State News : North Carolina

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North Carolina



By: Tracey Jones and Chris Stipes

The increasing trend of employers to provide on-site medical staff can have numerous benefits for both employees and employers. Due to convenience, employees may be more likely to utilize the on-site medical services, leading to quicker identification of health issues and easier management of health care needs and costs for both parties. Employees may spend less time away from work dealing with medical issues, leading to fewer insurance claims. Essentially, on-site medical staff seems to encourage prevention, which is an overall cheaper and more effective method of health care. Unfortunately, a recent Court of Appeals decision has created concern over liability exposure for the employer.

The Workers’ Compensation Act has frustrated North Carolina employers because there is no “fault base” analysis in cases, however, the Act has afforded North Carolina employers “limited” liability in cases and allows employers to calculate their exposures with a much needed accuracy that is hard to obtain in the civil liability arena.

This benefit has been strained in Jackson v. The Timken Co., a recent decision from the North Carolina Court of Appeals published in May, 2019. The Court allowed a Plaintiff in a denied workers’ compensation claim to bring an action in civil court, potentially spoiling the exclusive remedy doctrine.

Plaintiff suffered a stroke while at work. His supervisor noticed Plaintiff was having difficulty completing work tasks and escorted him to the occupational health nurse (with 41 years of experience) who completed a physical examination of Plaintiff. Plaintiff walked without assistance, responded appropriately to questions, exhibited no weakness, followed commands, and had no change in speech, balance or facial feature. Plaintiff’s wife was called to pick him up. Plaintiff collapsed in the parking lot of his primary care provider’s office and was rushed to the hospital by EMS.  He survived, but suffered permanent injuries.

Plaintiff first filed a workers’ compensation claim with the Industrial Commission. The parties stipulated that each party was bound by and subject to the North Carolina Workers’ Compensation Act, and noted the Industrial Commission had subject matter jurisdiction. While Plaintiff was waiting for the Industrial Commission to issue a decision, Plaintiff filed a complaint in Gaston County Superior Court. The employee alleged he was negligently diagnosed and treated by the on-site nurse. The Deputy Commissioner issued an Order denying Plaintiff’s workers’ compensation claim because Plaintiff did not suffer a compensable injury by accident, and Plaintiff did not appeal the Order. Defendants then filed a Motion to Dismiss for lack of subject matter jurisdiction in the Superior Court, which was denied. Defendants appealed.

The main issue is whether the Superior Court had jurisdiction over Plaintiff’s claim when the claim has already been heard and denied by the Industrial Commission because it does not fall under the scope of the Act. Unfortunately, the Court held that if the Industrial Commission lacks exclusive jurisdiction to hear a claim that occurs in the course of one’s employment, a trial court does not err in asserting subject matter jurisdiction over the claim.

In upholding the Superior Court’s decision to assert subject matter jurisdiction over this case, the Court contradicted the Supreme Court’s decision that the Act “provides the exclusive remedy when an employee is injured in the course of his employment by the ordinary negligence of co-employees.”  Abernathy v. Consolidated Freightways Corp. of Delaware, 363 S.E.2d 559 (N.C. 1987). The Court tried to distinguish Abernathy on the basis that the Plaintiff alleged his co-worker was liable for breaching N.C.G.S. §90-21.12, our statute establishing a special duty for medical professionals when rendering care, and because, unlike in Abernathy, Plaintiff did not suffer a compensable injury by accident.

These weak distinctions do not help employers in North Carolina feel better about the Court’s analysis. Typically the only exception to the exclusive remedy doctrine happens when an employer’s conduct is intentional and substantially certain to cause serious injury or death, which is not the case here. The Court’s analysis on this question is concerning for two reasons. First, the Court seems to carve out an additional exception for claims asserted under the medical malpractice statute, which potentially increases exposures for employers that keep medical staff on site. Second, the Court seems to suggest that whenever a claim is denied by the Industrial Commission for not meeting the elements of a compensable claim, the Plaintiff has a second chance at a remedy by filing a civil suit. That seems to defeat the purpose of the exclusive remedy provision and opens the floodgate for ordinary workers’ compensation claims being heard in civil courts.

Risk Handling Tips: In light of this case, North Carolina employers must ask themselves whether having an occupational health professional on site to help their employees is worth the risk of being sued in civil court, which inevitably results in higher exposures. This Opinion was unanimous, but a Petition for Discretionary Review has been filed with the North Carolina Supreme Court.