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Mandery v. Costco Wholesale Corp.4/18/2005
An employee cannot waive by contract the benefits of Washington's Industrial Insurance Act by barring himself or herself from the right to claim its benefits. Because the employment agreement in this case purports to bar the employee from pursuing workplace injury damages from a third party, and the Industrial Insurance Act specifically assigns to employees the right to pursue such third party claims and the right to retain a portion of any award, the contract provision purporting to release the third party from workplace injury liability is void. We therefore reverse and remand for a new trial.
FACTS
Susan Mandery was employed by Warehouse Demo Services, Inc. (WDS) to demonstrate and distribute product samples in Costco stores. When she was hired in May 2001, she signed an employment agreement with WDS which stated:
Release of Potential Claims: Employee understands that WDS is a unique service organization specializing in providing product demonstrations exclusively for Costco Wholesale. These services are provided on Costco Wholesale's premises. The Employee further understands WDS provides workers' compensation insurance benefits for on-the-job injuries, occupational diseases, or wrongful death incurred while working for the Company on Costco Wholesale's premises. Employee agrees to look solely to WDS and its insurer for all damages and/or expenses related to any illness, injury or wrongful death covered by said workers' compensation policy. Employee agrees that such coverage is adequate and fully compensatory and therefore releases, waives, discharges and covenants not to sue WDS, Costco Wholesale and all of their directors, officers, employees, agents, parent companies, subsidiaries, affiliates, successors and assigns from and against any and all claims, demands, losses, damages or liability of any and every kind, whether caused by negligence or otherwise, except for rights which Employee may have under the provisions of the applicable workers' compensation laws or as otherwise prohibited by law. Employee understands and agrees the foregoing Release is intended to be as broad and as inclusive as is permitted by the laws of the various states in which the Company operates and if any portion hereof is held invalid, it is agreed the remainder shall, notwithstanding, continue in full legal force and effect.
On July 26, 2002, while working at a Costco store, Mandery slipped and fell as a result of some flowers or foliage that she alleged were negligently left on the warehouse floor. She sought and obtained workers' compensation benefits for her injuries. She then filed a third party suit against Costco and others, seeking to recover for the injuries that she suffered from the slip and fall.
In February 2004, Costco filed a motion for summary judgment alleging that Mandery had waived her negligence claim when she signed the employment agreement with WDS. The superior court agreed and entered summary judgment in favor of Costco and denied Mandery's motion for reconsideration. Mandery appealed and the Department of Labor and Industries (the Department) intervened.
ANALYSIS
Mandery and the Department claim that the contract provision purporting to immunize Costco from Mandery's third party workers' compensation lawsuit is void: (1) by the contract's own terms, (2) because it violates the express provisions of the Industrial Insurance Act, and (3) because it violates public policy. Because we find the contract violates the express provisions of the Industrial Insurance Act, we confine our analysis to the statutory claims. We review summary judgment orders de novo.
Washington's Industrial Insurance Act, est
Page 1 2 Washington Personal Injury Attorneys
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