Using the Workers’ Compensation Exclusive Remedy to Preclude Litigation

When an injury arises “out of and in the course of employment,” whether by an employer or a co-worker, typically the injured person has to pursue any remedies exclusively through the workers’ compensation system.  (Labor Code § 3602.)  This also applies to prisoners who are working for pay, even if it is a job that pays a nominal amount such as 25 cents per hour.  (Labor Code §§ 3370, 3602(a).)  The employer claiming exclusion under workers’ compensation must have workers’ compensation insurance and provide the benefits to the employee.  A SCIF form should be filled out as soon as practicable after the work injury is reported to the employer.

Both state and federal law claims are barred if the worker-plaintiff has a remedy in the workers’ compensation system. While the Labor Code provides specific exceptions to the rule of exclusivity, the exceptions do not include federal claims, section 1983 or Bivens claims.  (Labor Code §§ 3602(b), 3370(a)(9).)  The Legislature intends that workers’ compensation laws “shall be liberally construed by the courts with the purpose of extending their benefits for the protection of persons injured in the course of their employment.”  (Lab. Code § 3602.)

Exceptions to the Exclusivity Rule

Exceptions to the exclusivity of the workers’ compensation rule include:

  • When an employer physically assaults a worker or ratifies a co-worker’s assault of the employee;
  • When an employer does not have workers’ compensation coverage;
  • When an employer fraudulently conceals a worker’s injury and its connection to employment, thereby aggravating the injury;
  • When an injury does not arise out of the conditions of employment and is independent of the employment relationship (“dual capacity”), such as in a defective product received from a third person.

Importance of Workers’ Compensation Insurance

If an employer is uninsured, workers’ compensation laws provide legal presumptions that favor the plaintiff, including: (1) a presumption of the employer’s negligence; (2) removal of defenses of comparative negligence by the employee or assumption of the risk; (3) a presumption of negligence per se if there is an OSHA citation to the employer; (4) attachment of the employer’s property after filing the action to secure any potential judgment; and (5) allowance of attorney’s fees as part of any judgment.  Thus, it is essential for employers to keep their workers’ compensation insurance coverage current in order to both allow their employees to receive benefits and to preclude civil litigation arising from work-related injuries.

Emotional Injuries

Workers’ compensation covers most physical injuries in the workplace. But what about emotional injuries?  It is clear that an employee may file a workers’ compensation claim for work-related stress.  If the employee seeks and receives benefits for emotional injury, it may be considered in evaluating whether the person is precluded from filing suit.  If a civil suit is permitted to proceed, any workers’ compensation benefits received by the employee will be offset against the amount of a civil judgment.

Courts have held that when an employee attributes misconduct to the employer such as demotions, promotions, critique of work performance, and frictions in negotiation of workplace grievances, the employee cannot avoid the exclusive remedy provisions of the Labor Code by characterizing the decisions as unfair, outrageous, harassment, or intending to cause emotional distress.  Otherwise, employees would use such language to plead their way around the workers’ compensation system.  An employee may bring a civil suit only when the alleged misconduct results from risks reasonably deemed not to be within the compensation bargain.  For example, the exclusive remedy provision does not bar suits for sexual harassment and unlawful discrimination. These are not considered to be “bargained for” parts of a job.

Disability Cases

Historically, workers’ compensation claims were an employee’s exclusive remedy for disability discrimination; however, the California Supreme Court in 1998 held that disabled workers may pursue any and all remedies available under the law, including those in FEHA and the ADA (as well as workers’ compensation remedies).  These laws apply to employees whose work injuries or illnesses qualify as a disability under FEHA or the ADA.  This article does not cover accommodation or the interactive process. Suffice to say that the overlap and interplay between the workers’ compensation system and the grounds for a civil lawsuit based on disability and/or violation of state and federal leave statutes is complicated.


In sum, when an employer is sued for an injury to an employee during the course of his/her employment, it should strongly be considered whether the injury is exclusively covered under the workers’ compensation system.  This no-fault system will allow the employee to receive benefits but avoid the costs of protracted civil litigation and the potential risk of an adverse jury verdict.

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