With Governor Beshear’s recent Executive Order 2020-277 (EO), many insurers and self-insureds are concerned about the implications.
The EO reads:
- An employee removed from work by a physician due to occupational exposure to COVID-19 shall be entitled to temporary total disability payments pursuant to KRS 342.730(1)(a) during the period of removal even if the employer ultimately denies liability for the claim. In order for the exposure to be “occupational,” there must be a causal connection between the conditions under which the work is performed and COVID-19, and which can be seen to have followed as a natural incident to the work as a result of the exposure occasioned by the nature of the employment;
- The limitations in KRS 342.040( 1) are suspended and temporary total disability payments made pursuant to this Order shall be payable from the first day the employee is removed from work;
- For the purpose of this Order, it shall be presumed that removal of the following workers from work by a physician is due to occupational exposure to COVID-19: employees of a healthcare entity; first responders (law enforcement, emergency medical services, fire departments); corrections officers; military; activated National Guard; domestic violence shelter workers; child advocacy workers; rape crisis center staff; Department for Community Based Services workers; grocery workers; postal service workers; and child care workers permitted by the Cabinet for Health and Family Services to provide child care in a limited duration center during the State of Emergency.
- This Order shall apply to all insurance carriers writing policies providing workers’ compensation insurance coverage in the Commonwealth of Kentucky, self-insured groups, and any employer carrying its own risk and authorized to self-insure in the Commonwealth of Kentucky; and
- Payment by the employer or its payment obliger (sic) pursuant to this Order does not waive the employer’s right to contest its liability for the claim or other benefits to be provided.
(Emphasis in original)
But what does “causal connection” entail?
Under KRS 342.0011(1) communicable diseases are actually excluded from the definition of injury unless “the risk of contracting the disease is increased by the nature of the employment.” The EO seems to be consistent with this requirement, although a presumption is created for a certain classification of workers.
The Commissioner of the Department of Workers’ Claims (DWC) has clarified the EO further:
(6) A worker whose removal from work falls within the presumption of numerical paragraph three of the Order is eligible for benefits immediately upon removal. The employer or its payment obligor may not deny payment of benefits pursuant to the Order without evidence forming a good faith basis for denial. For example, if a grocery worker’s spouse tests positive for COVID-19 and the worker is removed from work solely due to that exposure, the employer may deny the claim since the evidence rebuts the presumption that the exposure was occupational; and
(7) A worker whose removal from work does not fall within the presumption of numerical paragraph three of the Order must establish that the removal is due to “occupational exposure” as that term is defined in numerical paragraph one of the Order. The employer or its payment obligor must promptly investigate the claim and may deny payment of benefits pursuant to the Order if it has a good faith basis for doing so. For example, a restaurant worker who is removed from work by a physician based on “exposure to COVID-19” without further explanation has not established “occupational exposure” and has not established entitlement to benefits.
This statement elucidates that there are essentially two categories of employees for purposes of the EO: (1) A specially classified employee and (2) All other employees not delineated under Paragraph 3 of the EO. With the former, an employer or its payment obligor cannot deny benefits unless there is as good faith basis for the denial. With the latter, non-classified employees must essentially meet the standard burden of proof of an increased risk under KRS 342.0011(1).
This is all new territory in Kentucky workers’ comp, although Dealers Transport Co. v. Thompson, 593 S.W.2d 84 (Ky.App. 1979) provides some historical perspective.
In Thompson, the claimant contracted viral pneumonia through the course of his employment. The issue on appeal was whether the disease, which resulted in his death, was work-related.
A communicable disease can be an injury within the meaning of the Act. But, it does not follow that a communicable disease must always meet the occupational disease criteria in order to be covered. . . Given the broad statutory language and the subjective and objective tests provided by the Court in Princess Mfg. Company v. Jarrell, Ky. 465 S.W.2d 45 (1971), the task of determining whether a disease is an occupational disease as opposed to an injury could be a difficult one. Under the regime of Princess, supra, an occupational disease may be found if there is substantial evidence that either employment conditions specifically affected the employee in a manner resulting in contraction of disease, or employment conditions generally can to a reasonable medical probability cause a particular disease or condition in a given class of workers.
While the Court found the claimant’s estate had failed to establish claimant was exposed to the virus while at work, they did find that the estate “produced competent medical testimony by two doctors from which it could be inferred that the conditions under which decedent worked could have lowered his resistance to pneumonia or could have caused a mild viral infection to become much more severe even fatal.” They found the evidence on this point constituted substantial evidence and upheld the Workers’ Compensation Board as the ultimate fact-finders.
Roland Legal will continue to keep you advised of further developments from the DWC regarding the pandemic and its implications on the law and DWC procedures.