As the number of COVID-19 cases continues to surge in Oregon, the battle over workers’ compensation for essential workers who contract the virus is heating up. Labor interests are seeking a presumption that essential employees who contract COVID-19 qualify for workers’ compensation, while business supports maintaining existing workers’ comp claim evaluation processes with some additional protections and oversight that can be implemented by rule.
After extensive hearings and discussion, the influential Management-Labor Advisory Committee (MLAC) whiffed last week on reaching a consensus on ‘presumption’ or continuing existing regulation. That could put essential worker eligibility in the hands of a special legislative session anticipated later this summer or early fall.
Resolution of the issue also could turn on congressional action. Senate Republicans want the next coronavirus relief measure to include immunity for business from civil liability on COVID-related lawsuits. The House-passed relief package doesn’t contain immunity provisions. A compromise between the House and Senate may wind up with an immunity provision. There is political pressure on Congress to reach a compromise before its August recess and a lapse in key relief measures such as a $600 weekly unemployment insurance boost, which expires at the end of July.
If a congressional compromise includes some form of business civil liability immunity, the Democratically controlled Oregon legislature may be inclined to grant labor’s wish for a workers’ compensation presumption for essential worker COVID claims.
“Firefighters, police officers, health care providers, as well as workers in retail, grocery, agriculture and other essential services, are literally putting their lives on the line to keep this state running,” labor interests wrote Governor Brown in support of presumption. “Giving them an impossible burden to meet when they file a workers’ compensation claim feels like a punishment for their dedicated service.”
Labor representatives on MLAC acknowledged a presumption of eligibility for a cohort of claimants runs counter to longstanding practice that ties compensation to workplace injury or illness, “but these unprecedented times call for a solution to match the gravity of the crisis we face… Data from the Department of Consumer and Business Services, based on the claims reported as of July 16, 2020, shows a claim denial of 13 percent by SAIF, and a 67 percent denial rate by other insurers.”
Management representatives on MLAC said, “We conclude that clear and consistent rules for processing COVID-19 claims should be adopted to ensure workers are protected during a quarantine period and don’t have to worry about the cost of a COVID-19 test, even if they don’t ultimately have the condition.”
“But we were unable to accept the sweeping ‘COVID presumption’ that Labor advocates proposed,” management explained. “The data tells us that the experience of those denied individuals is not the norm and because a COVID presumption would create its own set of disparities among Oregon workers.” They cited data indicating only 145 claims had been denied, and most of the denials were by just two insurers. They called for an audit of insurers with high rates of denials.
The disagreement on MLAC was predictable. Labor sees workers bearing the financial brunt of contracting the virus, while management warns the presumption will drive up workers’ compensation rates paid by employers and drive away some insurers. Management also predicted lengthy and expensive litigation over definitions contained in the presumption proposal.
Imposing a workers’ compensation presumption would require legislation, which a rules-based approach to handling COVID-related claims wouldn’t. SAIF, the state-sponsored workers compensation insurer, has drafted rules based on its current approach to evaluating claims, which so far has led to approval of 87 percent of claims.
MLAC did agree on some provisions in its final report, including educational materials for employers and employees on filing workers’ comp claims and rulemaking by Oregon OSHA to bolster enforcement of personal protective equipment and face covering requirements. The committee also agreed insurers with high denial rates should be investigated and encouraging enforcement agencies to dig into concerns about public health, paid leave, contact tracing and employee retaliation.
The next step is for Brown and legislative Democratic leaders to decide how and when to proceed.
Here is a link to all of the testimony, reports and documents submitted to MLAC in reviewing this issue: https://www.oregon.gov/dcbs/mlac/Pages/2020.aspx.