Analysis–Florida’s Workers’ Compensation Law Challenged in Court
Sep 3, 2014
A recent Florida court case, Florida Workers’ Advocates et al. v. Florida,1 could potentially upend Florida’s system of workers’ compensation. On August 13, 2014, circuit court judge Jorge E. Cueto in the 11th Judicial Circuit for Miami-Dade County held that a major section of the Florida Workers’ Compensation Law2 was unconstitutional. Under this section, known as the exclusive remedy provision,3 the employer liability scheme set forth under the Workers’ Compensation Law is the only remedy an employee who is injured on the job may pursue against his or her employer, with limited exceptions.4 If the decision stands, injured Florida workers will be permitted to file negligence actions against their employers. The following provides the highlights of the case, and places it in a broader legal-political context.
In May, 2011, plaintiffs Julio and Nelida Cortes sued Mr. Cortes’s employer, defendant Velda Farms. Plaintiffs’ claimed that Mr. Cortes was injured while working for defendant. Their claims proceeded in negligence and loss of consortium (counts I and III), and alleged that defendant was estopped from asserting immunity under the Workers’ Compensation Law (count II). Defendant asserted the workers’ compensation law as an absolute defense to liability.
In February, 2012, plaintiffs amended their complaint to add a fourth count, requesting a declaration that the Workers’ Compensation Law was invalid under the Florida and U.S. constitutions. In enacting the exclusive remedy provision, the Legislature had abolished a cause of action employees could otherwise bring against their employers; the Florida Constitution requires that when a cause of action is abolished, a reasonable alternative must be substituted in its place. The plaintiffs’ argument was that the system created by the Workers’ Compensation Law was not a reasonable alternative to the abolished cause of action.
Plaintiffs notified the Attorney General of the constitutional challenge, but they did not attempt to add the state as a party. Two public interest groups, Workers’ Injury Law and Advocacy Group (“WILG”) and Florida Workers’ Advocates (“FWA”) (together, the “Interveners”) intervened as to the constitutional challenge.
In 2013, defendant moved to withdraw its workers’ compensation defense, and thus dismiss count II for mootness as well as count IV, for which the court lacked subject matter jurisdiction because Velda Farms was no longer the proper party, and there was thus no controversy. The Interveners then moved to sever count IV and hear it separately without defendants’ counsel.
In April, 2013, the court severed count IV and dismissed Velda Farms from the case. It determined that the respondent would be the State of Florida, Office of the Attorney General. The Interveners then moved for summary judgment on count IV, but the court denied the motion because the lack of the original parties meant there was no underlying controversy for it to adjudicate; granting the motion would have been tantamount to issuing an advisory opinion, which is prohibited under Florida law.
Subsequently, in September, 2013 Elsa Padgett moved to intervene. Ms. Padgett, a former state employee who was near retirement age, was injured at her place of work in 2012, and subsequently forced to retire due to resulting complications. She alleged that the workers’ compensation law did not adequately compensate her for her injury. The court granted her motion to intervene, and the Interveners (now including Ms. Padgett) again moved for summary judgment. The court ordered the Attorney General’s office to show cause why the Interveners’ motion should not be granted.
In its response, the Attorney General’s office argued that the Interveners’ motion was procedurally defective, and that even if the procedural issues were overcome their arguments would fail on the merits.
The Attorney General’s office argued that it had never been properly added as a party. Under Florida law, the Attorney General is not a necessary party to cases involving constitutional questions, and the Attorney General has discretion whether to intervene in such cases. Since the Attorney General never intervened in this case, it is not a party, and the court cannot issue anything other than an advisory opinion.5 Furthermore, even if the Attorney General had been added by the Interveners, it would still be the improper party. The proper party-defendant in a lawsuit challenging the constitutionality of a statute is the government official with authority to enforce the statute. Since the Attorney General does not enforce the workers’ compensation laws, it is not the proper party to a lawsuit challenging the constitutionality of those laws. Therefore, there is no defendant, no controversy, and no jurisdiction with the court to enter a decision.6
The Attorney General’s office also argued that the Workers’ Compensation Law was constitutional regardless of the procedural issues because the statutory scheme was a reasonable alternative to the abolished cause of action. Florida courts have previously upheld Florida’s workers’ compensation system as reasonable. While a Florida appellate court panel had ruled unconstitutional another remedy under the Workers’ Compensation Law in Westphal v. City of St. Petersburg,7 the full court held on further appeal that the statute did not create a constitutional issue. The Attorney General further argued that the workers’ compensation law is reasonable because it removes the uncertainty of litigation, and lowers insurance rates for employers.8
The court granted declaratory relief for the Interveners on the motion for summary judgment, and held that the exclusive remedy provision was unconstitutional. The court noted that the Attorney General had not intervened in the case, but determined that it could still render judgment because Ms. Padgett’s intervention created a controversy.9 The court further reasoned that it could issue declaratory judgment despite the apparent lack of a defendant because the issue was capable of repetition in the future and might evade review.10
The court found that while the Workers’ Compensation Law originally had been a reasonable, and therefore constitutional, substitute to maintaining an action for negligence against an employer, subsequent legal developments and amendments to the Workers’ Compensation Law had rendered this alternative unreasonable. The primary reasons the court found the alternative unreasonable involve the state’s switch from a contributory negligence to a comparative negligence regime, and the absence of permanent partial disability benefits under the current Workers’ Compensation Law.
The court reasoned that the switch from a contributory negligence to a comparative negligence regime in 1973 rendered the Workers’ Compensation Law unconstitutional because this change substantially increased the chances of an injured worker recovering from an employer in a negligence action. Under contributory negligence, a plaintiff is barred from recovery if he or she was at all negligent in causing his or her injury. The exclusive remedy provision and related workers’ compensation benefits structure, the court reasoned, was thus a reasonable alternative to suing employers in court under the contributory negligence regime.11 However, the comparative negligence doctrine removes the absolute bar and allows a reduced recovery for plaintiffs whose negligence contributed to their injury, and, absent the Workers’ Compensation Law, the change would have allowed many more workers to successfully recover against their employer. Because the likely outcome of litigating against an employer for negligence changed in favor of injured plaintiffs, the exclusive remedy provision is no longer a reasonable alternative. This, combined with the repeal of the right to opt-out of the Workers’ Compensation Law, rendered the exclusive remedy provision unconstitutional.12
The court also found that the lack of permanent partial disability benefits under the current workers’ compensation law amounted to an unreasonable alternative to proceeding against employers in negligence. Permanent partial disability usually applies when a worker suffers an injury that causes a partial, but not total loss of income earning capacity, even though maximum medical improvement has been reached. While previous versions of the workers’ compensation law provided benefits for permanent partial disabilities, the current version does not. Because this remedy has been eliminated with no corresponding alternative remedy, the court determined that the current version of the Workers’ Compensation Law is unconstitutional.13
Decisions of trial courts generally only apply to the parties before the court, so the holding in this case will have limited applicability for the time being. The Attorney General filed a notice of appeal on August 26, and many commentators believe that the Florida Supreme Court may possibly review the case.
It is noteworthy that there have been other claims made by injured employees in an effort to chisel away at the Workers’ Compensation Law, particularly the reforms to the law put in place in 2003.
Specifically, there are three cases pending before the Florida Supreme Court that deal with the Workers’ Compensation law. In Westphal v. City of St. Petersburg,14 mentioned above, a firefighter was injured and unable to work at the end of the statutorily prescribed 104 week temporary disability period. However, because the claimant’s medical condition was still improving, he was ineligible for permanent benefits. The Court must determine whether this gap in benefits coverage violates the aforementioned reasonable alternative requirement of the Florida Constitution. The issue in Morales v. Zenith Insurance Company15 is whether the Workers’ Compensation Law provides the exclusive remedy for an employee injury as a result of an employer’s negligence, and whether the workers’ compensation policy exclusion in the employer’s general liability policy covers damage awards from separate negligence suits against the employer. Lastly, in Castellanos v. Next Door Company,16 the Court must determine whether the attorneys’ fees schedule of the Workers’ Compensation Law is constitutional.
The Court has heard oral arguments in the Westphal and Morales cases, but it has not set a date yet for Castellanos. The status of Florida’s Workers’ Compensation Laws will remain uncertain until the Court hands down its final opinions in each of these cases, including Florida Workers’ Advocates v. Florida.