A prime contractor establishes a CCIP for a project.  The employees of first- and second-tier subcontractors are injured, receive worker’s compensation benefits, and then sue the prime contractor, alleging the contractor’s negligence caused the injury. The prime contractor argues that, by virtue of establishing the CCIP, paying the worker’s compensation insurance premium, and paying the policy deductible, it is immune from suit due to the worker’s compensation bar.  A Connecticut Superior Court decision[1] has confirmed that the prime contractor is immune from the workers' claims due to payment of the worker’s comp benefits via the CCIP.

The parties did not dispute the essential facts, but argued whether payment of premiums and a deductible under the worker’s comp policy meant that the prime contractor had “paid compensation benefits to the injured party,” which is the standard for immunity under the Connecticut worker’s comp law[2].  The prime contractor argued that payment of the premiums and deductible satisfied that standard.  The workers argued, though, that their direct employers (subcontractors) had “paid” for the worker’s comp by virtue of contract credits for the value of the worker’s comp premiums attributable to the subcontractors’ employees’ work on the project.  There was also CCIP language noting that the prime contractor’s payments were “made on behalf of” the subcontractors.  So the court had to consider whether the application of credits through all subcontract tiers still meant that the prime contractor had “paid” for the worker’s comp policy and benefits. 

In response to these arguments, the court stated that it would apply the ordinary meaning to “paid.”  So the court concluded that the prime contractor had “paid” for the worker’s comp policy, and by that action had “paid compensation benefits to the injured party.”  Thus, the prime contractor could invoke immunity from claims under the worker’s comp statute, and its motion to dismiss the plaintiffs’ claims was allowed.