High court clarifies exclusive remedy for general contractors
The Illinois Supreme Court ruled Friday that the exclusive remedy provisions of the Workers’ Compensation Act do not extend to a general contractor who is not the employee’s immediate employer.
Bulley & Andrews LLC served as the general contractor for a construction project in Chicago that used workers with Bulley & Andrews Concrete Restoration LLC, doing business as Bulley Concrete. Bulley Concrete is a wholly owned subsidiary of Bulley & Andrews, yet the companies are operated as separate corporations, according to documents in Munoz v. Bulley & Andrews LLC, filed in Springfield.
As part of the scope of the project, Bully & Andrews used Bulley Concrete and its employees for the concrete work but did not enter into any such contract with Bulley Concrete.
Donovan Munoz worked for Bulley Concrete, as the company paid his wages and withheld taxes on his behalf. He suffered injuries while working on the project in December 2016, documents state.
Mr. Munoz filed a workers compensation claim against Bulley Concrete and also filed a personal injury action against Bulley & Andrews, which moved to dismiss the suit as barred by the exclusive remedy provisions of the Workers’ Compensation Act. It argued it had a preexisting legal obligation to pay for Mr. Munoz’s workers compensation benefits and that it did so. A circuit court judge granted the motion to dismiss and an appellate court affirmed.
In reversing and remanding, the Illinois Supreme Court said based on legal definitions “immunity does not hinge on the payment of benefits” in workers compensation law. Rather, “immunity is conferred only on immediate employers of an injured worker.” Since Bulley & Andrews was not Ms. Munoz’s immediate employer, the court said it was not immune from civil liability.
The fact that Ms. Munoz’s immediate employer was a subsidiary of Bulley & Andrews is of no import, the court added. If a parent company and its subsidiary are operated as separate entities, only the entity that is the immediate employer of the injured worker is entitled to immunity.
WorkCompCentral is a sister publication of Business Insurance. More stories here.
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