Kentucky’s Supreme Court has ruled that insurers can be liable for workers’ comp claims even when employees end their careers in another state.
On Oct. 23, the Supreme Court of Kentucky decided Kentucky Employers’ Mutual Insurance v. Clas Coal Co., Inc., et al., clarifying how liability is determined for occupational hearing loss when a worker’s employment spans multiple states.
The case involved Troy Stidham, who worked for Clas Coal Co., Inc. for over 16 years in Kentucky, primarily as a shuttle car operator exposed to continuous loud noise. After the Kentucky mine closed, Stidham continued working for Clas Coal in Alabama for nine months before retiring. He began noticing hearing problems around 2018 or 2019, and was diagnosed with work-related hearing loss by a Kentucky audiologist in August 2021.
Stidham filed a workers’ compensation claim, listing Jan. 1, 2020 – the date he last worked in Kentucky – as his last day of exposure. Kentucky Employers’ Mutual Insurance (KEMI), which insured Clas Coal during Stidham’s Kentucky employment, argued that the claim should be based on his last day of exposure in Alabama, Oct. 31, 2020, and that Kentucky lacked jurisdiction.
The administrative law judge found that Stidham’s hearing loss resulted from long-term exposure in Kentucky, and that the injury occurred on Jan. 1, 2020. The judge relied on Kentucky Revised Statute 342.7305(4), which presumes that the employer with whom the employee was last injuriously exposed to hazardous noise for at least one year is liable for benefits. The judge found Stidham’s nine months in Alabama did not rebut this presumption.
KEMI appealed, but both the Workers’ Compensation Board and the Kentucky Court of Appeals affirmed the decision. The Supreme Court of Kentucky also affirmed, holding that the injury occurred in Kentucky and that KEMI was the insurer at risk. The court emphasized that the 2018 amendment to KRS 342.7305(4) clarified employer liability for cumulative trauma injuries, and that the evidence supported the finding that the injury manifested during Stidham’s Kentucky employment.
The court rejected KEMI’s arguments about extraterritorial jurisdiction, finding those statutes inapplicable since the injury was deemed to have occurred in Kentucky. The decision did not hinge on any specific insurance policy clauses, but on the statutory framework for workers’ compensation liability.
This ruling highlights the importance for workers’ compensation insurers of carefully reviewing work histories in multi-state employment situations, as liability may attach based on the location and duration of exposure, regardless of where an employee retires.
