The current global pandemic has had a dramatic impact on companies around the globe. Employees have had to adapt to the changing workplace environment while following preventative measures and observing the social distancing norms.
Many businesses are now calling employees back to the office, and it isn’t uncommon for the virus to spread among coworkers. If this happens at your company, you may face a number of unexpected expenses, not to mention the physical toll the virus can take.
Workers’ compensation insurance may cover medical expenses for your employees after an injury or illness, but what about during the pandemic? If an employee catches the virus while working at your company, who will pay the costs?
Standard Workers’ Comp Coverage
Workers’ comp insurance covers medical expenses if an employee sustains bodily injury while on the job. The policy ensures that an employee doesn’t just get emergency medical care, but also receives compensatory wages while they recover.
But workers compensation insurance doesn’t just cover at-work injuries—it also covers work-related illnesses. For example, workers’ comp comes into play with repetitive strain injuries, hearing loss over time, lung disease from chemical exposure, and stress-related injuries. Under these circumstances, workers’ comp typically covers medical expenses, lost wages, and the cost of ongoing care.
The Costs Associated with COVID-19
Unfortunately, if even one employee contracts COVID-19, it can cause a ripple effect, engendering various expenses:
Testing Employees- As soon as a person shows symptoms of the virus, they should get tested. If an employee does test positive, anyone who recently came into contact with that person should take the test as well.
Time Off From Work– Employees will need time off from work to quarantine themselves until deemed clear by the state or local officials, and will expect compensation for wages.
Medical Expenses for More Serious Cases– If an employee’s condition declines rapidly, they may need to be admitted to the ICU for intensive care.
Slowed or Halted Production– Your business will likely need to delay or postpone ongoing projects involving any sick or quarantined employees. Since your employees will need care and possibly time off, if there is an outbreak, you will need to find ways to continue your project or put it on hold until you have enough workers.
Will Workers’ Comp Cover It?
The short answer is no, workers’ comp insurance generally will not cover the expenses related to the spread of COVID-19 within a company. Typically, workers’ comp policies do not cover illnesses that are spread via community, such as flu or cold, because there is no practical way to trace the origin of such illnesses.
However, first responders and healthcare workers may be able to retrieve workers’ comp benefits if they contract COVID-19 on the job, depending on their state laws and the specific circumstances. For example, Minnesota, Illinois, and California have extended some special protections to such workers.
Lessening the Load
For financial assistance related to COVID-19, you should first check your business’s eligibility for the provisions of the Families First Coronavirus Response Act, which provides funds for covering employee sick leave. Your business may also qualify for an Economic Injury Disaster Loan.
How Small Businesses are Handling the Outbreak
To protect the health of your employees and reduce the financial burden of the pandemic, you’ll have to demonstrate flexibility and come up with creative solutions for social distancing and sanitation. To do so safely, you can refer to the Centers for Disease Control and Prevention’s Interim Guidance for Businesses and Employers Responding to Coronavirus Disease and the federal guidelines for Opening Up America Again.
For further assistance on the financial side, you’ll find guidance regarding the common issues that COVID-19 has caused for small businesses on the U.S. Small Business Administration website. For example, the SBA offers advice for addressing:
Meeting workforce capacity
Fluctuations in market demand
Marketing and communication the precautions your business has taken
An Employer’s Responsibility
The coronavirus has taken a toll on American businesses, both in terms of health and capital. While your workers’ compensation insurance policy likely won’t help your business recover, there are resources available through the local, state, and federal government. During these difficult and uncertain months, business owners can ease the burden by staying compliant with the changing rules, regulations, and safety recommendations, communicating clearly with employees, and keeping up morale to the best of their ability.
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