The quid pro quo premise underlying the social compromise known as workers’ compensation is simple: an employee injured at work receives no-fault medical expenses and wage replacement indemnity benefits and, in exchange, the employer is given protection from employee lawsuits and a statutory right to be reimbursed from the tortfeasor who actually caused the work-related injury – sometimes referred to as subrogation.

This is the employee’s exclusive remedy against the employer, who enjoys immunity from tort liability for the injuries.

The Exclusive Remedy Rule prevents injured employees from suing their employers and usually prevents culpable third parties from bringing a third-party action against the employer for contribution.

Even though every state allows the employee to bring a lawsuit against “third parties” (persons or entities other than the employer or employee), workers’ compensation benefits are the sole remedy available to the employee.

If and when the employee makes a third-party recovery, the employer’s workers’ compensation carrier is granted a statutory right of subrogation and/or reimbursement of the benefits it paid. If that were the end of the story, however, this article would not be necessary.