Washington Metropolitan Area Transit Authority v. Johnson

Background

WMATA, a regional government agency overseeing Metro construction, acted as the general contractor and purchased a comprehensive "wrap-up" workers’ compensation policy for subcontractor employees. Several subcontractor employees were injured and accepted payments under that policy. They then sued WMATA in negligence to supplement their compensation awards. Lower courts split; district courts granted WMATA immunity while the Court of Appeals reversed, finding WMATA had pre-empted subcontractors rather than acted under a statutory duty.

Reasoning

The Court addressed whether the Act’s immunity in §5(a) can cover general contractors and when that immunity applies. It concluded that the Act’s use of “employer” reasonably includes contractors and that §5(a) removes tort recovery only when an employer fails to secure required compensation. Reading §§4(a) and 5(a) together, a contractor is immune so long as it has not neglected its statutory duty to secure backup compensation. Because WMATA bought wrap-up coverage and did not default, the Court reversed and held WMATA immune.

Real world impact

The ruling means contractors who secure comprehensive coverage for subcontractor employees will generally be shielded from related tort suits. That outcome reduces duplicate litigation risk and supports centralized "wrap-up" insurance on large construction projects. The decision shifts emphasis toward ensuring continuous coverage rather than post-injury lawsuits.

Dissents or concurrances

Justice Rehnquist, joined by two Justices, dissented. He argued the Court rewrote the statute, asserting contractors’ backup duties arise only after subcontractor default and that granting full immunity here expands the law beyond the statute.