Workers’ Comp Exclusivity Forces $22M Judgment Reversal

Kentucky

The Kentucky Court of Appeals reversed and dismissed a $22.5 million judgment against Scotty’s Contracting and Stone, LLC arising from a 2012 concrete retaining wall form collapse that killed a subcontractor employee and injured three of his coworkers, who had already received workers’ compensation benefits under the policy of their employer, VanMeter Contracting.
Unable to sue their employer directly under Kentucky’s Workers’ Compensation Act due to its exclusive remedy provisions, they instead sued Kentucky Transportation Cabinet engineers for negligence, then arranged an assignment of claims and consent judgment funneling liability back to Scotty’s through a disputed contractual indemnification clause. The court said this was an attempt to “do indirectly what the legislature directly prohibited.”
The court held the indemnification clause unenforceable and held that the underlying trial itself violated due process since it was conducted as a non-adversarial bench trial with only the injured workers’ side presenting evidence, no cross-examination and no jury despite Scotty’s demand for one.
The court further found it “logically and legally impossible” for the engineers’ failure to inspect to be the sole proximate cause of the injuries, since no party ever proved evidence of what actually had caused the wall’s anchor bolts to fail, and remanded the case with instructions to dismiss all claims entirely.

Massachusetts Attorney General Andrea Campbell’s annual Labor Day Report shows his office’s Fair Labor Division took 1,292 enforcement actions against 1,183 employers during Fiscal Year 2026, securing nearly $12.7 million in restitution and penalties for more than 16,410 workers, with worker misclassification violation.
The division took action against nearly 60 employers for misclassifying approximately 1,500 workers as independent contractors, recovering over $2.1 million in restitution and penalties. Among these, online grocery-delivery company Weee! agreed to pay more than $865,000 to settle allegations involving independent contractor and earned sick time violations, providing restitution to more than 160 workers.
Master Millwork, a West Wareham cabinet and millwork company, agreed to pay over $280,000 in restitution and penalties after an investigation found both misclassification and failure to properly pay overtime.
Construction led all industries in enforcement actions at 20%, followed by restaurants and hotels at 19.5%, with the division’s multilingual field team conducting unannounced visits to 37 construction sites and engaging more than 160 employers and nearly 400 workers to provide guidance on wage, hour, and classification laws.

Montana State Fund’s board of directors approved a $45 million dividend for eligible policyholders, marking the 28th consecutive year the carrier has issued a dividend.
The Helena-based workers’ compensation carrier has returned a total of $557.5 million to policyholders since 1999.
Dividend payments will be distributed by check, ACH deposit, or account credit beginning in late October.
MSF provides workers’ compensation coverage to nearly 25,000 Montana businesses and more than 150,000 workers.