Temporary Employee “Loophole” in Worker’s Compensation law

(2017 Wisconsin Act 139)

For over 100 years, a “grand bargain” has been applied to workplace injuries in Wisconsin. Employers must compensate their employees for work-related injuries and in return employees give up the right to sue the employer.

Over the past two years, a Worker’s Compensation-related lawsuit – Rivera v. West Bend Mutual Insurance – has been winding its way through Wisconsin’s court system. The relevant facts of the case are:

The Alex Drywall Company employed Carlos Rivera and provided him as a temporary, skilled worker to the Alpine Insulation Company. An Alpine-owned vehicle in which Rivera was traveling from one job site to another was involved in an accident. Rivera was killed in the accident.

Rivera’s estate did not make a claim for death benefits under Wisconsin’s Worker’s Compensation law but instead filed a wrongful death action against Alpine and its insurance carrier (West Bend Mutual Insurance).

On January 9, 2018, the District III of the Wisconsin Court of Appeals issued its ruling in this case. The three-judge panel concluded a temporary employee who has not made a claim for worker’s compensation is permitted to sue his or her temporary employer for damages. This ruling fundamentally altered the guiding principles of Wisconsin’s Worker’s Compensation program.

WIB joined with other business advocacy organizations to lobby for legislation which would close this “loophole.” Our efforts were successful.

Under 2017 Wisconsin Act 139, an injured employee of a temporary help agency engaged in work for the employer to which the employee is placed or leased may not sue the employer to which the employee is placed or leased if the employee has the right to make a claim for compensation under Wisconsin’s Worker’s Compensation law.