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Colorado Workers' Compensation Jurisdiction

What if I'm injured while working out-of-state?

Most of the time, it's pretty clear which state's workers' compensation laws apply in a particular situation. A resident of Denver, Colorado Springs, Pueblo, Grand Junction or any of the quaint small towns that populate our state working in the state at the time of their injury are covered under workers' compensation in Colorado.

But workers' compensation jurisdiction isn't quite so clear in other cases where an injury occurs in another state.

Many companies, especially construction firms, do business in other states... or someone living in Durango, Colorado may commute the 51 miles from their home to a job over the line in Farmington, New Mexico.

Provided you don't fall under one of the conditions we outlined at the beginning of this book, you are covered under workers' compensation if you're injured during the course of your employment – no matter where that may be.

Continue reading to learn more about how Colorado workers' compensation handles injuries where another state comes into play and what you should do to ensure you receive the benefits you're entitled to.

So how do I know which state's laws apply in these situations?

In the beginnings of workers' compensation in Colorado (until 1957), various court cases and the Industrial Commission developed rules on determining jurisdiction since the laws passed by the Legislature contained very little on the matter.

Initially, appellate courts found that "the law of the place of contract governed" determined which state's workers' compensation laws applied. Meaning, the state where an employment contract was finalized was the state whose laws would apply in the event of an on-the-job injury.

Industrial Commission v. Aetna Life Insurance, Co. was a case where questions on jurisdiction were addressed. A resident of Colorado who was hired in the state to supervise construction projects for a company that did business across the west was killed while traveling from Wyoming to Idaho one day for work.

Stating that traveling was an "... essential part of his employment... ," the court awarded full Colorado workers' compensation death benefits to his heirs who also stated that his employment contract created protection for him out-of-state. Without this protection, the deceased's employer would have been required to purchase workers' comp insurance in every state they did business in – something that would have presented a problem no doubt.

On the other hand, just because an injury occurs in Colorado doesn't automatically mean an employee will receive workers' compensation benefits. "Substantial portion" of employment was another early theory of jurisdiction in the state that was codified in the case Platt v. Reynolds and remained the standard until 1957. It basically stated that an employment contract completed in Colorado, with no other ties to the state, wasn't enough to grant the injured employee workers' compensation coverage.

Modern day standards for Colorado workers' compensation jurisdiction: Perryman test and extraterritorial provision

Perryman test

One of the places more concrete rules for establishing jurisdiction for workers from out-of-state arose out of the landmark Denver Truck Exchange v. Perryman case in 1957. In short, the "Perryman test" determines a worker's eligibility for Colorado workers' compensation benefits whose contract for hire was finalized in another state or is a resident of another state.

To qualify for workers' compensation benefits in Colorado, injured workers falling into this situation had to meet two of the following three requirements:

  1. Contract of employment created in Colorado
  2. Employment in Colorado under a contract created outside the state
  3. Substantial employment in Colorado

Provided two of these three requirements are met, the injured worker is eligible to receive workers' compensation benefits in Colorado despite which state they are a legal resident of.

Extraterritorial provisions

These provisions in Colorado workers' compensation laws help determine benefit eligibility for injured workers who are residents of Colorado but are injured while working out-of-state. Extraterritorial provisions in the statutes state that an out-of-state injury has to occur within six months from when the claimant left the state for it to be covered.

However, if the injured worker's only connection to the state is that their injury occurred here, they are not entitled to Colorado workers' compensation benefits. Also, the extraterritorial provision does not cover an employee whose contract for hire is from a different state.

To see this concept play out, let's examine the State Compensation Insurance Fund v. Howington case. A miner hired in Colorado was immediately sent to Utah for work. While the injured worker never actually worked in Colorado, his injuries were covered since they occurred within six months of his hiring and assignment to work in Utah.

Extraterritorial provisions however do require a claimant to have been physically present in Colorado at some point in time. In the case Hathaway Lighting v. Industrial Claims Appeals Office , a claimant who lived in Washington State and was hired by a firm in Colorado was injured while working in Oregon. Since the claimant had never set foot in Colorado, the court found he was not entitled to Colorado workers' compensation benefits under extraterritorial provisions.

While it may seem confusing to figure out which state's workers' compensation rules apply to your situation, you likely qualify to receive Colorado benefits if you meet the criteria outlined above.

Next: Types of Workers' Compensation Insurance in Colorado

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