Bill would ban third-party lawsuits by comp insurers, employers

Lawmakers in New Jersey are considering a bill that would prohibit workers compensation insurers from filing subrogation claims against a third party for employee injuries arising from automobile accidents.

 

S. 2866, introduced in the state Senate on Tuesday and referred to the Senate Labor Committee, follows a New Jersey Supreme Court decision in May in New Jersey Transit Corporation v. Sanchez and Smith that found that the New Jersey Transit Corp. was not barred by workers compensation law from filing an action against a third party for injuries sustained by an employee in a work-related automobile accident.

 

According a statement on the bill, the court decision “will allow for a cost-shift from the workers compensation system to the automobile insurance system, a result that was never intended by the Legislature and may raise premiums for consumers.”