When Can You Sue Outside of Workers’ Compensation for a Workplace Injury?
North Carolina’s workers’ compensation laws are designed to provide employees with a streamlined method of receiving benefits after a workplace injury. This system allows injured employees to recover medical expenses, partial wage replacement, and compensation for any resulting disability without having to prove their employer was negligent. The idea is to provide prompt and predictable relief while also limiting lawsuits against employers.
While workers’ compensation provides vital protection for employees, there are situations where an injured worker may also have the right to bring a civil lawsuit outside that system. Understanding when this is possible can make a significant difference in the compensation and justice you receive.
When you file a workers’ compensation claim, you generally give up the right to sue your employer directly for damages related to the injury. This trade-off—known as the “exclusive remedy rule”—is at the center of workers’ compensation law. The employer agrees to provide coverage, and in return, the employee’s recovery is limited to the benefits defined by statute.
At Cannon Law Offices, PLLC, we frequently encounter individuals in Greenville, North Carolina, who believe that a work-related injury automatically means their only legal remedy is through workers’ compensation. Our firm has represented injured workers and their families since 1983.
Let's explore how workers’ compensation functions under North Carolina law, when exceptions apply, and what steps you can take if another party is legally responsible for your injury.
Exceptions to the Exclusive Remedy Rule
Under the North Carolina workers’ compensation law, most injuries that happen in the course and scope of employment must go through the system. Yet, several important exceptions exist.
Here are some of the most common situations where an injured worker might pursue a civil lawsuit instead of, or in addition to, a workers’ compensation claim:
Intentional conduct by the employer – If an employer deliberately acts in a way that causes an employee harm, a lawsuit may be possible. While accidents are generally covered by workers’ compensation, intentional harm is not. For example, if an employer knowingly orders an employee to perform a dangerous act that is virtually certain to cause injury, this could open the door to a personal injury claim.
Injuries caused by a third party – One of the most common exceptions occurs when a third party (someone other than your employer or co-worker) is responsible for the injury. For instance, if you’re driving for work and another driver hits you, you could file a personal injury lawsuit against that driver in addition to seeking workers’ compensation benefits.
Defective products or equipment – If your injury is caused by a defective tool, machine, or piece of equipment, you may have a product liability claim against the manufacturer. This type of lawsuit is separate from your workers’ compensation benefits and can cover pain and suffering or other damages not available through the workers’ system.
Toxic exposure – Exposure to harmful chemicals or unsafe substances can lead to severe health conditions. If the manufacturer or supplier of those materials acted negligently, you might have grounds for a civil claim beyond workers’ compensation.
Non-subscribers – Although rare, if an employer fails to carry the required workers’ compensation insurance, the employee may sue the employer directly for damages, and the employer loses many of the legal protections usually granted under North Carolina workers’ compensation law.
Each of these situations requires careful evaluation to determine whether you can step outside the workers’ compensation system.
How Lawsuits Differ from Workers’ Compensation Claims
One significant difference between workers’ compensation and a civil lawsuit is the type of damages available. Workers’ compensation typically covers medical expenses, rehabilitation costs, and partial wage loss. It doesn’t include damages for pain, suffering, emotional distress, or punitive damages.
In contrast, a lawsuit allows you to seek compensation for both economic and non-economic losses. You can pursue full recovery for lost wages, future loss of income, pain and suffering, and, in some cases, punitive damages designed to punish especially wrongful conduct.
Because of this, an injured worker who qualifies to sue outside of workers’ compensation may have access to a much broader range of financial recovery.
Third-Party Liability and Workplace Injuries
Third-party liability claims are among the most frequent exceptions under North Carolina workers’ compensation law. A third-party claim arises when someone other than your employer or a co-worker contributes to your injury. This could include:
Contractors or subcontractors working on the same job site.
Manufacturers of defective machinery or tools.
Drivers who cause car accidents while they’re on the job.
Property owners who fail to maintain safe premises where work is being performed.
When a third-party lawsuit is filed, the workers’ compensation insurer may have a lien on any recovery from that lawsuit. This means that part of the settlement or verdict could be allocated toward reimbursing the insurer for benefits already paid. However, you may still come out ahead since third-party cases allow for additional damages not covered by workers’ compensation.
Intentional Misconduct and Gross Negligence
North Carolina law generally protects employers from direct lawsuits by employees for workplace injuries; however, this protection disappears when intentional misconduct is involved.
This doesn’t just mean accidents caused by negligence—it refers to situations where the employer knew that injury was substantially certain to occur and disregarded that risk.
In these cases, the employee can sue for damages outside workers’ compensation, and courts have recognized claims where safety violations were so severe that they amounted to intentional wrongdoing. These lawsuits often involve dangerous machinery, unsafe working environments, or failure to address known hazards.
Independent Contractors and Workers’ Compensation
Not everyone injured while performing work in North Carolina qualifies as an employee under workers’ compensation law. Independent contractors are generally excluded unless they are misclassified. When an independent contractor suffers a workplace injury, the absence of workers’ compensation coverage means that the only option may be a personal injury lawsuit.
However, misclassification of workers is a common issue. If someone is treated like an employee in practice—meaning the employer controls the work conditions, hours, or tools used—they may actually qualify for workers’ compensation coverage. In those cases, determining whether workers’ compensation or a lawsuit applies depends heavily on the facts.
Filing Deadlines and Legal Strategy
Every workers’ compensation claim and third-party lawsuit is subject to time limits, known as statutes of limitations. Under the North Carolina workers’ compensation law, employees typically have two years to file a claim for benefits.
Personal injury claims against third parties usually have a three-year statute of limitations, and missing deadlines can forfeit your right to recover. Acting promptly after an injury is essential, as evidence can fade, witnesses may become difficult to find, and key records could be lost. Taking swift action allows both your workers’ compensation claim and any potential lawsuit to move forward smoothly.
How Cannon Law Offices, PLLC Assists Injured Workers
At Cannon Law Offices, PLLC, we help injured workers understand all their options under North Carolina workers’ compensation law. We believe in protecting workers’ rights while exploring every possible path to full compensation. Our approach to workers’ compensation cases emphasizes clear communication and thorough case evaluation. We review how the injury occurred, identify potentially liable third parties, and assess whether exceptions to the exclusive remedy rule apply. We strive to help workers secure fair compensation for both immediate medical needs and long-term financial security.
Why Legal Guidance Matters
Because workers’ compensation and personal injury law intersect in these situations, the outcome often depends on understanding both systems. Pursuing a third-party claim while receiving workers’ compensation benefits involves coordination to avoid conflicting claims or double recovery.
Workers often face challenges such as employers disputing whether an injury is work-related, insurers delaying benefits, or third parties denying responsibility. Having legal representation can help make sure all possible claims are properly presented and pursued under North Carolina workers’ compensation law.
Reach Out to an Experienced Workers’ Compensation Lawyer Today
For most workplace injuries in North Carolina, workers’ compensation offers the primary avenue for recovery. However, when someone else’s negligence or intentional act contributes to your harm, a lawsuit may be an additional and powerful remedy.
At Cannon Law Offices, PLLC, we are committed to helping injured workers understand their rights under workers’ compensation law and beyond. Whether through a workers’ compensation claim, a third-party lawsuit, or both, we strive to secure the compensation our clients deserve for the physical, emotional, and financial toll of workplace injuries.
Understanding your rights is the first step toward recovery. If you believe your injury might involve more than just a workers’ compensation claim, we encourage you to learn about your options and take action before critical deadlines pass.
Through clear guidance and dedicated advocacy, we help you pursue justice in every way available under North Carolina workers’ compensation law. We’re proud to serve Greenville, North Carolina, and the surrounding areas. Call today for trustworthy legal representation in your workers' compensation case.