State Workers’ Compensation Systems Deal with COVID-19 Claims

11 May 2020 Blog
Authors: Scott T. Allen
Published To: Coronavirus Resource Center:Back to Business Labor & Employment Law Perspectives

A number of  states, including California (by executive order on May 6, 2020), have made it easier for essential workers who contract COVID-19 to obtain workers’ compensation benefits by creating a rebuttable presumption that the infection occurred at work.  This flips the traditional burden of proof on workers to establish that an illness or injury is work-related.

States have addressed this issue with a range of approaches, with many states taking no action and others enacting (or considering) legislation or issuing executive orders.  For example, Wisconsin and several other states have enacted a rebuttable presumption that extends only to health care and emergency response employees.  In contrast, other states, such as California, have issued orders covering all or nearly all “essential” employees who are required to work outside of their homes.  Business groups have generally opposed these changes and, in Illinois, for example, the state workers’ compensation agency repealed a rule that would have presumed that all COVID-19 illnesses affecting essential workers are work-related, after a court struck down the rule.

For employers and insurers seeking to contest workers’ compensation claims, it may be difficult, if not impossible, to determine how a worker contracted the virus (setting aside first responders and health care workers whose job is to deal with COVID-19 patients). Absent an outbreak at the workplace or other compelling evidence, it is difficult to imagine how to prove whether an individual was exposed to COVID-19 at work (from a customer or co-worker), rather than from a family member or other close contact or from somewhere else in the community, like at the grocery store.  (It is particularly difficult to determine the source of someone’s exposure to COVID-19 because it can take up to 14 days to develop symptoms.)

Contrary to the approach taken by many states for workers’ compensation purposes, OSHA’s guidance requires that, while health care and emergency response employers and correctional institutions make work-relatedness determinations for COVID-19 cases, most other employers do not need to record an employee’s COVID-19 illness on their OSHA 300 Logs unless there is evidence (such as multiple infections among close co-workers) indicating workplace exposure to the virus.

Workers’ compensation is a “no-fault” system, meaning that employees can recover for work-related injuries and illnesses, regardless of whether the employee or the employer was responsible for the incident on account of negligent or careless acts.  However, workers’ compensation benefits are the exclusive remedy for job-related illnesses and injuries, and employers can raise this as a defense when employees attempt to sue them outside of the workers’ compensation system. 

While specific standards vary based on individual state law, most states only provide for narrow exceptions, such as when the employer intentionally caused harm to the employee.  Accordingly, plaintiffs who have begun filing lawsuits over wrongful death or illness due to COVID-19 have argued that their employers engaged in intentional conduct that led to COVID-19 exposure at work, and the standards for overcoming workers’ compensation exclusivity vary by state.  At the same time, certain business groups and legislators have advocated immunity for employers from such lawsuits, so stay tuned for developments in this area.

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