The Employer's Legal Resource: Oklahoma's New Workers' Compensation Act Drastically Changes Landscape For Retaliation Lawsuits

09.03.13

In May, Governor Mary Fallin signed Oklahoma Senate Bill 1062, enacting into law the Administrative Workers' Compensation Act (the "Administrative Act"). The Administrative Act significantly changes how Oklahoma workers are compensated for on-the-job injuries. It changes the workers compensation system from a judicial system to an administrative system. It also allows employers to completely opt out of the workers' compensation system, as long as they provide equal benefits to injured workers.

In addition to changing how injured workers are compensated, the Administrative Act drastically changes the procedures for workers' compensation retaliation lawsuits.

The Administrative Act still makes it illegal for an employer to discriminate or retaliate against an employee when the employee has, in good faith, filed a workers' compensation claim, retained a lawyer for representation regarding a claim, instituted or caused to be instituted a proceeding under the Act or testified or is about to testify in a proceeding under the Act. It also still makes it illegal to discharge an employee during a period of temporary total disability ("TTD") for the sole reason of being absent from work or for the purpose of avoiding payment of TTD benefits to the injured employee.

However, employees no longer have the right to pursue their claims in district courts. The Administrative Act gives exclusive jurisdiction to hear and decide workers' compensation retaliation claims to the Oklahoma Workers' Compensation Commission, a newly created executive agency of the State. The Commission will consist of full-time commissioners appointed by the Governor and administrative law judges appointed by the commissioners. The Administrative Act also limits the damages that an employee may attempt to recover. Under the Administrative Act, employees may only be awarded back pay up to a maximum of $100,000. The Administrative Act precludes the recovery of punitive or consequential damages. Under the previous law, plaintiffs could recover an unlimited amount of back pay and, in addition to back pay, punitive damages up to $100,000. The Administrative Act also, unlike the previous law, does not require employers to reinstate successful plaintiffs. Under the previous law, some courts held that successful plaintiffs could recover awards for front pay and emotional distress damages. These damages are excluded by the Administrative Act. The Administrative Act does state that the prevailing party, either plaintiff or employer, shall be entitled to costs and attorneys’ fees. Attorneys' fees and costs were not awarded under the previous law.

The Oklahoma Administrative Workers' Compensation Act goes into effect on February 1, 2014. The Administrative Act will not be retroactively applied and will only apply to claims that arise on or after February 1, 2014.

The Administrative Act may be good news for Oklahoma employers in that it will limit their exposure for back pay, front pay, punitive, and other forms of damages. However, employers who are found to have violated the law may be on the hook for a successful plaintiff's attorney's fees and costs and that can be quite expensive. Oklahoma employers must be diligent to ensure that injured workers are not retaliated against.

By Kenneth T. Short, kshort@dsda.com

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Rebecca D. Bullard

Rebecca D. Bullard

Rebecca represents clients primarily in labor and employment
litigation and counsels clients regarding everyday employment matters. 

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