits to a long-time unmarried partner. Following the death of the employee, William Edward McMillan, the Industrial Commission awarded death benefits to the deceased’s mother. Of note, McMillan’s mother was not reliant upon him financially–she was awarded benefits as “next of kin,” and not as a dependent. McMillan’s cohabitating partner, Julia Mae Fields, appealed on the grounds that she was dependent on the deceased and should receive death benefits. The Court found that not only was it “alien to the customs and ideas of our people” to allow the same benefits to a cohabitating couple as it would to a married one, but it would also pave the path to denigrate the rights of the “legitimate claims of helpless defendants.” The Court denied Fields’ claim for benefits, reversed the decision of the Court of Appeals, and remanded the case to the Industrial Commission to award its initial denial of her claims.
If death occurs following occupational illness instead of one-time accidental injury, prior litigation explains what beneficiaries and employers can anticipate. In the seminal case of Booker v. Duke Medical Center (1979), the NC Supreme Court considered the claims of the family of Michael Booker. Booker worked as a laboratory technician at Duke Medical Center. As a part of his job duties, Booker regularly handled unmarked blood samples contaminated with serum hepatitis. Several years into his employment, he contracted serum hepatitis. After filing a claim for workers’ compensation benefits, Booker subsequently died from his illness. The Industrial Commission granted death benefits to his surviving wife and four children. When Duke and the insurance carriers appealed, the Court of Appeals reversed the award. The case then went before the NC Supreme Court.
The Supreme Court considered whether serum hepatitis could be considered an occupational disease and under what statute Booker’s dependents could claim death benefits: the statute in effect at the time of Booker’s initial worker’s compensation claim, or the amended statute in effect at the time of his death. While the Court of Appeals argued that the statue governing death benefits should be the one in effect when Booker became sick, the Supreme Court stated that the determining statute should be the one in effect at the time of Booker’s death, since “these amendments were made applicable to cases originating on and after their effective date.” Additionally, the Supreme Court held that Booker’s disease was occupational, even though it was admittedly a disease that any person could contract. Key for the Supreme Court was expert testimony noting that, though serum hepatitis is not a disease specific to laboratory technicians, Booker’s occupational exposure to the disease vastly exceeded that of the general population, putting him at significant occupational risk. The Supreme Court reversed the decision of the Court of Appeals and returned the matter to the Industrial Commission to award benefits to Booker’s family.
In Deese, the Court explained, “in all cases of doubt, the intent of the legislature regarding the operation or application of a…provision is to be discerned from a consideration of the Act as a whole–its language, purposes and spirit.” The Act details the circumstances under which someone can be considered a beneficiary and claim death benefits. When seeking clarity on how to file for and pay out death benefits claims due to compensable workplace injury or occupational disease, employers and beneficiaries should look to the statutes and existing prior case law to understand how courts will interpret and apply these regulations, as well as under what circumstances exceptions do and do not exist.