Terminating an employee in retaliation for filing a Kentucky workers compensation claim was ruled to constitute the tort of wrongful discharge by the Kentucky Supreme Court in Firestone Textile v. Meadows, 666 S.W.2d 730 (Ky 1984). Subsequently, the General Assembly enacted KRS 342.197 and codified a cause of action for workers compensation retaliation.
Employers in defense to a workers compensation retaliation claim under KRS 342.197 often assert that punitive damages are not available as a remedy. That position was undermined by the recent Court of Appeals decision in Taylor v King, 2009-CA-1599 (Ky App, October 1, 2010).
The most pertinent issue in Taylor v King was whether the Kentucky Dram Shop Act, KRS 413.241, could constitutionally prohibit recovery of punitive damages against a seller or provider of alcohol. Because the Kentucky Dram Shop Act is similar to KRS 342.197, because it was enacted after significant common-law development of claims, defenses and remedies, the court's analysis is applicable to the similar issue presented with regard to claims for workers compensation retaliation under KRS 342.197.
Kentucky's jural rights doctrine "flows from a reading of sections 14, 54, and 241" of the Kentucky Constitution and "states that the General Assembly has no authority to abolish or restrict a common-law right of recovery for personal injury or wrongful death." The doctrine, the court added, applies not only to causes of action recognized at the time Kentucky's constitution was adopted in 1891 "but also to actions in remedies which have developed through the common-law since the adoption of the Constitution. Perkins v. Northeastern Log Homes, 808 S.W.2d 809, 815-18 (Ky 1991)." The court then concluded that the Kentucky Dram Shop Act had restricted the opportunity to recover punitive damages in violation of the jural rights doctrine.
A similar rationale applies to KRS 342.197. First, wrongful discharge is a tort and essentially a cause of action for personal injury. Second, the tort of wrongful discharge, like dram shop liability, is an action developed in the common-law since adoption of Kentucky's Constitution in 1891. Accordingly, a construction of KRS 342.197 that punitive damages are not a remedy would similarly violate the jural rights doctrine.