Can I Get Workers' Comp and Sue My Employer at the Same Time in NJ?

Generally, no. New Jersey's workers' compensation system is the "exclusive remedy" for a workplace injury, which normally bars employees from suing their employer directly in civil court. However, that rule generally only applies to your direct employer. If a third party, such as an equipment manufacturer, a subcontractor, or another company on a job site, contributed to your injury, you may be able to pursue a separate lawsuit against that party while your workers' comp claim moves forward at the same time.

What Is the "Exclusive Remedy" Rule in New Jersey?

Under N.J.S.A. 34:15-8, the New Jersey Workers' Compensation Act provides the exclusive remedy for an employee injured on the job, meaning that accepting workers' comp benefits generally means giving up the right to sue your employer in civil court for the same injury. This trade-off is central to how the system works: employees get benefits regardless of fault, and in exchange, employers are shielded from most personal injury lawsuits by employees.

When CAN You Sue Your Employer Directly?

New Jersey courts recognize a narrow "intentional wrong" exception to the exclusive remedy rule. Based on the New Jersey Supreme Court's decision in Laidlow v. Hariton Machinery Co., Inc., this exception generally requires showing that the employer knew with substantial certainty that the specific injury would occur, and not just that the employer was careless or even violated safety regulations. 

Courts have applied this standard narrowly, so it covers only the most extreme cases of employer misconduct. A separate, narrow exception can also apply if an employer failed to carry required workers' compensation insurance at all.

What Is a Third-Party Claim?

A third-party claim is a lawsuit against someone other than your employer whose negligence contributed to your injury. Because these claims are against parties other than your employer, they fall outside the exclusive remedy bar and can proceed alongside your workers' comp claim. Three scenarios come up most often:

• Defective equipment or machinery. If a tool, machine, or piece of equipment malfunctions or is defectively designed or manufactured, and that defect caused or contributed to your injury, you may have a product liability claim against the manufacturer, distributor, or in some cases a company that maintained or serviced the equipment. This is separate from whether your employer used or maintained the equipment properly. Workers hurt by malfunctioning power tools, industrial machinery, or safety equipment that failed to perform as designed often fall into this category.
• Negligent subcontractors on a construction site. Construction sites typically involve multiple employers working side by side: a general contractor, several subcontractors, and their respective crews. The workers' comp exclusive remedy generally only protects your own direct employer. If a different subcontractor's crew, or the general contractor itself, created a hazard (such as an unguarded excavation, improperly secured scaffolding, or debris left in a walkway) that caused your injury, you may be able to bring a claim against that other company even though a workers’ comp claim against your own employer is also proceeding.
• Negligent drivers in a work vehicle accident. If you were injured in a car accident while driving for work, whether making a delivery, traveling between job sites, or running a work errand, the driver who caused the crash is a third party separate from your employer. That driver's own insurance (and potentially his/her UM/UIM coverage) may provide a separate source of recovery beyond your workers' comp benefits.

Can You Collect Workers' Comp AND a Third-Party Settlement?

Yes, generally. A workers' compensation claim against your employer's insurer and a third-party lawsuit against a separate at-fault party can proceed at the same time, since they're legally distinct claims against different parties. One important wrinkle is that if you recover money from the third party, your workers' comp carrier is entitled to reimbursement (called a subrogation lien) for benefits it already paid to you or paid on your behalf, under N.J.S.A. 34:15-40, out of that third-party recovery. This coordination is fact-specific and worth reviewing with an attorney.

Frequently Asked Questions

What if I was hurt by a coworker's negligence?

Injuries caused by a coworker acting within the scope of employment are generally still excluded under the exclusive remedy rule, meaning your workers' comp claim may be the only avenue of recovery, rather than a lawsuit against the coworker.

Does workers' comp cover injuries from defective equipment?

Yes, workers' comp generally covers a work injury regardless of what caused it, including defective equipment.  That said, if the equipment was manufactured negligently, you may also be able to pursue a third-party product liability claim against the manufacturer in addition to your workers’ comp claim.

What's a subrogation lien?

A subrogation lien is a workers' comp insurance carrier’s right to be reimbursed, out of a third-party settlement or verdict, for the benefits it already paid out for the same injury. It doesn't prevent you from pursuing a third-party claim, but it does affect how any recovery gets divided.

Does it matter if I was an independent contractor rather than an employee?

Whether workers' compensation applies at all often depends on your classification as an employee versus an independent contractor, which can be a disputed, fact-specific question in its own right.

Can I sue a subcontractor if I work for the general contractor (or vice versa)?

Yes, potentially, since - in multi-employer worksites like construction sites, the exclusive remedy bar generally applies only to your direct employer.  Therefore, claims against other contractors or subcontractors on the same site are often possible third-party claims.

If you've been hurt and have questions about your rights, contact Levinson Axelrod, P.A. for a free, no-obligation case review.

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