Main Page Not logged inLogin

For questions, changes or clarifications regarding the Workers' Compensation resources, please contact

Last Reviewed / Modified On 27 Apr 2017.

Alabama Worker's Compensation Claim Handling Guidelines

Contents [hide]

DEFINITIONS

Employer

The term employer is defined in Ala. Code§ 25-5-1(4) as ““Every person who employs another to perform a service for hire and pays wages directly to the person. The term shall include a service company for a self-insurer or any person, corporation, copartnership, or association, or group thereof, and shall, if the employer is insured, include his or her insurer, the insurer being entitled to the employer's rights, immunities, and remedies under this chapter, as far as applicable. The inclusion of an employer's insurer within the term shall not provide the insurer with immunity from liability to an injured employee, or his or her dependent in the case of death to whom the insurer would otherwise be subject to liability under Section 25-5-11. Notwithstanding the provisions of this chapter, in no event shall a common carrier by motor vehicle operating pursuant to a certificate of public convenience and necessity be deemed the "employer" of a leased-operator or owner-operator of a motor vehicle or vehicles under contract to the common carrier.”

When determining whether an employer-employee relationship exists, the courts will look to whether the purported employer has reserved the right to control the manner in which the worker performs the duties of the work. Susan Schein Chrysler Dodge, Inc. v. Rushing, 77 So. 3d 1203, 1208 (Ala. Civ. App. 2011)

Statutory Employer

The term “statutory employer” does not appear in the Alabama Workers’ Compensation Act. Alabama’s courts, likewise, have not used the term “statutory employer” except in reference to the immunity provided by the Alabama Workers’ Compensation Act

Employee or Worker

Employees or workers are defined by statute Ala. Code § 25-5-1(5) provides that employee or worker shall “include every person in the service of another under any contract of hire, express or implied, oral or written, including aliens and also including minors who are legally permitted to work under the laws of this state…”

Borrowed Servant

“When a general employer lends an employee to a special employer, the special employer becomes liable for workmen's compensation only if '(a) the employee has made a contract of hire, express or implied, with the special employer; (b) the work being done is essentially that of the special employer; and (c) the special employer has the right to control the details of the work. When all three of the above conditions are satisfied in relation to both employers, both employers are liable for workmen's compensation.'“ Pinson v. Ala. Power Co., 557 So. 2d 1236, 1237 (Ala. 1990)

Independent Contractor

As a general rule, independent contractors are not covered under the Alabama Workers’ Compensation Act. However, the test in determining whether an individual is an independent contractor or employee is the “right of control” test.

When determining whether an employer-employee relationship exists, the courts will look to whether the purported employer has reserved the right to control the manner in which the worker performs the duties of the work. Atchison v. Boone Newspapers, Inc., 981 So. 2d 427, 431 (Ala. Civ. App. 2007). Susan Schein Chrysler Dodge, Inc. v. Rushing, 77 So. 3d 1203, 1208 (Ala. Civ. App. 2011)

The factors to be considered in determining whether an individual or an entity has retained the right of control include: (1) direct evidence demonstrating a right or an exercise of control; (2) the method of payment for services; (3) whether equipment is furnished; and (4) whether the other party has the right to terminate the employment. See Ex parte Curry, 607 So. 2d 230 (Ala. 1992)." Susan Schein Chrysler Dodge, Inc. v. Rushing, 77 So. 3d 1203, 1208 (Ala. Civ. App. 2011)

Exclusions

The Alabama Workers’ Compensation Act does not normally apply to Employers of (1) domestic employees, (2) farm labor, (3) casual employees, (4) employers of less than five employees in any one business, or (4) municipalities having a population of less than 2,000. Ala. Code§ 25-5-50

EXCLUSIVE REMEDY

General Rule

The Alabama Workers’ Compensation Act is the exclusive remedy available to employees who sustain work-related injuries, illnesses, or diseases. Ala. Code§ 25-5-52 and 53 set forth the immunity provision for accidents and Ala. Code § 25-5-113 and 114 set forth the immunity provision of occupational diseases.

"The intent of the Legislature is to provide complete immunity to employers and limited immunity to officers, directors, agents, servants or employees of the same employer and to the workers' compensation insurance carrier and compensation service companies of the employer or any officer, director, agent, servant or employee of such carrier or company and to labor unions and to any official or representative thereof from civil liability for all causes of action except those based on willful conduct and such immunity is an essential aspect of the workers' compensation scheme." Ex parte Progress Rail Servs. Corp., 869 So. 2d 459, 465 (Ala. 2003). See also Ala. Code § 25-5-14.

Exceptions

Exceptions to the exclusivity provision of the Alabama Workers’ Compensation Act have been carved out for the following:

(1) the tort of outrage (Garvin v. Shewbart, 442 So. 2d 80 (Ala. 1983)),

(2) intentional fraud (Lowman v. Piedmont Executive Shirt Manufacturing Co., 547 So. 2d 90 (Ala. 1989)), or

(3) to "an employer's wrongful conduct [that] ... injures an employee's unborn child" (Namislo v. Akzo Chems., Inc., 620 So. 2d 573, 575 (Ala. 1993)).

The Alabama statute also contains a very narrow exception allowing certain claims to survive against co-employees. Co-employee liability is discussed in Ala. Code § 25-5-11.

Before 1985, co-employees and workers' compensation carriers could be civilly liable for personal injuries caused by their negligence or wantonness. In 1985, the legislature passed Act No. 85-41, which amended the Alabama Workers’ Compensation Act to bar claims against co-employees and workers' compensation carriers based on negligence or wantonness. Under Act No. 85-41, a co-employee or workers compensation carrier is liable only for willful conduct that results in injury or death to the employee. Barron v. CNA Ins. Co., 678 So. 2d 735, 737-38 (Ala. 1996)

JURISDICTION AND LIMITATIONS OF ACTIONS

General Rule

The Alabama Workers’ Compensation Act generally extends jurisdiction broadly to any employee who physically sustains a work injury in Alabama. 2 Terry A. Moore, Alabama Workers' Compensation § 30:32. Moore notes that Ala. Code § 25-5-35 “implies that all in-state injuries are covered”.

Courts

Alabama Circuit Courts have jurisdiction over workers’ compensation claims brought under the Alabama Workers’ Compensation Act. Ala. Code § 25-5-88. Alabama does not have a workers’ compensation tribunal. Cases are tried before the same judges that preside over criminal and civil actions and are governed by the same rules of civil procedure and evidentiary rules as civil actions.

Extraterritorial Jurisdiction

Injuries sustained outside of Alabama may be covered by the Alabama Workers’ Compensation Act.. The Act applies to injuries occurring outside the state of Alabama in the following instances:

(1) His employment was principally localized in this state;

(2) He was working under a contract of hire made in this state in employment not principally localized in any state;

(3) He was working under a contract of hire made in this state in employment principally localized in another state whose workmen's compensation law was not applicable to his employer; or

(4) He was working under a contract of hire made in this state for employment outside the United States. (Ala. Code § 25-5-35(d)) (See also Ex parte Tri-State Motor Transit Co., 541 So. 2d 557 (Ala. Civ. App. 1989), Morrisette v. Fluor Corp. (Ex parte Fluor Corp.), 960 So. 2d 701 (Ala. Civ. App. 2006))

Time Limitation

Alabama has time limitations for notice of an accident, discovery of an occupational disease, filing of suit. Written notice of a job-related injury is required so that an employer can make a prompt examination, provide proper treatment, and protect itself against simulated or exaggerated claims. (Ex parte Brown & Root, Inc., 726 So.2d 601 (Ala. 1998)). Although the statute requires written notice, actual knowledge has been deemed to suffice where the employer learns that the employee has sustained an accidental injury in the course of employment. (Ex parte Singleton, 6 So.3d 515 (Ala. 2008)).

5 Day Notice Rule

An employee is required to give written notice of an accident within 5 days. Ala. Code § 25-5-78. Alabama’s courts eliminated the written notice requirement if the employer had actual notice. (Goodyear Tire & Rubber Co. v. Long, 31 So. 3d 715 (Ala. Civ. App. 2009)). Failure to provide notice within five (5) days of the accident bars the employee from recovery of benefits from the date of accident until the date of notice, unless the employee shows good cause for the failure. Goodyear Tire & Rubber Co. v. Foreman, 551 So.2d 409 (Ala. Civ. App. 1989). “Good cause” includes physical or mental incapacity and fraud.

90 Day Notice Rule

Ala. Code § 25-5-78 also contains a notice provision that actually has teeth. It states that “notwithstanding any other provision of this section, no compensation shall be payable unless written notice is given within 90 days after the occurrence of the accident or, if death results, within 90 days after the death.” (Wal-Mart Stores v. Elliott, 650 So. 2d 906 (Ala. Civ. App. 1994))

Statute of Limitations

Accidents

Workers' compensation claims for injuries resulting from work-related accidents must be brought within two years of either: 1) the accident or 2) the date of the employer's last voluntary payment of compensation benefits resulting from the accident. If a claim is not filed before the applicable period expires, the claim is barred by the statute of limitations in the Act. Ala. Code 1975, § 25-5-80.

Death Claims

In case of death, all claims for compensation shall be forever barred unless within two years after death, when the death results proximately from the accident within three years, the parties shall have agreed upon the compensation under this article or unless within two years after the death one of the parties shall have filed a verified complaint as provided in Section 25-5-88. Ala. Code 1975 § 25-5-80; White v. Riley Constr., Inc., 745 So. 2d 877 (Ala. Civ. App. 1999)

Occupational Diseases

The date of the injury in an occupational disease case other than those involving radiation exposure or pneumoconiosis is the "date of the last exposure to the hazards of the disease in the employment of the employer in whose employment the employee was last exposed to the hazards of the disease. Ala. Code 1975, § 25-5-117; Edmonds Indus. Coatings, Inc. v. Lolley, 893 So. 2d 1197, 1206 (Ala. Civ. App. 2004). For purposes of pneumoconiosis and radiation, "the date of the injury" shall mean the date of the last exposure to the hazards of the disease in the employment of the employer in whose employment the employee was last exposed to the hazards of the disease in each of at least 12 months, within a period of five years prior to the date of the injury. Code of Ala. § 25-5-117

Medical Benefits

There is no statute of limitations on medical benefits. (Ex parte Tuscaloosa County., 522 So. 2d 782 (Ala. 1988))

Discovery Rule

Alabama’s courts adopted a judicial exception to the general rule that a claim is barred if not filed within two years of the date of the injury. Am. Cyanamid v. Shepherd, 668 So. 2d 26 (Ala. Civ. App. 1995). According to Shepherd, "'[t]he time period [of the statute of limitations] does not begin to run until the claimant, as a reasonable person, should recognize the nature, seriousness, and compensable character of his injury or disease. See also Walker v. Flagstar Enters., 981 So. 2d 1137, 1140 (Ala. Civ. App. 2007)

Extensions of Limitations Period

The two-year statute of limitations is extended or tolled when the Claimant receives compensation payments. Once expired, the statute of limitations may not be revived by the payment of disability benefits. Payment of medical benefits does not toll or extend the limitations period.

The statute of limitations may be tolled where the actions or representations by the employer, even though they are nonfraudulent or unintentional, mislead the employee and delay the filing of his or her workmen's compensation claim. Stewart v. Carter Realty Co., 518 So. 2d 122, 124 (Ala. Civ. App. 1987)

COMPENSABILITY

General Rule

The Alabama Workers’ Compensation Act provides compensation for personal injuries and occupational diseases that “arise out of’ the employment and occur “in the course of” the employment.

“Injury”Defined

“Injury by accident arising out of and in the course of the employment, and not a disease in any form, except an occupational disease or when a disease results naturally and unavoidably from the accident. Injury shall include physical injury covered either by carpal tunnel syndrome or other cumulative trauma disorder and breakage or damage to eyeglasses, hearing aids, dentures, or other prosthetic devices when injury to them is caused by an on-the-job injury to the body. Injury does not include a mental disorder or mental injury unless caused by some physical injury to the body.” Ala. Code 1975 § 25-5-1(9)

“Accident” Defined

“An unexpected or unforeseen event, happening suddenly and violently.” Section 25-5-1(7)

“Arising out of” Defined

The phrase "arising out of" involves the idea of a causal relationship between the employment and the injury. See Wiregrass Comprehensive Mental Health Clinic, Inc. v. Price, 366 So. 2d 725, 726 (Ala. Civ. App. 1978).

“In the Course of” Defined

"In the course of" refers to time, place, and circumstances. If an injury occurs within the period of his employment, at a place where he may reasonably be while he is reasonably performing the duties assigned, such injury may be said to have occurred in the course of his employment. See Wiregrass Comprehensive Mental Health Clinic, Inc. v. Price, 366 So. 2d 725, 726 (Ala. Civ. App. 1978)

Legal Causation

If a claimant establishes that an accident arose out of and in the course of employment, legal causation is established. Trinity Indus. v. Cunningham, 680 So. 2d 253, 259 (Ala. Civ. App. 1995)

Medical Causation

As a general rule, “legal causation” must be established first. See Trinity Indus. v. Cunningham, 680 So. 2d 253, 258 (Ala. Civ. App. 1995) (Once legal causation has been established, i.e., once it has been established that an accident arose out of and in the course of employment, medical causation must be established, i.e., that the accident caused the injury for which recovery is sought.)

Medical causation is concerned with whether the physical condition of the claimant has been changed by a trauma, stress, or exposure. 1 Terry A. Moore, Alabama Workers' Compensation § 10:31 (1998).

To establish medical causation, an employee must produce substantial evidence tending to show that the exposure to the risk or conditions was in fact a contributing cause of the injury. Medical causation may be established by lay testimony or by lay testimony coupled with medical testimony. Trinity Indus. v. Cunningham, 680 So. 2d 253, 260 (Ala. Civ. App. 1995)

Types of Injuries

Hernia

In order to recover for a hernia, the employee must prove that it resulted from an accident arising out of and in the course of the employment and must establish that there was an injury resulting in a hernia, that the hernia appeared suddenly and was accompanied by pain, that the hernia immediately followed an accident and did not exist prior to the accident. Ala. Code 1975 § 25-5-57(a)(6)a.

Occupational Disease

Occupational disease is compensable where the employee establishes it arose out of and in the course of the employment and resulted from the employment. Ala. Code 1975 § 25-5-110& 25-5-111. The "date of injury" for an occupational disease generally means "the date of the last exposure to the hazards of the disease in the employment of the employer in whose employment the employee was last exposed to the hazards of the disease. ArvinMeritor, Inc. v. Handley, 12 So. 3d 669, 681 (Ala. Civ. App. 2008)

Infectious Disease

Infectious diseases are covered under the definition of occupational disease, so long as there is “clear and convincing evidence” the disease is acquired as a direct result of the employment. The employee has the burden of proving a causal link between the employment and the disease.

Cardiovascular

Cardiovascular problems may be compensable injuries under the Alabama Workers’ Compensation Act.. Benefits have been awarded for heart failures, strokes, aneurysms, seizures, blood clots and other cardiovascular problems. (Associated Grocers of the S., Inc. v. Goodwin, 965 So. 2d 1102 (Ala. Civ. App. 2007)(heart failure), Ex parte Trinity Indus., 680 So. 2d 262 (Ala. 1996)(stroke)

In order to establish causation in a workers' compensation case where the injury is nonaccidental, meaning that the injury was not caused by a sudden and unexpected external event, a claimant must satisfy a two-part causation test by producing substantial evidence establishing both (a) legal causation and (b) medical causation. See City of Tuscaloosa v. Howard, 55 Ala. App. 701, 318 So. 2d 729 (Ala. Civ. App. 1975); and Ex parte Moncrief, 627 So. 2d 385, 388 (Ala. 1993) (citing Hammons v. Roses Stores, Inc., 547 So. 2d 883 (Ala.Civ.App. 1989)) ("for an injury to be compensable under the Workers' Compensation Act, the employee must establish both legal and medical causation"). Merely showing that there is a close spatial or temporal relationship between the injury and the place or time of the claimant's performance of his or her job is not in itself always sufficient to satisfy either of the two prongs of Alabama's workers' compensation nonaccidental injury causation test. Ex parte Trinity Indus., 680 So. 2d 262, 269 (Ala. 1996)

Psychological

In order for a psychological injury to be compensable under the Alabama Workers’ Compensation Act, it must be "produced [or] proximately caused by some physical injury to the body.” Ala. Code 1975 § 25-5-1(9). See Goolsby v. Family Dollar Stores of Alabama, Inc., 689 So. 2d 104 (Ala. Civ. App. 1996). Additionally, the physical injury need not be the sole cause of the psychological injury so long as it is a contributing cause of the psychological injury. Ex parte Vongsouvanh, 795 So. 2d 625 (Ala. 2000), Jim Walter Res., Inc. v. Riles, 903 So. 2d 118, 122-23 (Ala. Civ. App. 2004). There is no “mental/mental” in Alabama.

EXCLUSIONS AND DEFENSES

Intoxication/Impairment

“No compensation shall be allowed for an injury or death caused … by an accident due to the injured employee being intoxicated from the use of alcohol or being impaired by illegal drugs.” § 25-5-51, Code of Ala. (1975).

Proof: “A positive drug test conducted and evaluated pursuant to standards adopted for drug testing by the U.S. Department of Transportation in 49 C.F.R. Part 40 shall be a conclusive presumption of impairment resulting from the use of illegal drugs

Refusal of Drug Test: “No compensation shall be allowed if the employee refuses to submit to or cooperate with a blood or urine test as set forth above after the accident after being warned in writing by the employer that such refusal would forfeit the employee's right to recover benefits under this chapter.”

The employer bears the burden of proving that the accident causing the injury was proximately caused by the employee’s intoxication/impairment.

Willful Misconduct\Intentional Self-Inflicted Accident

“[N]o compensation shall be allowed for an injury or death caused by the willful misconduct of the employee”. Ala. Code 1975, § 25-5-51. The employer bears the burden of proving that the accident causing the injury was proximately caused by the employee's willful misconduct/intentional conduct.

Fraud

“No compensation shall be allowed if, at the time of or in the course of entering into employment or at the time of receiving notice of the removal of conditions from a conditional offer of employment, the employee knowingly and falsely misrepresents in writing his or her physical or mental condition and the condition is aggravated or re-injured in an accident arising out of and in the course of his or her employment.” Ala. Code 1975, § 25-5-51.

Willful Failure to Use Employer-Provided Safety Device

“[N]o compensation shall be allowed for an injury or death caused by … [the employee’s] willful failure or willful refusal to use safety appliances provided by the employer.” § 25-5-51, Code of Ala. (1975). For this defense, the term “willful” means the employee’s actions were conscious or deliberate. This defense does not require the employer to prove the claimant intended to violate a rule, or intended to cause injury.

The employer bears the burden of proving that the accident or injury was proximately caused by the employee’s misconduct proscribed by the defenses listed in § 25-5-51. These defenses, if successful, only eliminate the employee’s rights to recover “compensation” and do not relieve the employer / carrier of the obligation to provide otherwise reasonably necessary medical treatment.

Recreational/Social Activities

Accidents occurring during social events or recreational activities sponsored by the employer are generally not covered as falling within the scope of employment. Circumstances may present coverage issues, where there is evidence that attendance is compulsory or that some economic benefits is derived by the employer, other than improved employee moral or employee relations.

Going & Coming Rule

Generally, an accident, which occurs while an employee is travelling to or from work, is not deemed to have occurred within the scope of employment and is not covered. Exceptions arise where the trip includes some activity on behalf of the employer, as opposed to a purely personal trip to or from home. Issues such as payment of travel expenses and provision of a company vehicle may also affect the issue.

Deviation from Employment

An employee’s injury arises out of and in the course of his employment when it occurs within the period of the employee's employment, at a place where the employee may reasonably be and while the employee is reasonably fulfilling the duties of the employee's employment or engaged in doing something incident to it. See 25-5-1(8), Code of Ala. (1975). In the course of employment Refers to the time, place, and circumstances under which the accident took place. Arising out of involves a causal relationship between the employment and the injury; that is, the job performance was the cause and source of the injury.

Horseplay

Generally, an accident is not covered where an employee engages in horseplay and is injured. However, where an employee is injured due to the horseplay of others, in which they did not participate, the accident is generally covered.

Assaults

Generally, assaults based upon reasons purely personal to the attacker are not compensable. If the reason for the attack has any connection to employment activities, compensability may become an issue.

Offset for Pre-Existing Disability

If the degree or duration of disability resulting from an accident is increased or prolonged because of a preexisting injury or infirmity, the employer shall be liable only for the disability that would have resulted from the accident had the earlier injury or infirmity not existed. Section 25-5-58.

Refusal of Medical Treatment

If the injured employee refuses to comply with reasonable request for examination, or refuses to accept the medical service or physical rehabilitation, which the employer elects to furnish under this chapter, the employee’s right to compensation shall be suspended and no compensation shall be payable for the period of the refusal. Ala. Code 1975, § 25-5-77(b).

Refusal of Suitable Employment

If an injured employee refuses employment suitable to his or her capacity offered to or procured for him or her, he or she shall not be entitled to any compensation at any time during the continuance of the refusal, unless at any time, in the opinion of the judge of the circuit court of the county of his or her residence, the refusal is justified. Ala. Code 1975, § 25-5-57(e).

Last Injurious Exposure Rule

If a second injury contributes even slightly to the employee’s disability, then the employer at the time of the second injury (and the insurer with coverage for that second injury) is responsible for the workers’ compensation payments. ‘The characterization of the second injury as a new injury, an aggravation of a prior injury, or a recurrence of an old injury determines which insurer is liable.’ North River Ins. Co. v. Purser, 608 So.2d 1379, 1382 (Ala.Civ.App.1992).

If the second injury is a ‘new injury” or an ‘aggravation of a prior injury,’ then the carrier at the time of the second injury is liable for the resulting medical bills and disability payments. If, however, the second injury is a ‘recurrence’ of a prior injury, then the carrier at the time of the prior injury is liable for the resulting medical bills and disability payments. Ex parte Pike County Com’n, 740 So.2d 1080, 1083 (Ala. 1999)

BENEFITS

Calculation of Average Weekly Wage

The average weekly wage is based on the employee’s earnings, which are subject to federal income taxation and reportable on the Federal W-2 tax form during the fifty-two week period prior to the accident in question. Wages from other employment are not considered. If the period of employment is less than fifty-two weeks, the trial court may use a lesser period of earnings, provided that the result is fair to both parties. The gross wages figure is to be divided by the number of weeks actually worked. Where there is not an adequate period of earnings for the employee in question, the wages earned by a similarly situated employee during the same period may be used. Ala. Code 1975 § 25-5-1(6)

Fringe Benefits

Fringe benefits are included in the average weekly wage only if the employer has discontinued the benefit. "Fringe benefits" shall mean only the employer's portion of health, life, and disability insurance premiums. Ala. Code 1975 § 25-5-1(6).

Temporary Disability

Payments of compensation are to be made at the intervals that the earnings were payable, as nearly as possible, unless the parties otherwise agree. Temporary total disability (TTD) begins with the first day the injured employee is not paid in full. Temporary total disability is computed by multiplying 66 2/3% times the average weekly wage (AWW). Ala. Code 1975 § 25-5-57

If 66 2/3% of the average weekly wage is more than the maximum compensation rate, only the maximum compensation rate in effect at time of injury should be used. If 66 2/3 % of the average weekly wage is less than the minimum compensation rate in rate in effect at the time of the injury then the minimum compensation rate should be used. However, if the average weekly wage is less than the minimum in effect at the time of injury, then 100% of the average weekly wage should be used. (See tables from Alabama Department of Labor establishing maximum and minimum compensation rates and the effective dates, in Section 13 of this guide. http://labor.alabama.gov/docs/guides/wc_weeklywage.pdf )

Temporary Partial Disability

Temporary Partial Disability (TPD) is paid when an employee returns to work, with restrictions, to light duty or part-time. Temporary Partial Disability is paid at 66 2/3% of the difference in the employee’s earnings at the time of injury and the earnings in his restricted capacity. This compensation is paid during the period of disability but not beyond 300 weeks, subject to the maximum only in effect on date of injury. Ala. Code 1975 § 25-5-57.

Waiting Period

There is a three (3) day waiting period in the State of Alabama. Compensation is owed beginning on the fourth (4th) day of disability. When the injured employee is out twenty-one (21) days, the three (3) day waiting period is added to the first compensation payment due after the twenty-one (21) days. If the employee sustains an injury, and it is obvious lost time will exceed twenty-one (21) days, the three (3) day waiting period may be waived and compensation begun on the first day of disability. Ala. Code 1975 § 25-5-59.

Scheduled Injuries

Generally, Ala. Code 1975 § 25-5-57(a)(3)a.1-33 sets a schedule of benefits for the injury, amputation, or loss of use loss of various areas of the body, including the following:

1. For the loss of a thumb, 62 weeks.

2. For the loss of a first finger, commonly called the index finger, 43 weeks.

3. For the loss of a second finger, 31 weeks.

4. For the loss of a third finger, 22 weeks.

5. For the loss of a fourth finger, commonly called the little finger, 16 weeks.

6. The loss of the first phalange of the thumb or of any finger shall be considered as equal to the loss of one half of the thumb or finger, and compensation shall be paid at the prescribed rate during one half of the time specified above for the thumb or finger.

7. The loss of two or more phalanges shall be considered as the loss of the entire finger or thumb, but in no case shall the amount received for more than one finger exceed the amount provided in this schedule for the loss of a hand.

8. For the loss of a great toe, 32 weeks.

9. For the loss of any of the toes other than the great toe, 11 weeks.

10. The loss of the first phalange of any toe shall be considered to be equal to the loss of one half of the toe, and compensation shall be paid at the prescribed rate during one half the time prescribed above for the toe.

11. The loss of two or more phalanges shall be considered as the loss of an entire toe.

12. For the loss of a hand, 170 weeks.

13. For the loss of an arm, 222 weeks.

14. For the loss of a foot, 139 weeks.

15. Amputation between the elbow and wrist shall be considered as the equivalent to the loss of a hand, and amputation between the knee and ankle shall be considered as the equivalent of the loss of a foot.

16. For the loss of a leg, 200 weeks.

17. For the loss of an eye, 124 weeks.

18. For the complete and permanent loss of hearing in both ears, 163 weeks.

19. For the complete and permanent loss of hearing in one ear, 53 weeks.

20. For the loss of an eye and a leg, 350 weeks.

21. For the loss of an eye and one arm, 350 weeks.

22. For the loss of an eye and a hand, 325 weeks.

23. For the loss of an eye and a foot, 300 weeks.

24. For the loss of two arms, other than at the shoulder, 400 weeks.

25. For the loss of two hands, 400 weeks.

26. For the loss of two legs, 400 weeks.

27. For the loss of two feet, 400 weeks.

28. For the loss of one arm and the other hand, 400 weeks.

29. For the loss of one hand and one foot, 400 weeks.

30. For the loss of one leg and the other foot, 400 weeks.

31. For the loss of one hand and one leg, 400 weeks.

32. For the loss of one arm and one foot, 400 weeks.

33. For the loss of one arm and one leg, 400 weeks.

Disfigurement/Scarring

34. For serious disfigurement, not resulting from the loss of a member or other injury specifically compensated, materially affecting the employability of the injured person in the employment in which he or she was injured or other employment for which he or she is then qualified, 66 2/3 percent of the average weekly earnings for the period as the court may determine, but not exceeding 100 weeks. Ala. Code 1975 § 25-5-57(a)(3)a.34.

Permanent Partial Disability

Permanent partial disability (PPD) benefits are paid after an employee has reached maximum medical improvement for a period not to exceed 300 weeks (Caveat: successive compensable injuries) less payment of temporary total disability (TTD) benefits.

Permanent partial disability (PPD), scheduled or unscheduled injury, is subject to a maximum of $220.00 per week

Permanent partial disability (PPD) benefits are generally paid out over time. The employee may not require a lump sum payment unless the employer is in default on payments. Ala. Code 1975 § 25-5-86. If payments are made in a lump sum, future payments are reduced to present value on a six (6%) percent basis. Ala. Code 1975 § 25-5-83.

Impairment Ratings

A trial court is not bound to accept a physician's assigned impairment rating and is free to make its own determination as to an employee's impairment. Fuller v. BAMSI, Inc., 689 So. 2d 128, 131 (Ala. Civ. App. 1996).

Loss of Ability to Earn

An award of permanent partial disability benefits is based upon the employee’s reduced earning capacity proximately caused by the injury in question. The trial court has discretion in determining the impact of an accident and injury on earning capacity and may consider vocational evidence and testimony from vocational experts.

Return to Work at Same or Greater Wages

Where an employee returns to work earning at or above their pre-injury wage, the trial court may not consider vocational evidence. The worker's permanent partial disability rating shall be equal to his or her physical impairment. Ala. Code 1975 § 25-5-57(a)(3)i. The PPI rating and any permanent restrictions may be considered by the trial court on the issue of PPD. If the employee loses his job through no fault of his own within 300 weeks from the date of injury, or if returned to a job paying less than his pre-injury wage, he may petition for his vocational disability

Medical Impairment

The American Medical Association Guides to the Evaluation of Permanent Impairment, Fourth Edition, shall be the recommended guide used by physicians in determining impairment and/or disability ratings. Ala. Admin. Code, r. 480-5-5-.35. Medical impairment is not the same as physical impairment, however.

Vocational Rehabilitation

If the employer so elects, the employee shall submit to and undergo vocational rehabilitation at the employer’s expense. If an employee who is unable in the opinion of the treating physician to return to his/her former employment, requests vocational rehabilitation and both a vocational rehabilitation specialist and a treating physician express their opinion in writing that in their judgment, vocational rehabilitation is reasonably calculated to restore the employee to gainful employment and is in the best interest of the employee, the cost shall be borne by the employer. The costs, where rehabilitation requires residence at or near a facility or institution away from the employee’s customary residence, shall include reasonable charges for the employee’s necessary board, lodging, and travel. Ala. Code 1975, § 25-5-77(c)

Permanent Total Disability

Permanent Total Disability (PTD) does not mean total helplessness. Permanent Total benefits have no limitations on the amount or length of time of payment. If an injured employee is determined to be a permanent total, whereby, he is unable to obtain suitable or gainful employment as a result of the injury, he is entitled to PTD benefits for the remainder of his life so long as he remains disabled, or until he is gainfully employed through vocational rehabilitation. See Thompson & Co. Contractors v. Cole, 391 So. 2d 1042, 1046 (Ala. Civ. App. 1980)(The period of compensation for permanent total disability lasts only so long as the disability continues. Should the disability cease to be other than total at some future time, the compensation for permanent total disability could be terminated).

Permanent Total Disability means the inability to:

1. Perform one’s trade

2. Obtain other reasonable gainful employment

3. Perform gainful employment with reasonable accommodations, or

4. Be retrained for reasonably gainful employment.

See James River Corp. v. Franklin, 840 So. 2d 164 (Ala. Civ. App. 2002)

Permanent Total Disability is computed at 66 2/3 % of the average weekly wage, not to exceed the maximum in effect at the time of injury. Benefits are paid for duration of disability (lifetime benefits) but can be altered by vocational rehabilitation.

Death

Where death results proximately from the accident within three years, compensation is payable to dependents entitled thereto without administration or to a guardian or other person as the Court may direct, for the use and benefit of the person entitled thereto. Ala. Code 1975, § 25-5-60.

Death benefits are based on the employee’s average earnings at the time of the accident, subject to the maximum and minimum in effect at the time of accident. If the employee leaves one dependent, the dependent is entitled to 50% of the employee’s average weekly wage, subject to maximum and minimum. If the employee leaves two or more dependents, the dependents are entitled to 66 2/3% of the employee’s average weekly wage, subject to maximum and minimum in effect at time of injury resulting in death. Precedence of dependents is listed in Ala. Code 1975, § 25-5-62 and the amount/percentage is determined by the Court. Death benefits are payable for 500 weeks, subject to limitations such as remarriage of the widow, etc., as defined in Ala. Code 1975, § 25-5-61. Death benefits are only payable to United States resident. Ala. Code 1975, § 25-5-82. See also Duran v. Goff Grp., 23 So. 3d 45 (Ala. Civ. App. 2009).

Death Following Disability

If death follows a period of disability, the period of disability will be deducted from the 500-week period due the dependent(s). If an employee dies of causes not related to the injury, while receiving permanent partial disability or permanent total disability, the remaining compensation due is payable to his dependents if the degree of disability has been agreed upon by the parties or if a court has determined the degree of disability. Compensation payable to dependents shall not exceed the amount due, had the death resulted from the injury. In all death claims where the cause of death is obscure or is disputed, any interested party may require an autopsy, the cost of which is to be borne by the party demanding the autopsy. The 1992 Amendment provided for a $7,500.00 death benefit for an employee who has no dependents at the time of his death. Burial expenses up to $3,000.00 are payable to all employees whose death is the result of an accident or illness arising out of and in the scope of employment.

Medical Benefits

Medical treatment is generally governed by Section 25-5-77, which provides:

If the employee is dissatisfied with the initial treating physician selected by the employer and if further treatment is required, the employee may so advise the employer, and the employee shall be entitled to select a second physician from a panel or list of four physicians selected by the employer. Ala. Code 1975, § 25-5-77(a).

Under Alabama’s workers’ compensation laws, the employer selects the initial treating physician. If the employee is dissatisfied with that physician, the employee may request that the employer provide the employee with a list of four other physicians from which the employee chooses another treating physician. The employee may only receive one panel of four physicians. There is a distinction between physicians and surgeons such that an employee who has been prescribed surgery may request a separate panel of surgeon to review the surgical recommendation.

The plain language of the Ala. Code 1975, § 25-5-77 differentiates between physicians and surgeons. The Act allows an employee dissatisfied with the initial treating physician the right to request that the employer provide a panel of four new physicians from which the employee can select a replacement. As to surgeons, the Act states that an employee shall have a right to a panel of four different surgeons if surgery is needed and the employee is dissatisfied with the surgeon designated by the employer. Section 25-5-77(a) provides for both a panel of four physicians and, if surgery is required and the employee is dissatisfied with the surgeon designated by the employer, a panel of four surgeons.

Authorized Treating Physician

Where the employee has an authorized treating physician, the employee may not unilaterally seek treatment with another physician, even a previously authorized physician. The only procedure available to the employee is a request for a panel of four physicians pursuant to Section 25-5-25(a). The Act allows the employee only one request for a panel of four physicians, should the employee become dissatisfied with the physician chosen by the employer. The statute distinguishes between a panel of four physicians and a panel of four surgeons, when surgery is necessary.

Once an employer authorizes treatment for an employee by a particular physician and the employee is satisfied with the treatment provided by that physician, the employer loses its authority to withdraw its authorization for treatment by that physician. The authorized treating physician often refers the employee for additional treatment with another physician. Unless the previous authorized treating physician discharges the employee from his care or the employee expresses dissatisfaction and picks from a panel of four, referral by an authorized treating physician to another physician generally does not render the referring physician “unauthorized.”

The law does provide for instances in which the employee is justified in incurring medical treatment and expense without first obtaining the employer’s authorization:

1. Where the employer has neglected or refused to provide the necessary medical care.

2. Where the employer has consented to the selection by the employee.

3. Where notice of and request for alternative care would be futile.

4. Where other circumstances exist which justify the selection of alternative care by the employee

Reasonably Necessary Medical Treatment

The employer is responsible for “reasonably necessary medical” treatment. The Administrative Code defines medical necessity as:

Services or supplies which are medically necessary to treat the work related illness or injury. To be medically necessary, services and supplies shall meet the following criteria: be consistent with the diagnosis and treatment of the work related illness or injury; be consistent with the standard of care for good medical practice; not be solely for the convenience of the patient, family, hospital, physician or other provider; be in the most appropriate and cost effective medical care setting as determined by the patient’s condition; and have scientifically established medical value.

Ala. Admin. Code, r. 480-5-5.02.

Utilization Review

“Utilization review” is a process used to determine the medical necessity for medical and surgical in-hospital, outpatient, and alternative settings treatments for acute and rehabilitation care. It includes pre-certification for elective treatments. Concurrent review and retrospective review are required for emergency cases. The Utilization Review process is typically triggered when a physician, or another healthcare provider, prescribes a certain medical procedure or treatment that the employer, or more often the employer’s worker’s compensation insurance carrier, disputes as not being medically necessary.

Where an employer questions the reasonable necessity of an employee’s medical treatment, the employer may seek review of the proposed medical treatment following a process established in regulations promulgated by the Alabama Department of Industrial Relations, Workers’ Compensation Division, and set forth in Chapter 480-5-5 of the Alabama Administrative Code. The scope of Chapter 480-5-5 is stated in Ala. Admin. Code, r. 480-5-5-.01 as follows:

“These rules are designed to cover permissive bill screening and permissive utilization review undertaken on behalf of an employer by a person or entity other than an employee of the employer and following a determination that an employee has suffered an injury by accident arising out of and in the course of the employee’s employment. These rules are not to be interpreted as limiting the employer’s own prerogative.”

Chapter 480-5-5 sets forth two methods by which an employer may undertake review of proposed medical treatment: 1) pre-certification review and 2) utilization review. Pre-certification review is defined in Chapter 480-5-5 as “[t]he review and assessment of the medical necessity and appropriateness of services before they occur. Utilization review is defined in Chapter 480-5-5 as “[t]he determination of medical necessity for medical and surgical in-hospital, outpatient, and alternative setting treatments for acute and rehabilitation care. It includes pre-certification for elective treatments.” Ala. Admin. Code, r. 480-5-5-.02(68).

The employer has no obligation to pay for medical treatment, which the trial court determines, is not reasonably necessary. However, should a dispute arise as to whether certain medical treatment is medically necessary, the employer or the employer’s worker’s compensation insurance carrier must first invoke the Utilization Review process prior to seeking a judicial determination of the medical necessity of the treatment. The statutory requirements for the review process must be strictly and carefully followed.

If a claim for medical services rendered is disputed, notify the provider that the claim is in dispute and advise them of the nature of the dispute. This is crucial because medical providers can file a formal complaint with the Director of Industrial Relations. §25-5-77(i) states, “Any party, including a health care provider, is entitled to a review by an ombudsman of medical services provided or for which authorization of payment is sought if any party or health care provider has any of the following:

1. Been denied payment or had the charge reduced for medical services rendered.

2. Been denied authorization for payment of services requested or performed when authorization is required.

3. Been ordered by the Director to refund payments received for the provision of medical services.

4. A party to a medical dispute that remains unresolved after a review of medical services as provided by this section may petition the court for relief.

5. In any review under this subsection of medical services provided by a physician, any party to a dispute may request the ombudsman consult with an independent medical expert from a list of at least three names provided by the Workers’ compensation Medical Services Board in a medical specialty appropriate to the issues raised in the dispute and shall secure a written opinion from the independent medical expert. In rendering a decision or recommendation, the ombudsman shall give full consideration to the opinion of the independent medical expert, but shall not be bound by that opinion.

Medical Fee Schedule

The Workers’ Compensation Fee Schedule establishes and limits an employer’s liability for medical services to those set forth in the schedule. Employers may negotiate with providers for rates lower than those in the fee schedule. The Physician’s Fee Schedule is reviewed and updated each year by the Workers’ Compensation Medical Services Board. Information on the fee schedule may be found at http://labor.alabama.gov/wc/FeeSchedules.aspx

Medical Subrogation

An employer shall be allowed to subrogate medical and vocational benefit expenses recovered in a third-party suit. See Section 7 - Subrogation below.

Mileage Costs - Mileage costs to and from medical and rehabilitation providers shall be paid at the rate as provided by law for official state travel.

See http://labor.alabama.gov/docs/guides/wc_mileage_rate.pdf. Section 25-5-77(f).

Physician Defined

The term “physician” shall include medical doctor, doctor of osteopathy and chiropractor.

Communicating with the Medical Provider

The Alabama Workers’ Compensation Act specifically provides that an Employer and its workers’ compensation carrier may communicate directly with treating physician or medical provider. Ex parte Smitherman Bros. Trucking, Inc., 751 So. 2d 1232 (Ala. 1999)

Lifetime Medicals

The Employer and its Workers’ Compensation Insurance Carrier are responsible for reasonable and necessary medical expenses for treatment of an injury caused by a work related accident. The right to medical benefits remains available to the Employee without interruption due to the passage of time or gaps in treatment.

Medical Bills

Undisputed medical charges should be paid within 25 days from date of receipt. Ala. Code 1975, § 25-5-77(h). Medical providers have on year from date of service to submit medical bills.

Penalties

Penalties for Failure to Secure Payment of Compensation

An employer required to secure the payment of compensation under this section who fails to secure compensation shall be guilty of a misdemeanor, and upon conviction thereof, shall be subject to a fine of not less than $100.00 nor more than $1,000.00. In addition, an employer required to secure the payment of compensation under this section who fails to secure the compensation shall be liable for two times the amount of compensation which would have otherwise been payable for injury or death to an employee. The director may apply to a court of competent jurisdiction for an injunction to restrain threatened or continued violation of any provisions relating to the requirements of insurance or self-insurance. The court may impose civil penalties against an employer in noncompliance with this amendatory act, in an amount not to exceed $100.00 per day. Subsequent compliance with this amendatory act shall not be a defense. Ala. Code 1975, § 25-5-8

Penalties for Late Payment

If any installment of compensation payable is not paid without good cause within 30 days after it becomes due, there shall be added to the unpaid installment an amount equal to 15% thereof, which shall be paid in addition to the installment amount. The penalty provision is not frequently applied. Ala. Code 1975, § 25-5-59.

SUBROGATION OR CREDIT

General Rule

Ala. Code 1975, § 25-5-11 of the Act provides the employer/carrier with a statutory lien against any third party recovery had by the employee against any third party based upon the same accident made the basis of the workers’ compensation claim. The lien covers all benefits paid to or on behalf of the employee, including medical benefits. If the employee does not seek recovery from a liable third party within the two-year limitations period, the employer has an additional six-month period within which to file suit.

Attorney’s Fee

The employer has a first dollar right to reimbursement, subject to a pro-rata share of attorney fees and costs. Fitch v. Ins. Co. of N. Am., 408 So. 2d 1017 (Ala. Civ. App. 1981). Fitch set forth a formula, known as the “Fitch Formula” for calculating the employer’s liability for attorney’s fees. The formula provides: Employer's Reduced Liability / Third Party Recovery = X / Attorney's fees & expenses. X is the employer’s liability for attorney’s fees.

Employer’s reduced liability

Third party recovery

=

X

Attorney’s fees & expenses

Credits

The employer is entitled to an offset or credit against any future liability based upon the employee’s third party recovery. Ala. Code 1975, § 25-5-57(c).

(1) The employer may reduce or accept an assignment from an employee of the amount of benefits paid pursuant to a disability plan, retirement plan, or other plan providing for sick pay by the amount of compensation paid, if and only if the employer provided the benefits or paid for the plan or plans providing the benefits deducted.

(2) The employee shall forfeit to the employer all compensation paid for any period to which is attributed any award of back pay either by a court, administrative agency, arbitration, or settlement, provided, however, social security payments shall not be included herein.

(3) If an employer continues the salary of an injured employee during the benefit period or pays similar compensation during the benefit period, the employer shall be allowed a setoff in weeks against the compensation owed under this article. For the purposes of this section, voluntary contributions to a Section 125-cafeteria plan for a disability or sick pay program shall not be considered as being provided by the employer.

ATTORNEYS

Requirement for Attorneys

Attorneys must be licensed to practice law in the State of Alabama.

Attorney Fees

Attorney fees are established by statute at a maximum of fifteen (15%) percent of the compensation recovered. Generally, attorney fees may not be paid for recovery of medical benefits. Ala. Code 1975, § 25-5-90.

Attorney fees are not awarded on the recovery of medical expenses in a workers' compensation action, absent willful or contumacious conduct. Fort James Operating Co. v. Thompson, 871 So. 2d 44, 48 (Ala. Civ. App. 2002).

Attorney Fees deducted from Employee’s Portion

The employee/claimant is responsible for the payment of attorney fees and expenses as part of a settlement. The employer is not responsible for payment of attorney fees or costs. Fort James Operating Co. v. Thompson, 871 So. 2d 44 (Ala. Civ. App. 2002).

Lump Sum Fees

In cases where part of the judgment requires payment of future money over the course of weeks, the Court typically requires immediate payment of the full attorney fee in full, based on 15% of the accrued weeks plus 15% of the present day value of the future weeks. Ex parte St. Regis Corp., 535 So. 2d 160 (Ala. 1988)

Court Costs

Costs may be awarded by the trial court in its discretion. Ala. Code 1975, § 25-5-89. See also Ex parte Ellenburg, 627 So. 2d 398 (Ala. 1993).

CLAIMS PROFESSIONALS

Those handling claims in Alabama must be licensed and must obtain required annual continuing education (CE) credits by attending one of several officially sanctioned education seminars put on by the Alabama Department of Labor or by one of a limited number of private organizations. Ala. Code 1975, § 25-5-293; Ala. Admin. Code Rule 480-5-1-.06.

Details on state-sponsored education seminars are available at: http://labor.alabama.gov/WC

Details on Alabama Workers’ Compensation Organization seminars are available at: http://www.awcotoday.com/seminars_events.php

Details on Alabama Self Insurers Association seminars are available at: http://www.asiaal.org

LITIGATION AND APPEAL

Tribunal

Workers’ Compensation Claims are to be brought and heard in State Circuit Court. Ala. Code 1975, § 25-5-81.

Claims may also be brought, by voluntary agreement of both parties, before an Ombudsman with the Alabama Department of Labor for purposes of a “benefit review conference”.

Litigation of Claims

Lawsuit in State Circuit Court

Disputes between an employer and an employee or between the dependent of a deceased employee and the employer regarding compensation are to be decided in the circuit court in the county that would otherwise have jurisdiction over a civil action between the parties. Generally, this is the county in which the employee resides, any county in which the employer does business or the county in which the accident occurred. Either party may initiate the action by filing a properly verified complaint in circuit court. The required content of a complaint are set forth in [http://codes.lp.findlaw.com/alcode/25/5/3/25-5-88|Ala. Code 1975, § 25-5-88]]. The courts are generally lenient with enforcing the content requirements, provided sufficient information is contained to advise the other side of the nature of the lawsuit and are also lenient in allowing amendments. Venue may be transferred to a county with a greater interest in the subject of the litigation based upon location of the accident, the parties, and witnesses. Costs may be awarded in favor of the prevailing party, in the discretion of the trial court.

Benefit Review Conference before State Ombudsman

A dispute may be resolved in whole or in part at the benefit review conference conducted before an Ombudsman from the Department of Labor. The Ombudsman Program was established to assist injured or disabled employees, persons claiming death benefits, employers, and other persons in protesting their rights and obtaining information available under the Workers’ Compensation Law. Ombudsman may conduct benefit review conferences only with the agreement of both the employer and employee. A benefit review conference is a non-adversarial, informal dispute resolution process. Under this program the ombudsman is to:

1. Explain, orally and in writing, the rights of the respective parties and the procedures necessary to protect those rights;

2. Discuss the facts of the claim, review information to evaluate the claim, and delineate the issues; and

3. Mediate and resolve disputed issues.

Ombudsman Mediated Agreement

An agreement shall be effective on the date it is signed, unless one of the parties submits the agreement to the court for approval. An agreement shall be binding on all parties, unless within 60 days after the agreement is signed or approved the court on finding of fraud, newly discovered evidence or other good cause, shall relieve all parties of the effect of the agreement. Expenses of Ombudsmen are borne by the Workers' Compensation Division.

The services of the Ombudsmen are free to all parties. The Ombudsman toll free number is 1-800-528-5166.

Power of State Circuit Judge

The court may hear and determine controversies in a summary manner. The Court is required to file with the circuit clerk a statement of the law and facts and conclusions as determined by the judge. Ex parte Cowabunga, Inc., 67 So. 3d 136 (Ala. Civ. App. 2011)

The decision of the judge shall be conclusive and binding upon the parties, subject to the right of appeal. Circuit court judges have broad discretion in their decisions, which are generally only subject to reversal where there is a mistake of law or where the decision is not supported by sufficient evidence. The determination of a trial judge on an issue of disputed fact is generally not subject to reversal.

Appeals

A party who wishes to take an appeal from a final order entered by a Circuit Court shall do so by filing a Notice of Appeal to the Alabama Court of Civil Appeals. Such notice must be filed within forty-two (42) days from the date of entry of the order from which the appeal is taken. Any obligation for the payment of benefits imposed by the order from which an appeal is taken must be secured by a supercedeas bond equal to 125% of the amount then due and owing under the order.

Appeals from the Alabama Court of Appeals may be taken to the Alabama Supreme Court.

SETTLEMENT

Settlements in General

Ala. Code 1975, § 25-5-56 of the Act specifically provides for the parties to enter into a settlement of any and all portions of a workers’ compensation claim, including medical benefits. Settlement must be in an amount at least equal to the amount of benefits provided for under the statutory formulas in the Act. The advance payment of benefits is without prejudice and shall not be construed as an admission of liability.

Approval of Settlements

Settlements for less than the amount provided for under the terms of the Act must be approved by the Court. Although not technically required by statute, the prevailing view in Alabama is that settlements should be Court approved. Settlements may also be approved by an Ombudsman from the Alabama Department of Labor. Ala. Code 1975, § 25-5-290.

INSURANCE

General Rule

An employer may secure its workers’ compensation liability by purchasing and maintaining insurance coverage through an insurance company, risk pool, or self-insured group, provided the contract and business plan have been approved by the Alabama Department of Insurance. Ala. Code 1975, § 25-5-8. An employer may also self-insure by establishing to the satisfaction of the Alabama Department of Labor the financial resources and ability to satisfy its liability for benefits, including sufficient net worth of at least $5 Million, demonstrated financial strength through positive net income during prior three years, and balance sheet. Ala. Code 1975, § 25-5-8.

Failure to Secure Coverage

An employer required to secure the payment of compensation who fails to secure compensation shall be liable for two times the amount of compensation which would have otherwise been payable. An employer who fails to properly secure coverage shall also be guilty of a misdemeanor. Ala. Code 1975, § 25-5-8

MISCELLANEOUS

Employee Fraud

In 1994, the Legislature of Alabama passed Act 94-653 which made workers’ compensation fraud a Class C felony. The Act states:

“Any person who makes or causes to be made any knowingly false or fraudulent material statement or material representation for the purpose of obtaining compensation as defined in Section 25-5-2(1), Code of Alabama, 1975, as amended, for himself or herself or any other person is guilty of a Class C felony.”

“Any person” has been interpreted to mean not only the employee, but a medical provider, attorney, employer, or any other person who may have an interest in the case. This Act will not eliminate fraud but it will be a deterrent for some employees. The penalty, if convicted of a Class C felony, is one to ten years imprisonment and up to a $5,000 fine. After an investigation is completed by the employer or agent, the case will be reported to the District Attorney in the county where the fraud occurred, or to the Attorney General’s office.

State Maximum and Minimum Compensation

The Alabama maximum and minimum compensation rates are established July 1 of every year. The schedule published July 1, 2013 is below:

Weekly Compensation
Calendar Year State’s AWW Effective Date Maximum Minimum
1998 $510.17 7-1-99 $510 $140
1999 $530.93 7-1-00 $531 $146
2000 $548.74 7-1-01 $549 $151
2001 $568.51 7-1-02 $569 $156
2002 $587.06 7-1-03 $587 $161
2003 $607.10 7-1-04 $607 $167
2004 $629.48 7-1-05 $629 $173
2005 $651.23 7-1-06 $651 $179
2006 $682.09 7-1-07 $682 $188
2007 $705.68 7-1-08 $706 $194
2008 $729.04 7-1-09 $729 $200
2009 $740.14 7-1-10 $740 $204
2010 $755.46 7-1-11 $755 $208
2011 $770.80 7-1-12 $771 $212
2012 $787.59 7-1-13 $788 $217
2013        

http://labor.alabama.gov/docs/guides/wc_weeklywage.pdf

Reporting Requirements

Report to the Alabama Department of Labor – Workers’ Compensation Division

The Alabama Department of Labor requires a number of forms to be filed during the course of a claim. These forms are available for download from the Department of Labor website (http://labor.alabama.gov/wc). The specific deadlines for filing the forms will often depend on what happens in a particular claim, and when. As a general rule, however, you can plan to begin filing your forms within the first 30 days of the claim. Notable filing requirements include:

A. For all claims:

1. First Report of Injury (Form WC 2), must be filed within 15 days of the date of notice

2. Section A of the Supplementary Report (Form WC 3), must be filed within ten days of the date of first payment of compensation after the initial claim (or within 10 days of the date of first payment after previous payments were stopped or interrupted for any reason).

B. For claims where compensation is not being paid:

1. Section B of the Supplementary Report (Form WC 3) must be filed within ten days of the expiration of a thirty-day period of nonpayment of compensation after the employer has knowledge of a claim.

2. The Claim Summary Form (Form WC 4) must be filed within ten days of cessation or suspension of compensation payments for any reason.

Contacting the Alabama Department of Labor

Alabama Department of Labor
Workers' Compensation Division
649 Monroe Street
Montgomery, Alabama 36131
(334) 242-2868
1-800-528-5166
http://labor.alabama.gov/wc

^ Back to Top