Class 24

         New Zealand has rejected tort in favor of a system of social insurance that somewhat resembles workmen’s compensation. Workmen’s compensation statutes emerged as a kind of compact between employers and employees. Employers received more certainty about the amount they would have to pay out and managed litigation costs. Employees received a faster, surer payment, with less of their money going to lawyers. Or at least that was how things were supposed to go.

            This Section briefly considers workmen’s compensation—both as a system in its own right and as an alternative to tort. First, we will consider the requirement that an injury occur “in the course of employment.” This means that a worker was doing what she was hired to do at the time of an injury. But a number of wrinkles come into play. What if the worker is commuting or engaging in some kind of mixed business and social activity, like an office holiday party? What if the worker is engaged in horseplay? Next, we will consider the requirement that an accident “arise out of” employment. This is a causal requirement.

            Does workmen’s compensation have advantages when compared to the tort system, or does it share many of the same shortcomings? Why has the tort system persisted?