The Zhuhai Intermediate People’s Court in Guangdong province recently ruled on a case involving a worker who developed pneumoconiosis due to workplace dust exposure. Recognised as a work-related injury by the local labour authority, the worker sought additional personal injury damages from the employer under civil law after receiving work-related injury insurance compensation. The claim included disability compensation, dependent support costs and moral damages, totalling more than RMB740,000 (USD101,500).
The court ultimately ordered the employer to pay the worker RMB470,000, covering the shortfall in disability compensation, dependent support costs and moral damages.
Court opinions
In this case, the employer argued that it had fulfilled its occupational disease prevention obligations and should not bear full liability for the worker’s condition. It further contended that the worker’s disability compensation and dependent support costs were already covered by work-related injury insurance benefits, and allowing duplicate compensation for the same harm would violate the principle of “full indemnity”, which also prevents overcompensation.
The Zhuhai Intermediate People’s Court held that the employer failed to provide sufficient evidence demonstrating the strict implementation of occupational disease prevention measures in its daily operations, or that the worker had neglected protective measures during employment. Consequently, the employer was deemed fully liable for the worker’s occupational disease. Additionally, the court found that the worker’s personal injury losses caused by the occupational disease were not fully compensated through work-related injury insurance benefits.
Therefore, the worker was entitled to claim the shortfall between personal injury damages and insurance compensation from the employer.
Legal basis
Article 58 of the Prevention and Control of Occupational Disease Law stipulates that “a worker diagnosed with an occupational disease, in addition to being entitled to work-related injury insurance under the law, may also claim compensation from the employer in accordance with relevant civil law if such a right exists”.
Similarly, article 56 of the Work Safety Law provides that “an employee harmed in a work safety incident, in addition to being entitled to work-related injury insurance under the law, may also claim compensation in accordance with relevant civil law if such a right exists”. These provisions establish a clear legal basis for workers to claim the shortfall between personal injury damages under civil law and work-related injury insurance benefits.
The takeaways
The court’s reasoning highlighted two key points that employers should particularly note. First, employers must strictly implement occupational disease prevention measures in their daily operations and maintain proper records as evidence. Unless the employer can prove that the worker neglected protective measures during employment, it may bear full liability for the worker’s occupational disease.
Second, the payment of relevant insurance benefits does not fully exempt the employer from civil liability for personal injury damages. While workers cannot receive double compensation for the same harm, they may claim the shortfall between insurance benefits and personal injury damages under the principles of “full indemnity” or “higher compensation prevails”, including compensation for moral damages.
However, compared with the clear provisions of the above-mentioned laws, the courts’ approach to the concurrent application of civil damages and work-related injury insurance compensation remains less defined.
For example, article 3 of the Supreme People’s Court’s Interpretation on Several Issues Concerning the Application of Law in Personal Injury Compensation Cases states: “Where an employee subject to work-related injury insurance suffers personal injury due to a work accident, and the worker or their dependents file a civil claim against the employer, the court shall instruct them to resolve the matter in accordance with the Work-Related Injury Insurance Regulations.”
Additionally, while rulings similar to this case are occasionally seen in other regions of Guangdong, or elsewhere (e.g. Chongqing), they are not yet widespread nationwide.
Nevertheless, due to the profound and long-term harm caused by occupational diseases, if work injury insurance compensation is insufficient to cover the worker’s personal losses, it may lead to financial difficulties, which could result in courts ordering employers to make up the shortfall in personal injury compensation beyond the work injury insurance payout.
To mitigate such risks, employers should strictly implement occupational health standards, regularly conduct occupational hazard assessments in the workplace, provide occupational health training to workers, and guide them in the proper use of protective equipment against occupational diseases.
These measures aim to reduce the occurrence of occupational diseases
at source, ensuring the health and safety of workers. Additionally, employers may consider purchasing supplementary commercial insurance to offset the risk of additional compensation liabilities for workers affected by
occupational diseases.
Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Howard Wu (Shanghai) at howard.wu@bakermckenzie.com
