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High court says employers must pay
By Matt Pommer
June 15, 2004
Employers may be subject to bad faith penalties, independent of their insurance companies, if they fail to pay workers' compensation benefits to injured workers, the state Supreme Court ruled today.
In a 6-0 decision, the high court said state law "unambiguously requires" an employer to make payments to a disabled worker when liability is not disputed and "the only question is who will pay benefits."
An administrative law judge had ruled that Cesare Bosco was totally disabled from his job at the A.J. Polishing Co. in Kenosha, where he worked for nine years. The ruling directed A.J. Polishing and Shelby Insurance Co. to make disability payments to Bosco for the rest of his life. The companies did not contest the disability finding.
Shelby appealed through the courts contending it may not be responsible for the payments because another insurance carrier was used by the company during part of Bosco's work period with the firm.
Writing for the court, Justice Jon Wilcox said state law "unambiguously requires" an employer to pay the disabled worker when there is no dispute over liability and the remaining issue is who is financially responsible for the payments.
Wilcox noted that state law also allows for the imposition of bad faith penalties on an employer for failure to pay benefits in this sort of situations.
State law provisions read together, wrote Wilcox, recognize that an employee may recover directly from the employers, and whether the employer actually pays the money out of pocket, subject to indemnification by the insurer, or whether the insurer pays the money is dependent upon the specific insurance policy.
E-mail: mpommer@madison.com
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