What Is a Third-Party Claim in a Workplace Injury Case?

When someone is injured on the job, workers’ compensation is often the first source of benefits they consider. Workers’ compensation can provide medical treatment and wage-loss benefits without requiring an injured employee to prove that the employer was negligent. But workers’ compensation is not necessarily the only legal remedy available after a workplace accident.

In some cases, a person or company other than the employer may have caused or contributed to the worker’s injuries. When that happens, the injured worker may have a separate third-party personal injury claim against the responsible party.

In Illinois, Section 5(b) of the Workers’ Compensation Act specifically allows an employee to pursue legal proceedings against a third party whose conduct creates legal liability for the worker’s injuries, even when the employer is paying or is responsible for workers’ compensation benefits.

A third-party claim can be significant because a civil personal injury lawsuit may provide compensation for certain damages that are not generally available through workers’ compensation. However, third-party cases also involve important issues concerning liability, insurance coverage, deadlines, and the employer’s workers’ compensation lien.

“A workplace injury does not always end with a workers’ compensation claim. When another person or company may have caused the accident, it is important to investigate that potential third-party liability and determine every source of compensation available under Illinois law.” — John J. Malm, Naperville injury attorney

Workplace Injuries Affect Thousands of Illinois Workers

Workplace injuries are a significant concern throughout Illinois. According to the U.S. Bureau of Labor Statistics, private-industry employers in Illinois reported 91,600 nonfatal workplace injuries and illnesses in 2024. The state’s total recordable case rate was 2.2 cases per 100 full-time equivalent workers. Of those Illinois cases, approximately 58,300 involved days away from work, job transfer, or restriction, and approximately 37,900 involved days away from work specifically.

The industries with significant numbers of reported injuries and illnesses included:

Trade, transportation, and utilities
Education and health services
Manufacturing
Construction and other goods-producing industries

The BLS reported that trade, transportation, and utilities; education and health services; and manufacturing together represented about 53% of private-industry employment in Illinois but accounted for approximately 75% of occupational injuries and illnesses reported in 2024.

These statistics demonstrate how frequently Illinois workers encounter conditions that can result in serious injuries. In some of those cases, the circumstances may involve a third party whose negligence or wrongful conduct creates a separate legal claim.

What Is a Third-Party Workplace Injury Claim?

A third-party claim is generally a personal injury claim against an individual, business, manufacturer, property owner, driver, subcontractor, or other entity that is not the injured worker’s employer but may be legally responsible for causing the accident.

For example, imagine a construction worker is performing a job at a construction site when a delivery truck operated by an outside company backs into the worker. The employee may have a workers’ compensation claim against the employer because the injury occurred in the course of employment. At the same time, the injured worker may have a negligence claim against the trucking company or driver if their conduct caused the collision. The two claims are different.

The workers’ compensation claim generally concerns the employee’s relationship with the employer and the benefits available under the Illinois Workers’ Compensation Act. The third-party case is a civil claim based on the third party’s alleged negligence or other legal liability.

Illinois law expressly permits these claims. Section 5(b) provides that when a workplace injury or death is caused under circumstances creating legal liability for damages by someone other than the employer, legal proceedings may be taken against that person even though workers’ compensation has been paid or is owed.

Common Examples of Third-Party Claims

Third-party claims can arise in many different types of workplace accidents. The identity of the potentially responsible third party depends on what caused the accident. Examples can include:

Motor vehicle accidents: A worker driving for work or performing duties near a roadway is injured by another driver’s negligence.
Truck accidents: A commercial truck driver or trucking company causes a collision involving a worker.
Construction accidents: A subcontractor, property owner, equipment operator, or other company contributes to an accident.
Defective products: A dangerous machine, tool, vehicle, or other product causes a workplace injury.
Premises liability: A worker is injured because of a dangerous condition on property controlled by someone other than the worker’s employer.
Negligent contractors: An outside contractor creates an unsafe condition that injures another company’s employee.
Dog attacks: A worker is attacked or bitten by an animal owned or controlled by someone outside the employment relationship.
Negligent property maintenance: A delivery driver, maintenance worker, or other employee is injured because a third party failed to maintain reasonably safe premises.

Determining whether a third-party claim exists requires examining the circumstances of the accident rather than simply asking whether the injury occurred at work.

How Is a Third-Party Claim Different From Workers’ Compensation?

One of the most important distinctions is that workers’ compensation generally operates without requiring the employee to prove negligence. A third-party personal injury lawsuit, by contrast, ordinarily requires establishing the legal elements of the claim against the responsible party. The potential damages can also differ.

Workers’ compensation benefits may include medical expenses and wage-loss benefits, along with compensation for permanent disability or impairment under the applicable provisions of Illinois law. A third-party negligence case can potentially seek broader categories of damages, depending on the facts and applicable law. These can include:

Medical expenses
Lost income and diminished earning capacity
Physical pain and suffering
Emotional distress
Loss of normal life
Disability or disfigurement
Other legally recoverable damages

The availability and amount of particular damages depends on the circumstances of the case.

You Can Potentially Pursue Both Claims

A common misconception is that an employee must choose between workers’ compensation and a third-party lawsuit. In Illinois, that is not necessarily the case. Section 5(b) specifically contemplates a situation in which an employee receives workers’ compensation while also pursuing damages from a responsible third party.

For example, suppose an employee is injured when another company’s vehicle strikes them while they are performing work duties. The employee could potentially receive workers’ compensation benefits for medical treatment and lost wages while also pursuing a negligence claim against the responsible driver or company. This is one reason it is important not to assume that a workplace accident is solely a workers’ compensation matter.

What Happens to the Workers’ Compensation Lien?

One of the most important issues in an Illinois third-party claim is the workers’ compensation lien. When workers’ compensation benefits have been paid, Illinois law generally provides the employer or its workers’ compensation carrier with a right to reimbursement from a third-party recovery for covered compensation paid or payable to the employee.

The Illinois Supreme Court has recognized that Section 5(b) gives the employer a statutory lien against a third-party recovery in appropriate circumstances. That does not mean that every dollar recovered from a third-party case simply goes back to the workers’ compensation carrier. Section 5(b) also contains provisions concerning the employer’s share of costs and expenses and attorney compensation associated with obtaining the reimbursement.

The calculation can become complicated, particularly when substantial medical expenses, temporary disability benefits, permanent disability benefits, future benefits, litigation expenses, and settlement negotiations are involved. For that reason, an injured worker should understand the potential lien before resolving a third-party case.

Who Can Be Held Responsible?

A third-party claim is not automatically successful simply because someone other than the employer was present when the accident happened. The third party must have a legally sufficient basis for liability. Depending on the accident, an investigation may need to determine:

Who controlled the location where the accident occurred?
Who owned or operated the equipment involved?
Who was responsible for maintaining the property?
Was another driver negligent?
Did a manufacturer produce or distribute a defective product?
Was an outside contractor responsible for an unsafe condition?
Were safety procedures ignored?
Were there witnesses or surveillance videos?
Are there photographs, inspection records, maintenance records, or other evidence documenting the accident?

Evidence can become particularly important because businesses and insurance companies may begin investigating an accident soon after it occurs.

Third-Party Claims Can Involve Significant Insurance Issues

Identifying the potentially responsible party is only part of the investigation. An attorney may also need to determine what insurance coverage applies. Depending on the circumstances, potential insurance policies can include:

Commercial automobile insurance
General liability insurance
Commercial property insurance
Product liability coverage
Contractor or subcontractor insurance
Umbrella or excess liability coverage
Other specialized commercial policies

Multiple insurance policies can create complicated questions about coverage, liability, policy limits, and competing claims. An injured worker should generally avoid assuming that the workers’ compensation insurer is the only insurer involved in the accident.

Why Evidence Matters in a Third-Party Case

A third-party personal injury claim must be supported by evidence establishing liability and damages. Evidence should be preserved as soon as reasonably possible. Important evidence may include:

Accident reports
Photographs and videos
Surveillance footage
Vehicle black-box or electronic data
Witness statements
Medical records
Employment and wage records
OSHA records
Equipment inspection and maintenance records
Safety manuals and training records
Company policies
Product documentation
Communications concerning the accident
Expert testimony when appropriate

The evidence needed depends on the nature of the accident. For example, a truck accident may require examination of driver logs, electronic logging data, vehicle maintenance records, and other commercial transportation evidence. A defective-equipment case may require preservation and inspection of the equipment itself.

Third-Party Claims After Construction Accidents

Construction sites are particularly likely to involve multiple companies working in the same location. An injured worker may be employed by one company while working alongside employees of subcontractors, general contractors, equipment suppliers, delivery companies, or other businesses.

If an outside company’s negligence contributes to an accident, the injured worker may potentially have a third-party claim in addition to workers’ compensation. Construction accident cases can be especially fact-intensive because responsibility for safety, equipment, supervision, and site conditions may be divided among several entities.

Third-Party Claims After Car Accidents

Motor vehicle accidents are another common setting for third-party workplace injury claims. Consider an employee who is making deliveries when another driver runs a red light and causes a collision. The employee may have a workers’ compensation claim because the accident occurred while working. But the negligent driver may also be legally responsible for the resulting injuries.

Similarly, employees working near roads or construction zones can be injured by motorists who fail to obey traffic laws or operate vehicles safely. In these cases, photographs, crash reports, witness statements, vehicle data, video evidence, and other documentation can become important in establishing what happened.

What Happens if the Third Party Settles the Case?

A third-party case may resolve through a negotiated settlement or proceed to trial. If there is a recovery, the workers’ compensation lien and reimbursement provisions must be addressed. Section 5(b) provides that the employer can seek reimbursement for workers’ compensation amounts paid or to be paid from the third-party recovery.

The Illinois Supreme Court has also explained that the statutory reimbursement mechanism can include future compensation obligations, not merely benefits that had already been paid when the third-party case was resolved. This makes lien negotiations an important part of evaluating the actual financial result of a third-party settlement.

Frequently Asked Questions About Third-Party Workplace Injury Claims

Can I file a third-party claim if I am already receiving workers’ compensation?

Yes, Illinois law expressly permits legal proceedings against a responsible third party even when workers’ compensation benefits are being paid or are owed.

Does a third-party claim replace my workers’ compensation claim?

No. A third-party claim is generally separate from the workers’ compensation claim. Depending on the circumstances, an injured employee may pursue both.

Who is considered a third party?

A third party can be an individual or business other than the injured employee’s employer that may have legal responsibility for causing the accident. Examples include another driver, trucking company, property owner, subcontractor, contractor, or manufacturer.

Can I sue my employer for a workplace injury?

Generally, Illinois workers’ compensation law limits an employee’s ability to pursue a separate common-law or statutory damages action against the employer for an injury covered by the Act, subject to statutory exceptions.

Will I have to repay workers’ compensation benefits from my settlement?

A workers’ compensation lien or reimbursement claim may apply to a third-party recovery. Illinois law establishes rules governing reimbursement, costs, expenses, and attorney fees associated with the third-party recovery.

What if the third party says I was partially responsible?

Illinois comparative-fault principles can affect the amount recoverable in a negligence case. The effect of alleged fault depends on the facts, the applicable law, and the evidence concerning how the accident occurred.

How long do I have to bring a third-party claim?

The deadline depends on the type of claim and the identity of the responsible party. Different statutes of limitation and repose can apply, and special rules may apply to governmental entities or certain types of claims. Because missing a deadline can prevent recovery, an injured worker should investigate potential claims promptly.

Contact the 5-Star Rated Illinois Workplace Injury Lawyers at John J. Malm & Associates

A serious workplace accident can affect your health, income, family, and future. While workers’ compensation may provide important benefits, it is worth determining whether another person, company, driver, contractor, property owner, or manufacturer may also be legally responsible for what happened.

If you or a family member has suffered a workplace injury, John J. Malm & Associates can investigate the circumstances of the accident, identify potential third-party liability, evaluate applicable insurance coverage, and help protect your rights throughout the claims process. Do not assume that workers’ compensation is your only potential source of recovery. Contact our firm after a workplace accident to discuss your case and learn whether you may have a third-party personal injury claim.