COVID-19 Business Interruption, Workers’ Compensation, and Liability Legislation

New coronavirus-based insurance litigation is being implemented. The new policies plan to overhaul business interruption, workers’ compensation, and general liability coverage as more states start to plan for economic activity heading back to normal. Many legal analysts predict that there will be thousands of coronavirus lawsuits filed over the next decade. Even as state governments mandate that things open back up, there are still many liability issues that need to be addressed.

Liability Shield

Republican lawmakers would like to add an employer liability shield to the next round of COVID-19 Business Interruption & General Liability pandemic legislation. Several Democratic lawmakers are not on board with the idea. They believe that the only way business owners can avoid COVID-19 Workers’ Compensation litigation is by adhering to the guidelines put forth by the Centers for Disease Control and Prevention. Workers want assurances that things are safe enough to head back to work. Employers want protection so that they will not be sued if things don’t go smoothly and someone gets sick. Many worker’s rights advocates believe that shielding business owners from potential litigation will reduce their desire to create the safest work environment possible. Ultimately, if people don’t believe that it is safe to go to work or head to the store, they will not go back.

The Workers’ Compensation Debate in California

California Governor Gavin Newsom signed an executive order that helps essential workers who contract COVID-19 and are fighting to secure workers’ compensation benefits. Governor Newsom hopes to simplify the process of filing for worker’s compensation benefits so that workers are given the protection they deserve. The amended policy puts pressure on business owners to prove that their employees did not contract the coronavirus while working on the job. The California Federation of Labor believes that the legislation is necessary to help protect the lives of essential workers. However, the California Chamber of Commerce was critical of the legislation, saying that business owners are now being forced to deal with expensive new mandates that they are unequipped to handle. Many business owners believe that it is unfair to be forced to act as a social safety net.

NCCI Study

According to a study done by the National Council on Compensation Insurance, a small fraction of healthcare workers contracting COVID-19 could lead to substantial losses in the sector depending on the state. Another study showed that the worst possible outcome would be over half of the workforce getting infected. The result is billions of dollars in increased costs. Even if businesses only have to deal with first responders and healthcare workers getting infected, they would still be held liable for over a billion dollars’ worth of claims.

Whether you are a business owner or an essential worker, you must stay informed on the current COVID-19 Business Interruption, Workers’ Compensation, and Liability legislation. It has a direct impact on your future. If you have any questions about your insurance coverage, contact the professionals at Chambers & Company Insurance Brokers. We are here for your business during this unusual time.

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