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COVID-19 and Workers Compensation: Coverage and Considerations

By: Klayton Hiland

The COVID-19 virus, and the world’s response to it, has impacted every aspect of American life for the last nine months. Despite the relatively rapid development of therapeutic treatments and vaccines, all indications are that COVID-19 will stave off America’s “return to normalcy” well into 2021.

In addition to the devastating casualties and its impact on physical and mental health, the virus and ensuing shutdowns brought a previously strong economy to a screeching halt. Texas saw its unemployment rate rise to 6.9% in October 2020, nearly double the 3.5% rate of October 2019.[1] For those Texans fortunate enough to maintain their employment during the pandemic, a common concern is the increased risk of contracting COVID-19 when leaving the safety of quarantine to work outside of the home.

While the health of an infected employee always should be a top priority, a necessary consideration for employee and employer alike is the funding of any necessary treatments. More specifically, employees, employers, and carriers likely are questioning whether workers’ compensation will cover an employee’s COVID-19 infection. The answer seems to be reminiscent of answers given during law school essay exams: it depends.

Basic Considerations

The Texas Labor Code defines a compensable injury as one that “arises out of and in the course and scope of employment.”[2] The Texas Supreme Court has explained that “arise out of” means that the work or working conditions were a substantial factor in causing the injury, without which the injury would not have occurred.[3] The Labor Code further clarifies that an activity occurs in the course and scope of employment when it is “performed by an employee while engaged in or about the furtherance of the affairs or business of the employer,” while precluding travel and transportation unless an exception applies.[4] In simpler terms, workers compensation will cover injuries that would not have occurred but for the work.

This coverage extends to diseases and resulting injuries, otherwise called “occupational diseases.”[5] Workers’ compensation coverage does not extend, however to “ordinary diseases of life,” which are identified as those “to which the general public is exposed outside of employment[.]”[6]

Whether a disease is occupational or ordinary depends on the facts of individual cases. The claimant carries the burden of establishing the causal link between the employment and the disease.[7] This burden is often difficult to carry, as demonstrated by the following precedents.

Relevant Precedents

Differentiating between occupational and ordinary diseases can be a complex task. Proving a disease to be occupational is a heavy burden in many cases; but, “[t]he fact that proof of causation is difficult does not provide a plaintiff with an excuse to avoid introducing some evidence of causation.”[8] Proof is further complicated by the fact the same disease can be occupational in one case, yet ordinary in another, based on a variety of factors.

Employment conditions may be determinative. In Schaefer v. Tex. Emp. Ins. Ass’n, a plumber developed an “atypical tuberculosis.”[9] The plumber often worked in soil contaminated with fecal matter from a variety of species and often was exposed to his employer’s commercial bird raising operation. After a trial consisting of testimony from the treating physician and expert witnesses, the jury concluded that the tuberculosis was an occupational disease and compensable under the Workers’ Compensation Act. The court of appeals reversed this judgment because there was “no evidence of probative force” to support the jury’s finding that the disease was occupational, and further held that the tuberculosis was an ordinary disease of life.[10]

The Supreme Court of Texas affirmed and concluded that even exceptionally rare diseases are ordinary when a causal link between that disease and the condition of employment is not present. Specifically, the plaintiff’s doctor testified that he could not say the tuberculosis was present in bird droppings or soil where the plaintiff worked; the particular strain of tuberculosis plaintiff contracted had not been identified; and the manner of transmission to the plaintiff was unknown.[11] Without testimonial evidence showing some causal link between the disease and employment, the disease was not occupational and, thus, not compensable.[12]

Similarly, though in a far less contestable situation, the court of appeals found in Bewley v. Texas Employers Insurance Association that there was no causal link between the cold, sore throat, and pneumonia a plaintiff suffered and his employment.[13] The plaintiff was forced to work outside in the rain and stand in a flooded parking lot without adequate clothing.[14] While directly linked to the conditions of her employment, the court of appeals determined that plaintiff’s cold and ensuing pneumonia was an “ordinary disease of life to which the general public is exposed which is not compensable under the statute.”[15]

In Godinet v. Thomas, the court reached the opposite conclusion.[16] In that case, the court determined that workers’ compensation benefits had accrued to, and were the only remedy for, a health care provider infected with Hepatitis B. The health care provider was stuck with a dirty needle, which was determined to be the cause of the infection. The court of appeals concluded that, because the Workers’ Compensation Act covered the infection, a subsequent tort action was barred.[17]

Likewise, the court found a causal link to the claimant’s employment in City of Austin v. Smith, where a firefighter suffered an adverse reaction to a Swine Flu inoculation.[18] The plaintiff was encouraged to receive the inoculation by the city, though it was voluntary. The city created a program for prioritizing the inoculation of person who “would be critical to the community in the event of a swine flu epidemic.”[19] The plaintiff received the inoculation while on duty and at a facility owned and operated by his employer.[20] Therefore, the ensuing illness was a compensable injury, despite the fact that the plaintiff received the inoculation—which itself was dispersed to the general population—voluntarily and for his own personal benefit.[21]

Scenarios for Coverage

While it is not entirely clear whether workers’ compensation will cover any individual case of COVID-19 infection, the precedents cited above provide some indications of scenarios where there will be coverage. These scenarios can, in turn, be used by employers and carriers to minimize their exposure to liability.

It appears that a COVID-19 infection is more likely to be covered when the nature of the employee’s work necessitates exposure. Such work conditions could include inability to work remotely, direct contact while at work to numerous people (whether coworkers or customers), and inability or refusal to enforce preventative measures such as masking and distancing. Health care employees and other “essential” workers also will be at a heightened risk of exposure, and, thus, will be more able to demonstrate a causal link between a COVID-19 infection and their employment.[22]

Likewise, an employee who is required to travel for work and can use contact tracing or strain identification to link the infection to a commercial airline flight will have a stronger case for coverage. The perfect storm for coverage, therefore, appears to be a nurse flying to and from a city experiencing an outbreak to work on the COVID-19 floor of a hospital but denied access to personal protective equipment.

Contrarily, COVID-19’s continued spread throughout the general population will make it more difficult to trace the cause of the infection back to the claimant’s place of work.[23] An employee working in a secluded office at a company that strictly enforces social distancing and mask mandates is less likely to be able to prove the infection occurred at work. An employee working remotely is unlikely to benefit from workers’ compensation coverage. Substantial personal travel, unrelated to work, also will make it more difficult for an employee to demonstrate the causal link necessary to define COVID-19 as an occupational, rather than ordinary, disease. Thus, the perfect storm for non-coverage would be an office worker ordered to work remotely, who then takes every opportunity to fly commercially for entirely personal reasons.

Most contested cases for workers’ compensation coverage will fall in the middle of these two perfect storm scenarios. Carriers and employers can limit liability exposure, and help ensure the health of their employees, by enforcing policies that limit exposure to COVID-19. The guidelines provided by the Center for Disease Control are a good starting point.[24] Following this guidance has the added benefit of limiting an employer’s potential liability exposure for gross negligence, which is not subject to the exclusive remedy provisions of the Texas Workers’ Compensation Act.[25]

Finally, it is worth noting that the Texas Workers’ Compensation Act covers aggravation of pre-existing conditions when the aggravation is caused by a compensable injury or, in this case, occupational disease.[26] If an employee succeeds in creating the causal link between an infection and employment, and that infection results in a worsening health—or even death—due to a pre-existing comorbidity, workers’ compensation theoretically would provide coverage and the full range of potential benefits.[27]

State Actions

Some states, anticipating the coverage issues discussed in this article, already have taken actions to ensure workers’ compensation coverage for COVID-19 infections. The actions have varied based on source and scope; some states have enacted legislation, others have issued executive orders. The expanded coverage has varied from all workers to only a select category of workers.[28] Alaska, Minnesota, Utah, and Wisconsin, for example, extended coverage to first responders and health care employees, while Wyoming now covers all workers through legislation.

California and Kentucky have used executive action to expand coverage to all essential workers.[29] The mechanism for these changes is, generally, to list COVID-19 as a “presumed work-related illness,” or an “occupational disease.” This presumption generally can be overcome; but, it effectively flips the burden from the claimant to the employer or carrier. The above discussion of relevant factors and considerations indicate that it will be exceedingly difficult to demonstrate an employee did not contract a COVID-19 infection while at work.

Despite substantial lobbying efforts,[30] no such change has been made in Texas to date. The rising infection rate generally would increase the likelihood that Texas would consider listing COVID-19 as an occupational disease. But that opportunity likely will be mitigated by the incoming vaccines and (hopefully) end of the pandemic.

CONCLUSION

For employees who become infected with COVID-19 in the course and scope of employment, workers’ compensation coverage is a viable method of paying for the medical treatment and wages lost while in quarantine. Coverage determinations will have to be made for each individual claim, based on the claimant’s ability to demonstrate that the employment was a producing cause of the infection. This will be a difficult burden to bear for many workers, which is why several states have taken action to shift the burden to the employer or carrier to show the infection was not related to work.

Though Texas has not taken such a step, employers and carriers still would be wise to enforce risk-mitigation policies that serve the dual purpose of keeping employees safe and reducing the risk of a causal connection. Accordingly, employers and carriers will minimize their exposure to workers compensation claims and liability for potential gross negligence actions until widespread vaccination can, hopefully, bring the COVID-19 pandemic to an end.



 

[1] Anna Novak and Mitchell Ferman, Texans have filed nearly 3.9 million unemployment claims during coronavirus pandemic, The Texas Tribune (Dec. 3, 2020), https://apps.texastribune.org/features/2020/texas-unemployment/.

[2] Tex. Labor Code § 401.011(10).

[3] Transcon. Ins. Co. v. Crump, 330 S.W.3d 211, 221 (Tex. 2010).

[4] Tex. Labor Code § 401.011(12).

[5] Tex. Labor Code § 401.011(34).

[6] Id.

[7] Spillers v. City of Houston, 77 S.W.2d 181, 186 (Tex. App.—Houston [1st Dist.] 1989, writ denied).

[8]  Schaefer v. Tex. Emp. Ins. Ass’n, 612 S.W.2d 199, 205 (Tex. 1980).

[9] Id. at 200-01.

[10] Id. at 201, 205.

[11] Id. at 204.

[12] Id. at 205.

[13] 568 S.W.2d 208 (Tex. Civ. App.—Waco 1978, writ ref’d n.r.e.).

[14] Id. at 209-10.

[15] Id. at 211.

[16] 824 S.W.2d 632 (Tex. App.—Houston [14th Dist.] 1991, writ denied).

[17] Id. at 633.

[18] 579 S.W.2d 84, 85 (Tex. App.—Fort Worth, 1979).

[19] Id. at 87. Notice the similarity in the language used when compared to the current discussion regarding essential workers during the COVID-19 pandemic.

[20] Id.

[21] Id. at 88.

[22] See generally Godinet and Smith, supra.

[23] See generally Schaefer, supra.

[24] Interim Guidance for Businesses and Employers Responding to Coronavirus Disease 2019 (Covid-19), May 2020, Centers for Disease Control and Prevention (Dec. 4, 2020), https://www.cdc.gov/coronavirus/2019-ncov/community/guidance-business-response.html.

[25] Tex. Labor Code § 408.001.

[26] Tex. Labor Code § 401.011.

[27] Tex. Labor  Code §§ 408.021, 408.101, 408.121, 408.141, 408.161, 408.181, 408.186.

[28] Josh Cunningham, COVID-19: Workers’ Compensation, NCSL (Aug. 28, 2020), https://www.ncsl.org/research/labor-and-employment/covid-19-workers-compensation.aspx.

[29] Id.

[30] See, e.g., David Lipman, Law enforcement officers advocating for workers’ compensation benefits for first responders who contract COVID-19, CBS19 (Sept. 1, 2020), https://www.ncsl.org/research/labor-and-employment/covid-19-workers-compensation.aspx.

 


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