Is Alabama Workers Compensation Unconstitutional?
Many of my clients complain about the fairness of Georgia’s workers compensation laws. From my perspective, those laws definitely favor employers and insurance companies instead of injured workers.
Each state has its own workers compensation system. State legislatures usually create these systems by passing a set of laws known as a workers compensation act.
Alabama’s workers compensation act came under attack recently. An injured worker filed a lawsuit claiming that Alabama workers compensation was unconstitutional. Now, an Alabama Circuit Court judge has found that the Alabama workers compensation act is unconstitutional.
Before reading further, you should understand that this finding does not go into effect immediately. Also, the decision may be appealed. If that happens, a higher Alabama court could make the final decision about the constitutionality of the Alabama workers compensation system.
What does the Constitution require of a workers compensation system?
In the United States, there are a number of different constitutions. Most people think about the Constitution of the United States. That constitution covers all states.
Each of these documents spells out a number of different rules. You might think about a constitution like a trump card. Laws cannot conflict with the rules put in place by the constitution.
How can a workers compensation system be unconstitutional?
As I mentioned earlier, state workers compensation acts are a set of laws. The legislative branch of the state’s government passes those laws.
When someone contends that a law or set of laws conflicts with that state’s constitution or the U.S. Constitution, that person can file a lawsuit. A court then makes a decision on whether the laws is constitutional or unconstitutional. If the court finds that the law is unconstitutional, it will essentially strike the law down.
In the case which recently decided that the Alabama workers compensation law was unconstitutional, the Alabama circuit court primarily examined a couple of parts of Alabama’s workers compensation law:
- The $220 per week permanent partial disability benefit
- The capping of attorney’s fees at 15 percent
The circuit court judge held that these parts of Alabama’s workers compensation law failed to comply with the constitutional requirements of due process and equal protection. As a result, the circuit court judge declared the workers compensation act unconstitutional.
What about Georgia’s workers compensation system?
Georgia has a different set of workers compensation laws than Alabama. For one thing, Georgia’s permanent partial disability benefits vary depending on an injured worker’s average weekly wage.
So, injured workers in Georgia who have a higher wage will draw more per week in permanent partial disability benefits than an injured worker who has a lower wage.
Does Georgia have limits on workers compensation attorneys fees?
Regarding attorney’s fees, Georgia’s law is somewhat similar to Alabama’s. Georgia has a percentage cap on attorneys fees. Currently, the legislature has set the percentage in Georgia at 25 percent. Also, the law in Georgia only allows attorneys to receive an attorney’s fee out of weekly indemnity benefits or settlement.
So, why does this matter to injured workers? It restricts an injured worker’s freedom to contract. As a result, some injured workers find themselves in a situation where they cannot get an attorney to take their case.
Why does this happen? Suppose that they passed a law saying that the most restaurants could charge for a hamburger is fifty cents. While this may sound great, we would quickly find out that businesses would just stop selling hamburgers because they could not get paid a fair amount for their product.
Attorneys fees can work much the same way. If attorneys handling workers compensation cases cannot charge enough for the work they do, they will simply choose not to take cases. They may simply decide not to take any workers compensation cases at all. Ultimately, this restriction harms injured workers if there are not good attorneys to represent them.
Have other states declared their workers compensation laws unconstitutional?
Yes. Some other states have declared their workers compensation laws unconstitutional. Florida, another Georgia neighbor, had part of its workers compensation system declared unconstitutional by its supreme court in 2016.
What effect will the Alabama workers compensation decision have?
It is too early to say. In the decision, the circuit court judge recognized that having the law declared unconstitutional could cause major confusion for doctors, injured workers, employers, and insurance companies.
Because of that, the judge placed a 120 day stay in the order to give the Alabama legislature an opportunity to fix the problem. Hopefully, they will address these problems and pass workers compensation law that are more fair to injured workers.
Even if the Alabama legislature does not fix the problem, the circuit court decision could be appealed. If it is appealed, an appellate court will review it and make a decision about whether they agree that Alabama’s workers compensation act is unconstitutional.
Jason Perkins is an attorney who specializes in representing injured workers. He regularly publishes videos and write blog articles about Georgia’s workers compensation system and issues that are important to injured workers and their families.
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