Fact Sheet: System Letdown Compensation

System Letdown: Worker Safety, Harm and Compensation in the Age of COVID-19

FACT SHEET ON COMPENSATION[*]

Statistics show that it has been extremely rare for workers and their families to turn to the civil courts to hold negligent or reckless employers accountable for illnesses and death caused by COVID exposure at work. State tort and workers’ compensation law, as well as preemption issues, place significant obstacles in the way of workers seeking access to the courts.

When workers have tried to go to court, their cases typically have been thrown out due to preemption by both federal law (e.g., OSHA) and state workers’ compensation laws — usually the exclusive remedy for workers harmed in the workplace.

Workers’ Compensation

·      Early in the pandemic, employers and the insurance industry began aggressive lobbying and media efforts aimed at reducing their responsibility for compensating workers.

·      As to workers who did seek COVID-related benefits under state workers’ compensation laws, their claims were often denied. In some states and in some dangerous professions, a large majority of claims have been denied.

·      Those whose claims have been rejected not only struggle to cover medical, funeral and other costs but also face the added burden of a complicated and lengthy process if they choose to challenge the denial.

·      The pandemic has been a windfall for the insurance industry. Claims that have been paid have been dramatically offset by a huge decrease in non-COVID claims due to shutdowns, workforce reductions and the switch to remote work.  

Liability Shields 

·      Early in the pandemic, business lobbyists pushed lawmakers to provide companies with legal immunity when workers were exposed to COVID on the job and became sick or died.

·      While efforts ultimately failed at the federal level, corporate lobbyists succeeded in convincing many state lawmakers to enact civil liability shields for negligent businesses.

·      At least 30 states enacted COVID-19 liability shields that immunized negligent businesses and other entities from legal accountability. Many laws have expired, but a significant number remain in effect.

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