Walmart Worker’s Settlement Bars her Claim against Iowa Second Injury Fund

Case File

A pharmacy technician's settlement with Walmart, Inc. involved the same subject matter as her claim against the Second Injury Fund and “constitute[d] a final bar to any further rights arising under” the Iowa Workers’ Compensation Act. Simply Research subscribers have access to the full text of the decision.

Case

Kingsbury v. Second Injury Fund of Iowa, No. 25-0717 (Iowa 04/24/26)

What Happened?

A pharmacy technician at Walmart experienced an injury when she tripped and fell over a box on the work floor. Following an independent medical evaluation and a period of temporary total disability benefits, the worker filed a petition for workers' compensation benefits.

The deputy workers' compensation commissioner granted the worker's motion, and Walmart and its insurer filed a notice of intent to settle. A workers' compensation commissioner approved the settlement, which stated that the "subject and nature" of the parties' dispute was the extent of the worker's permanent disability.

Walmart agreed to pay the worker $52,500 as a "full and final" settlement, and the deputy granted Walmart's motion for summary judgment that the worker could not establish a second qualifying loss and that the worker could not establish the extent of Walmart's liability in a collateral action against the Fund.

On appeal, a commissioner affirmed the deputy's decision, and the worker appealed to court. The district court reversed the commissioner's decision, and the Fund appealed to the Iowa Supreme Court.

Rule of Law

If a worker “who has previously lost, or lost the use of” a listed member or organ “becomes permanently disabled by a compensable injury which has resulted in the loss of or loss of use of another such member or organ,” the employer is liable for only the degree of permanent disability that would have existed without the prior injury.

In addition to and after the payment of the employer’s compensation for that degree of permanent disability, the Fund will pay for the remainder of the permanent disability, after first deducting the compensable value of the original injury.

Payment from the Fund can only come in addition to "such compensation, and after the expiration of the full period provided by law for the payments thereof by the employer."

What the Iowa Supreme Court Said

"Unfortunately, for [the worker], her settlement with Walmart [left] her unable to establish a work-related, compensable injury for some degree of permanent disability," the Iowa Supreme Court wrote.

Given the worker's settlement with Walmart, she could not meet the terms of the statute because there had not been and would not be a payment by the employer for a given degree of permanent disability.

"[The worker's] compromise settlement with Walmart left her unable to establish Walmart’s fixed liability for her injury," the court concluded. "This is a necessary
element to trigger the Fund’s obligation."

Verdict: The Iowa Supreme Court reversed the district court's ruling and remanded the case to the district court to enter a judgment affirming the commissioner's decision.

Takeaway

Under Iowa workers' compensation law, liability of the Second Injury Fund is not a statutory prerequisite to liability of the employer, whereas liability of the employer is a statutory prerequisite to liability of the Fund.

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