(dissenting). The determination of whether a particular collective bargaining agreement covers a particular employe grievance requires a careful analysis of the relevant terms of that agreement. In this case, I believe the analysis employed by the court of appeals, from both a legal as well as a factual standpoint, properly determined that the collective bargaining agreement between the union and the county does not require the county to submit to arbitration the issue of whether it refused to rehire Lewis without reasonable cause.
My primary purpose in writing separately, however, is to register my fears that the majority's misreading of the Worker's Compensation Act's (Act) exclusivity provision will expose employers to tort liability when they refuse to rehire employes who have suffered work-related injuries. Because I believe the majority's intérpretation in this respect violates both the letter and the spirit of the Act, I respectfully dissent.
Section 102.03(2), Stats, of the Workers Compensation Act provides that:
Where such conditions exist the right to the recovery of compensation under this chapter shall be the exclusive remedy against the employer....
*46The "conditions" referenced in sec. 102.03(2), Stats, are the "Conditions of Liability" listed in sec. 102.03(1). Thus, in order for the Act's exclusivity provision to apply, two requirements must be met: 1) the "Conditions of Liability" in sec. 102.03(1) must exist, and 2) there must be a right to recovery of compensation provided under the Act.
With respect to the second of these requirements, section 102.01(2)(am), Stats, defines "compensation" to mean "workers compensation." Section 102.01(1), in turn, states that "allowances, recoveries and liabilities under this chapter constitute 'workers compensation.'" Therefore, if a section of the Act creates either an allowance, a recovery, or a liability, it provides "compensation." The remedies in sec. 102.35(3) meet that definition. Section 102.35(3) states that:
Any employer who without reasonable cause refuses to rehire an employe who is injured in the course of employment, where suitable employment is available within the employe's physical and mental limitations, upon order of the department and in addition to other benefits, has exclusive liability to pay the employe the wages lost during the period of such refusal, not exceeding one year's wages.
This language is clear. Under sec. 102.35(3), Stats., employes who have not been rehired because of a work-related injury can recover up to one year's lost wages, and employers who refuse to rehire injured employes are liable for those wages.
Because sec. 102.35(3), Stats, undeniably provides "compensation," the remedies therein constitute the employe's exclusive remedies if the "Conditions of liability" listed in sec. 102.03(1), Stats, also exist.. *47Included among those "conditions" is one which limits an employer's liability under the Act to situations where "the employe sustains an injury." Section 102.03(l)(a). The term "injury" is defined as "mental or physical harm to an employe caused by accident or disease ..Section 102.01(2)(c).
The majority concedes, as it must, that Helen Lewis's original physical injury was such an "injury." Despite that fact, the majority declares that the refusal to rehire is a second injury, separate and distinct from the original physical injury. Because this second injury does not involve "mental or physical harm," the majority concludes that the conditions for exclusivity do not exist.
If, as I suspect, what the majority is trying to say is that the Act does not provide an employe's exclusive remedy against an employer who breaches the terms of a collective bargaining agreement, then I would merely comment that such a conclusion is not only unremarkable, but is one with which I agree. As the court of appeals in this case observed, public policy does not prevent an employer from waiving the Act's exclusivity provisions in order to provide employes with greater procedural or substantive protections than those provided in the Act. Any such waiver on the employer's part, however, must be explicit. Here, the collective bargaining agreement did not explicitly waive the exclusive liability provisions of the Act.
The more significant problem with the majority opinion rests with its conclusion that sec. 102.35(3), Stats, "does not come within the purview of the exclusive remedy provision of sec. 102.03(2)." Opinion, p. 13. The majority does not, nor logically can it, limit this conclusion to cases alleging breach of contract. It necessarily extends to actions in tort as well. As a result, *48today's decision will allow employes who have not been rehired due to work-related injuries to bring tort claims against their employer.
The majority's error in this regard springs from a basic misunderstanding as to why the Act conditions liability, and therefore exclusivity of remedy, on the existence of an "injury." It seems clear that that requirement exists so as to limit the Act's reach to work-related injuries. See sec. 102.03(1), Stats. Here, Helen Lewis sustained such an injury and sec. 102.35(3) provides her exclusive remedy. Again, I reiterate that this is not to say that an employer cannot contractually waive that exclusivity. Absent such a waiver, however, liability is limited to the remedies in sec. 102.35(3).
This rather straightforward reading of the Act is one which the courts of this state have, prior to today, had little trouble applying. For example, in Norris v. DIHLR, 155 Wis. 2d 337, 455 N.W.2d 665 (Ct. App. 1990), an employe brought a claim under the Wisconsin Fair Employment Act, alleging that his employer refused to rehire him because of two handicaps: a back injury and mental retardation. Id. at 339. The back injury was work-related, the mental retardation was not. The issue was whether the exclusivity provisions of the Worker's Compensation Act precluded the employe's Fair Employment Act claim.
The court of appeals held that the answer depended upon the source of the injury. Specifically, it reasoned that sec. 102.35(3), Stats, of the Worker's Compensation Act provided the exclusive remedy for any refusal to rehire related to the back injury because "such an injury is the precise sort for which the worker's compensation system operates to provide prompt and assured recovery and as to which the exclu*49sivity provision should operate to provide immunity." Id. at 340-41, quoting, Schachtner v. DIHLR, 144 Wis. 2d 1, 9, 422 N.W.2d 906 (Ct. App. 1988).
With respect to the mental retardation, however, the court held that the refusal to rehire due to that handicap was not covered by worker's compensation for the simple reason that it was not a work-related injury:
The Worker's Compensation Act is designed to compensate persons for work-related injuries. The Fair Employment Act is designed to eliminate the practice of unfair discrimination in employment against properly qualified persons because of various factors generally having nothing to do with a work-related injury. Sec. 111.31(2), Stats. The fact that an employer refuses to rehire a person after an on-the-job injury for a non-work-related reason has nothing to do with the injury and everything to do with discrimination prohibited by the Fair Employment Act.
Id. at 342-43.
This reasoning is sound. Liability, and therefore, exclusivity, under sec. 102.35(3), Stats, is triggered when the employer refuses to rehire an employe because the employe has suffered a work-related injury. Thus, the majority's assertion that the breach of contract in this case is an injury separate and distinct from the original physical injury is not so much incorrect as it is immaterial.1
*50Cornejo v. Polycon Industries, Inc., 109 Wis. 2d 649, 327 N.W.2d 183 (Ct. App. 1982), is perhaps even more relevant. In Cornejo, an employe brought a number of tort claims against his employer as a result of the employer's refusal to rehire him because of a work-related injury.2 The court of appeals dismissed Cornejo's claims, holding that sec. 102.35(3), Stats, offered the employe his exclusive remedies for that refusal to rehire. Id. at 651-52.
The majority dismisses Cornejo because the court of appeals apparently premised its holding on a mistaken interpretation of the term "exclusive" in sec. 102.35(3), Stats. Opinion, pp. 14-15. While the majority is correct that "exclusive" in that context refers to the fact that liability under sec. 102.35(3) is solely the employer's, such a conclusion does not in any manner imply that sec. 102.03(2)'s exclusivity does not apply to sec. 102.35(3). The fact is that the majority's decision today will allow precisely the sort of tort actions which were properly dismissed in Cornejo. In light of the history and purposes of the Act, documented so well in the majority opinion, I cannot believe that is proper. See also, Schachtner, and Marson v. LIRC, 178 Wis. 2d 118, 503 N.W.2d 582 (Ct. App. 1993).
*51To summarize, I believe the majority is simply incorrect when it concludes that. sec. 102.35(3), Stats, does not fall within the exclusivity provisions of sec. 102.03(2), Stats. This may not be readily apparent in cases such as today's where the employe's claim sounds in breach of contract. The real mischief, I believe, will come home to roost when the terminated employe brings a panoply of tort actions against an employer. Today, the majority opens the door to such claims. One could, of course, adopt the majority's view that the issue of tort liability is a matter best left for another day. I do not believe, however, that this court should close its eyes to the plainly foreseeable consequences of its own decisions. I would affirm the court of appeals.
I am authorized to state that Justices Roland B. Day and Donald W. Steinmetz join in this dissenting opinion.
In Karst v. F.C. Hayer Co., Inc., 447 N.W.2d 180 (Minn. 1989), an employe terminated due to a work-related injury argued that the Minnesota Worker's Compensation Act did not provide his exclusive remedy because the refusal to rehire was an injury "separate and distinct" from the original physical injury. Id. at 184. The Minnesota Supreme Court disagreed:
*50Although the injuries suffered by Karst as a result of Hayer's refusal to rehire him may be conceptually distinct from his work-related injuries, any difference is immaterial .... The issue is whether the [Minnesota Worker's Compensation Act] provides a remedy for these injuries.
The court found that the Minnesota statute provided a remedy and that it was exclusive. Id. at 186.
Cornejo's complaint alleged that his employer "acted in bad faith, inflicted emotional distress, and committed fraud and outrage . . ." when it refused to rehire him because of a work-related injury. Cornejo, 109 Wis. 2d at 650.