§ 624. Dual liability; claims, settlement procedure

(a) Where the injury for which compensation is payable under the provisions of this chapter was caused under circumstances creating a legal liability to pay the resulting damages in some person other than the employer, the acceptance of compensation benefits or the commencement of proceedings to enforce compensation payments shall not act as an election of remedies, but the injured employee or the employee's personal representative may also proceed to enforce the liability of such third party for damages in accordance with the provisions of this section. If the injured employee or the employee's personal representative does not commence the action within one year after the occurrence of the personal injury, then the employer or its insurance carrier may, within the period of time for the commencement of actions prescribed by statute, enforce the liability of the third party in the name of the injured employee or the employee's personal representative. Not less than 30 days before the commencement of suit by any party under this section, the party shall notify, by registered mail at their last known address, the Commissioner, the injured employee, or in the event of death, the employee's known dependents, or personal representative or known next of kin, the employee's employer, and the workers' compensation insurance carrier. Any party in interest shall have a right to join in the suit but the direction and control of the suit shall be with the injured employee.

(b) Prior to entry of judgment, either the employer or the employer's insurance carrier or the employee or the employee's personal representative may settle their claims as their interest shall appear and may execute releases therefor, but the consent of the employer, or, if insured, the insurance carrier, shall be required, if the amount of the settlement by the employee or the employee's personal representative is less than the compensation benefits which would have been payable in the future but for the provisions of this section.

(c) The settlement and release by the employee shall not be a bar to action by the employer or its insurance carrier to proceed against the third party for any interest or claim it might have.

(d) In the event the injured employee or personal representative settle the claim for injury or death, or commence proceedings thereon against the third party before the payment of workers' compensation, the recovery or commencement of proceedings shall not act as an election of remedies and any monies so recovered shall be applied as provided in this section.

(e)(1) In an action to enforce the liability of a third party, the injured employee may recover any amount which the employee or the employee's personal representative would be entitled to recover in a civil action. Any recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery, shall first reimburse the employer or its workers' compensation insurance carrier for any amounts paid or payable under this chapter to date of recovery, and the balance shall forthwith be paid to the employee or the employee's dependents or personal representative and shall be treated as an advance payment by the employer on account of any future payment of compensation benefits. Reimbursement required under this subsection, except to prevent double recovery, shall not reduce the employee's recovery of any benefit or payment provided by a plan or policy that was privately purchased by the injured employee, including uninsured-underinsured motorist coverage, or any other first party insurance payments or benefits.

(2) Should the recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery, be less than the full value of the claim for personal injuries or death, the reimbursement to the employer or workers' compensation insurance carrier shall be limited to that portion of the recovery allocated for damages covered by the Workers' Compensation Act. If a court has not allocated or the parties cannot agree to the allocation of the recovered damages, either party may request that the Commissioner make an administrative determination. Upon receiving a request, the Commissioner shall order mediation with a mediator selected from a list approved by the Commissioner. If mediation is unsuccessful, the Commissioner may adjudicate the dispute or refer the dispute to an arbitrator approved by the Commissioner. The determination of the Commissioner or of an arbitrator approved by the Commissioner shall be final. The cost of any mediation or arbitration shall be split equally by the parties.

(f) Expenses of recovery shall be the reasonable expenditures, including attorney's fees, incurred in effecting the recovery. Attorney's fees, unless otherwise agreed upon, shall be divided among the attorneys for the plaintiff as directed by the court. The expenses of recovery shall be apportioned by the court between the parties as their interests appear at the time of the recovery.

(g) Compensation benefits referred to in this section shall in each instance include but not be limited to all expenses incurred under sections 639 and 640 of this title.

(h) The injured employee or the employee's personal representative shall be prohibited from commencing a civil action to enforce liability against the workers' compensation insurance carrier for conducting workplace inspections, or an employer-employee safety committee except in the case of gross negligence or willful misconduct. The employee or the employee's personal representative shall have the burden of proving gross negligence or willful misconduct.

(i) The Commissioner, by rule, may require workers' compensation carriers to conduct periodic workplace inspections and to provide other safety related advice to their insureds.

(j) The Commissioner shall determine, by rule, workplaces where an insured has demonstrated an unusually poor safety record, as defined by the Commissioner.

(k) Employers with unusually poor safety records, as defined by the Commissioner, shall create workplace safety committees with balanced representation between management and employees and, with the assistance of the Department, shall design and implement written accident prevention plans that shall be distributed to all employees. The Department shall issue bulletins of best safety practices. (Amended 1959, No. 232; 1977, No. 182 (Adj. Sess.), § 2, eff. May 3, 1978; 1981, No. 165 (Adj. Sess.), § 1; 1993, No. 225 (Adj. Sess.), § 3; 1997, No. 140 (Adj. Sess.), § 2; 1999, No. 41, § 4; 2003, No. 132 (Adj. Sess.), § 15, eff. May 26, 2004; 2013, No. 199 (Adj. Sess.), § 65, eff. June 24, 2014; 2017, No. 74, § 39; 2017, No. 113 (Adj. Sess.), § 148.)