ISSUE: Future Landmark Cases – Concurrent Jurisdiction

Jack_crop 72dpiI’ve talked about dual, or concurrent, USL&H/state act workers’ compensation jurisdiction here several times, and most recently I discussed the U.S. Supreme Court’s landmark Sun Ship decision.  This was the decision that established that the 1972 Amendments to the Longshore Act supplemented but did not supplant state workers’ compensation laws, firmly establishing concurrent jurisdiction.

I’ve also listed the various “concurrent” and “exclusive” states several times.  Here is my unofficial list of the “concurrent” states: AL, AK, CA, CT, DE, GA, IL, MA, ME (?), MI, MN, MO (?), NC, NY, RI, SC, TN, WV, WI.   As you can see there are quite a few significant maritime states on the list.

Let’s renew the discussion of concurrent jurisdiction and take as our starting point the following assumptions, 1) concurrent USL&H/state act jurisdiction is a fact in many states, and, 2) concurrent jurisdiction is a problem for maritime employers.

It is self evident that having to comply with two different regulatory schemes for worker injuries entails inefficiencies and extra costs for the employer.  For an American maritime industry that competes internationally in ship building/repair and cargo handling, it is not a stretch to say that concurrent jurisdiction increases costs and is a negative element in the competitive balance.

Note:  I know that section 3(e), added as part of the 1984 Amendments to the Longshore Act, states that, “… any amounts paid to an employee for the same injury, disability, or death for which benefits are claimed under this Act pursuant to any other workers’ compensation law … shall be credited against any liability imposed by this Act.”

This credit provision doesn’t begin to address the additional costs to the employer due to overhead, administration, and expense items, and sometimes even redundant benefits necessitated by concurrent jurisdiction.

This is a straightforward issue of federal preemption if the proper case can reach the U.S. Supreme Court. Unfortunately, the context for this issue is decades of jurisprudential confusion over the limits and scope of federal Admiralty authority as opposed to the authority of the individual states.

Let’s look at a very brief history.

1789 – The U.S. Constitution recognizes the need for uniformity in certain areas so that national commerce can function without local interference, as expressed in the Admiralty Clause (Art. III, Sec. 2), the Interstate Commerce Clause (Art. I, Sec. 8), and the Supremacy Clause (Art. VII).

1873 – The U.S. Supreme Court stated (referring to the Admiralty Clause in its decision in The Lottawanna, 88 U.S. 558):

“It certainly could not have been the intention to place the rules and limits on maritime law under the disposal and regulation of the several States, that would have defeated the uniformity and consistency at which the Constitution aimed on all subjects of the commercial character effecting (sic) the intercourse of the States with each other or with foreign states.”

1910 – 1920 – the states pass workers’ compensation laws providing a remedy for workers injured in the course and scope of employment, in which the workers give up their right to sue for workplace injuries and accept a no fault statutory system of benefits.

1917 – The U.S. Supreme Court’s decision in Southern Pacific Co. v. Jensen, (244 U.S. 205) holds that the coverage of the new state workers’ compensation laws stops at the water’s edge   This decision creates the “Jensen Line” and in the process exposes a gap in workers’ compensation protection for land based employees working over the water.  The case involved a longshoreman injured on a gangplank over the water.

From the Supreme Court in Jensen:

“Article 3, 2, of the Constitution, extends the judicial power of the United States ‘to all cases of admiralty and maritime jurisdiction;’ and article 1, 8, confers upon the Congress power ‘to make all laws which shall be necessary and proper for carrying into execution the foregoing powers and all other powers vested by this Constitution in the government of the United States or in any department or officer thereof.’ Considering our former opinions, it must now be accepted as settled doctrine that, in consequence of these provisions, Congress has paramount power to fix and determine the maritime law which shall prevail throughout the country” (quoting from Butler v. Boston & S.S.S. Co., 130 U.S. 527).

Also from Jensen:

“If New York can subject foreign ships coming into her ports to such obligations as those imposed by her Compensation Statute, other states may do likewise.  The necessary consequence would be destruction of the very uniformity in respect to maritime matters which the Constitution was designed to establish; and freedom of navigation between the states and with foreign countries would be seriously hampered and impeded.”

1927 – In response to the Jensen decision, the Longshoremen’s and Harbor Workers’ Compensation Act is passed.  It is a federal workers’ compensation law which covers injuries occurring over the water or on a dry dock.

1927 – 1972 – a period of “impenetrable confusion” ensues as the courts try to reconcile state act workers’ compensation jurisdiction with the coverage of the federal Longshoremen’s Act.

1972 – Amendments to the Longshoremen’s Act move coverage landward for employees engaged in maritime employment in certain enumerated sites and other adjoining areas customarily used for maritime employment.

1980 – The Sun Ship decision by the U.S. Supreme Court confirms concurrent Longshore Act/state act jurisdiction.  This case involved injuries on land to ship repair workers.

1984 – When the Longshore Act is again amended Congress considers but fails to include language to end concurrent jurisdiction.

2016 – Many states have amended their state insurance laws to create exclusive as opposed to concurrent jurisdiction.  These amendments typically provide that if a worker is covered by the Longshore Act then he is not covered by the state act workers’ compensation law.  The problem of concurrent (dual) jurisdiction remains, however, in the many states that have not adopted these types of “exclusive” laws.

Note:  The Jensen decision is still good law.  It has been ignored on occasion and marginalized on occasion but it has never been overruled.

What we need is for a suitable case to somehow find its way to the U.S. Supreme Court so that the Court can reaffirm the Constitutional principle that for injuries over the water, whether to longshoremen, shipbuilders, ship repair workers, or any other workers for that matter, the Longshore Act preempts state workers’ compensation laws.  Period, End of sentence.

This will not be a complete resolution of the concurrent jurisdiction problem, but it will be a step in the right direction.  The next step, to get the Supreme Court to overrule Sun Ship and uphold Longshore Act preemption in all cases involving maritime employment, will admittedly be more difficult.  But there are valid preemption arguments in support of such a decision.  The first step, however, is to get Jensen unequivocally reaffirmed.

This issue is in need of a landmark decision at the U.S. Supreme Court.

John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation.  Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

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