Accidents at work are brought about by countries’ economic development and industrial activities. It exists in traditionally industrialized countries like in the EU, the US, Japan, etc. and newly developed countries like China.
Historically, accidents at work begun to be regulated in France in late 19th century. The act of April 9, 1898 first provided for employers’ limited strict liability. Later, recovery was instead granted by Social Security to all those who were injured while performing the job regardless of any establishment of liability on the part of their employers. The risk run by workers as a result of the performance of their job in industries supported the idea of granting of such compensation for any resulting injury. Employers were required to contribute to the program.
The trade-off for compensation was that employees could not claim additional damages from their employers who were then excused from such liabilities.
This is similar to “workers’ compensation” in the US (with the important exception in France that uncompensated workers may still be entitled to recover some benefits -medical bills and lost wages- from Social Security like anyone else who gets sick or disable). However, this is different from other EU countries (the UK, Spain…) where employees are to seek (possibly full) recovery from their employers only if proved liable (and mandatory insurance is to cover it). But in these countries, benefits paid by NHS/Social Security for anyone who is sick or disable may still fill in the gaps to cover injured employees.
Therefore, workers’ compensation in France aims at providing employees certain automatic recovery from Social Security, while excusing employers from some extra liability. In other words, how is an employee granted limited compensation for work-related accidents by Social Security regardless of any liability from his employer who is in turn exonerated from all liability unless proved grossly negligent?
The requirements for work-related accidents will be first analyzed (I.). Then, what compensation from Social Security is available to an employee for his personal injury regardless of any liability from his employer? (II.) Further, when can an employer stop being excused to instead become fully liable when he commits gross negligence? (III.). Finally, a conclusion will be drawn.
I. Requirements for workers’compensation
Art. L. 411-1 of the Social Security code sets out the requirements: “A work-related accident is an accident, whatever the cause, arising out of or from a job performance by an employee or anyone who is hired, whatever the reason or the location, by one or several employers or business owners.” This requires to be met: an employment relationship (i), a sudden, damaging event (ii), and a loss arising out of the employment relationship (iii).
- An employment relationship
This is when the employer has the right to exercise some degree of direction and control over his employee.
For example, it takes place in an employment contract whereby the employer determines the physical details (time, place, method, etc.) of the performance of the work and fires his employees. However an independent agency contract is not an employment relationship.
- A sudden, damaging accident
An accident is any sudden, damaging event happening to the employee.
Occupational diseases may allow recovery if they match one included on a list issued by the public health authorities and the employee can prove that he has experienced long-time exposure to it at his workplace (Art. L. 461-1 of the Social Security code).
- An loss arising out of the employment relationship
It is presumed that an accident arises out of the employment relationship if it takes place when the employee is within the place and time of work. Therefore, one often needs to look at the employee’s job description to determine whether an accident arises out of the employee’s job.
It can also be the case if the employee is outside his regular work schedule or his place of work as long as he was performing his job tasks or obeying his superior’s instructions.
It also includes when the employee is going to and coming from work, subject to the establishment that is was his usual way and he did not make a detour or run an errand unrelated to work (Art. L. 411-1 of the Social Security code).
Horseplay between employees (e.g., brawls) and murder at work while under the employer’s supervision are deemed to be work-related accidents and give rise to compensation.
It also includes when the employee commits suicide if it results from his job (harassment at workplace…).
II.Benefits under workers’ compensation
The injured employee who qualifies for workers’ compensation automatically receives some benefits from Social Security, as described afterward.
No liability needs to be established on the part of the employer who is, however, released from any additional negligent liability. Indeed, Art. L 452-1 of the Social Security Code provides: “Subject to provisions included in articles L.452-1 to L.452-5, L. 455-1, L. 455-1-1 and L. 455-2, the victim or his family may not assert any cause of action under common law in compensation for any accidents or disease mentioned in this Code.”
- Pecuniary losses
Employees are compensated for the pecuniary losses and out-of-pocket expenses arising from the work-related accident.
This mainly includes the medical expenses, such as doctor, hospital, nursing, tests, medicines, devices, physical therapy, and travel to obtain these services (Art. L 432-1 of the Social Security Code).
- Temporary disability benefits
This is the payment of total or partial lost wages during the time the employee is unable to work or until his injuries stabilize (Art. L 433-1 of the Social Security Code).
The employee receives a benefit of 60% of his daily wage for the first 28 days he is unable to work and then a benefit equal to 80% of his daily wage, provided that a ceiling applies on the amount of the daily wage which the benefit is based on (€327.16 in 2017) (Art. L 433-2 of the Social Security Code).
The benefit is paid twice a month to the injured worker.
- Permanent disability benefits
This is the compensation of impaired future earning capacity after the employee returns to work or his injuries stabilize (Art. L 434-1 of the Social Security Code).
The permanent disability benefits are calculated on a yearly basis according to two steps (Art. L 434-15 of the Social Security Code):
- First, a rate of lost earning is calculated by adding ½ of the disability rating for its amounts below 50% and 1 ½ of it for its range beyond 50%.
Ex.: a 70 % disability rate amounts at a rate of lost earning of ½ of 50% + 1 ½ of 20 % = 55 %
- Then, the rate of lost earning is multiplied by the employee’s yearly lost wage capped at twice the amount of a government-set minimum yearly wage (€18,281.80 in 2016 x 2 = €36,563.60) plus 1/3 of any outstanding amount limited to 8 times this minimum yearly wage.
The permanent disability benefits are paid once every three months by dividing the yearly amount by four until the employee’s death (or every month by dividing the yearly sum by 12 in the case of 50% or more disability rating).
The permanent disability rating is set by Social Security according to the employee’s type of disability, general medical condition, age, physical and mental capacities, as well as his professional skills and degrees, based on the establishment of a medical expert report (Art. L 434-2 of the Social Security Code). The employee and/or the employer may challenge Social Security’s decision before a special administrative agency (“Tribunal du Contentieux de l’Incapacité”, Art. L 143-1 of the Social Security Code) but with an appeal still available before the Court of Appeals and possibly the French Supreme Court (“Cour de Cassation”).
Additional benefits are paid to the employee for the cost of custodial care as a result of his inability to care for himself if he is assessed to be disable at 80% or more (Art. L 434-2 of the Social Security Code).
The employee receives a lump sum if he is less than 10% disable (Art. L 434-1 of the Social Security Code).
Wrongful death actions are also available to the dead employee’s close family members (spouse, children, parents) (Art. L 434-7 of the Social Security Code).
III.Exception of the employer’s gross negligence or intentional tort allowing full recovery to the employee
The employer who commits gross negligence or an intentional tort causing his employee’s accident at work (i) is subject to full liability to him (ii).
- The employer’s gross negligence or intentional tort
Art. L 452-1 of the Social Security Code reads: “when an accident arises from the employer’s gross negligence or his duly-authorized agent’s, the victim or his family members may seek additional compensation as further described in the code.”
Gross negligence is when the employer knew or should have known that his misconduct would cause such damage that actually occurred to his employee and did not take any precautionary measures to prevent it. (See, e.g., Cass. Soc., Feb. 28, 2002.)
Examples of employers’ gross negligent are:
- Violating safety regulations or public health authorities’ rulings and, as a result, the employee gets hurt (See, g., Cass. 2e civ., Nov. 18, 2010);
- Entrusting an employee with the performance of tasks which the employee is not skilled for or fall outside his job descriptions, and the employee fails to properly perform the job and gets hurt accordingly (See, g., Cass. 2e civ., Mar. 16, 2004).
The employer’s intentional tort is, for instance, battery. Then, Social Security may recover all the benefits paid to the employee from the employer (Art. L 452-5 of the Social Security Code).
- The assessment of full recovery to the employee
The employee may claim from his employer additional permanent disability benefits equal to the difference between his rate of lost earning granted by Social Security and his disability rating (Art. L 452-2 of the Social Security Code).
He may receive pain and suffering damages from his employer for the past and future physical pain he sustains (Art. L 452-3 of the Social Security Code). The medical expert report will assess the rate of pain and suffering on a 0-7 scale. Then, it will be up to the employee to assess his damages, based on the full amount of compensation which courts usually award for such pain and suffering multiplied by the rate set by the medical expert report. This leaves some leeway and is different from the opposite approach that compensates injuries based only on an evaluation of permanent impairments such as provided by a doctor association’s guidelines or a “bareme” such as in Spain.
He may be awarded damages for his disfigurement (Art. L 452-3 of the Social Security Code).
He is entitled to damages for the loss of enjoyment of life, i.e., the mental distress resulting from the loss of the ability to enjoy a specific activity that he used to do and cannot anymore (Art. L 452-3 of the Social Security Code).
The employee may be compensated for his loss or diminishment of career plans (Art. L 452-3 of the Social Security Code).
In addition, when the employee’s disability rating amounts at 100%, he receives a monthly lump sum equal to the amount of the minimum monthly wage (Art. L 452-3 of the Social Security Code).
Workers’ compensation benefits granted by Social Security appear to achieve two opposite goals:
- Allowing automatic recovery to injured employees not required to establish any liability on the part of their employers.
- Allocating among all employers the risk of their employees’ accidents at work via benefits paid by Social Security, while limiting any of their extra liability to their employees.
It is only when employers engage in risky activities and are grossly negligent to their employees that the social blame is to remain with them, and their employees are allowed to bring full recovery actions against them. Employers may purchase private insurance to cover this extra risk.
Then, in such a scenario, Social Security may charge employers extra premiums for their coverage by the workers’ compensation program.
Therefore, France follows a middle-ground path between the US which allows limited recovery and the UK and Spain which grant full recovery (with minimum compensation still available via the benefits paid by NHS/Social Security for anyone who is sick or disable).