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Workers Compensation
University of South Carolina School of Law
Lacy, Stanford E.


Professor Lacy Fall 2017

Exam: T/F, short answer, MC closed book exam 75-100 questions

Know black letter law, as well as the why’s and the where’s

Class 1 Exercise: 1933 Work Incident

No WC Act existed yet so this would be a TORT claim
(P) Complaint:


Negligence—duty, breach, causation, damages

(D) Answer:

General Denial
Affirmative Defenses:

Contributory Negligence
Assumption of Risk
Fellow Servant Rule—if someone was injured as a result of a co-worker’s negligence, you could not hold the employer liable

History of Workers’ Compensation in South Carolina

Problems Before the Act

Injured employees bore the burden of proof and employers had control of all of the evidence.
Employers had no incentive to change and make working conditions safer.
If jury returned a huge verdict for injured worker, employer could go out of business and hundreds of people could lose their jobs—danger of excess and inconsistent verdicts.
Litigation between employers and employees tied up the courts, as it made up about one-third of all litigation.
Employees feared bringing suit for fear of being fired.
Time was a big factor. Litigation takes years, so what does the injured worker do in the meantime?

Solutions Provided by the Act

The Act, passed in 1935, eliminated negligence as a cause of action between employees and employers and established a no fault system. This eliminates all of the employer’s affirmative defenses (contributory negligence, assumption of risk, etc.). So, employee only has to prove that his injury arose during scope of employment, not that the employer was negligent.
Insurance premiums are based on accident history, providing an incentive for employers to offer safe working conditions—Employers must be covered

The Act itself is the actual insurance policy delegating what the employer will have to pay

Benefits awarded to injured workers are defined by statute, which solves the problem of excessive verdicts or the worker becoming a ward of the state.

Indemnity benefits
Medical benefits

The Act created an agency to deal solely with these cases by giving them exclusive jurisdiction, which solved the problem of clogging up the courts. (First, the agency was known as the Industrial Commission, then the Workmen’s Compensation Commission, and now is the Workers’ Compensation Commission.)
Workers’ Compensation is the exclusive remedy for the injured worker against the employer
Statute protects employees from being fired.
The Commission gets cases through much more quickly than if an action had been filed in the circuit courts, and employees receive quick payments.
Simplifies the system to be a “form” practice

Post Act Procedure:

Form 50- Complaint

EE/ER Relationship
Arose out of Employment
Damages—TTD, PPD, PTD

Form 51- Answer

Admit/Deny allegations in the 50

Exclusive Remedy

Workers’ compensation is the exclusive remedy in South Carolina for injuries occurring in the workplace, as expressly held by the S.C. Supreme Court.
S.C. law mandates employers to have workers’ compensation insurance as of June 18, 1996. Originally, an employer could elect not to carry WC insurance. Only government entities had to be in WC, and for everyone else it was elective.

Employer or employee could elect not to be part of the Act. If no WC insurance, employee could sue if he was injured. Employer, if sued, was prohibited from asserting any of the common-law defenses, so there was an incentive built into the Act to encourage election of coverage.
On June 18, 1996, they did away with the elective provision in the law. Now, it’s mandatory to be part of the system—employers either have to have WC insurance or be self-insured. See S.C. Code Ann. §42-1-310 (“Every employer and employee . . . shall be presumed to have accepted the provisions of this title . . . and shall be bound thereby.”).

If there is a legal doubt as to whether the Act applies, there is a presumption in favor of inclusion.

**Workers’ Compensation covers employees, not employers

Statutes are to be interpreted liberally—in favor of the employee
Where there is legal doubt, that doubt will be resolved in favor of inclusion over exclusion
BOP is on the employee
Legislative Intent—most important thing to convincing the Sup Ct that your interpretation is right

Exemption Under the Act


§42-1-320: Public entities and their employees cannot exempt themselves. “The State, its municipal corporatio

mployees count.
A corporation is an entity and its president counts as a person under the law. So a corporation with 3 employees and a president has 4 employees for purposes of the Act.
In a partnership, the partners are actually the employers and therefore do not count towards the number of employees.

The partners are the entrepreneurs—their personal assets are at stake

In a professional corporation, the partners sign contracts so they would probably be considered employees under the Act.
Employers are generally not covered under the Act, but they may choose to opt-in for coverage. (See §42-1-130)

The Worker’s Comp. Act was written to protect the employees. It also helps employers, but it only allows for employees to recover.

Employee Definition – §42-1-130 – The term “employee” means every person engaged in an employment under any appointment, contract of hire, or apprenticeship, express or implied, oral or written, including aliens and also including minors, whether lawfully or unlawfully employed.
Employer Definition – §42-1-140 – The term “employer” means the State and all political subdivisions thereof, all public and quasi-public corporations therein, every person carrying on any employment and the legal representative of a deceased person or the receiver or trustee of any person.
Employment Definition – §42-1-150 – The term “employment” includes employment by the State, all political subdivisions thereof, all public and quasi-public corporations therein and all private employments in which four or more employees are regularly employed in the same business or establishment (any less than four and the employer does not have to have worker’s comp insurance).

An owner does not count as an employee for this purpose, but if he say makes himself a president of the company and thus an employee then he does count.
Partners do not count as employees.