Alabama Judge Declares State’s Workers’ Compensation Act Unconstitutional

Written by: Brian Mallow, Esq.

On Monday, an Alabama Circuit Court Judge issued an order, finding two provisions of the Alabama Workers’ Compensation Act unconstitutional. Judge Pat Ballard held that the state’s $220 per week cap on permanent partial disability benefits (enacted thirty years ago) fails to provide an adequate remedy to injured workers in violation of the State Constitution and fails to provide equal protection to different classes of employees under the U.S. Constitution. He also ruled that the Act’s 15% cap on contingency fees fails to afford due process of law and violates the separation of powers between the legislative and judicial branches. While only these two provisions were held unconstitutional, the Act contains a non-severability provision, so Judge Ballard’s ruling effectively nullifies the entire Alabama Workers’ Compensation Act.

Recognizing the magnitude of his ruling and the effect that it will have on employees, employers, insurers, and medical providers across the state, Judge Ballard stayed his order 120 days and invited the legislature to take prompt action to address the constitutional deficiencies. According to the judge’s order, this crisis is “the direct result of a problem created and allowed to persist by the legislature.” The current legislative session ends in just a few days, however, and a quick legislative solution is unlikely.

Far more likely is that the order will be appealed to the Alabama Court of Civil Appeals, which could extend the stay further before ultimately considering the constitutional issues itself. While chances are good that the decision will be reversed, a total and abrupt end to the state’s workers’ compensation system would have an extensive and disastrous effect that benefits no one. Perhaps while the case is on appeal, employee and employer/insurer interests can come together to effect an agreeable legislative change.