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On April 13, 2020, the Illinois Workers’ Compensation Commission established an emergency rule amending the Illinois Administrative Code for workers’ compensation hearings that creates a rebuttable evidentiary presumption for workers infected with COVID-19 who work in “critical” industries as defined in Governor J. B. Pritzker’s March 20, 2020, stay-at-home order, as well as those who are first responders. The emergency rule presumes that those workers contracted the illness at work and are therefore entitled to workers’ compensation benefits. The presumption would affect construction companies and virtually all businesses that are permitted to remain open under the governor’s order.

Due to the current difficulty in tracing the exact origin of an individual’s COVID-19 illness— particularly since a construction or manufacturing worker can become infected in many places besides the workplace—the presumption would be exceedingly difficult to overcome.

The emergency rule also appears to be inconsistent with Occupational Safety and Health Administration (OSHA) guidance issued on April 10, 2020. OSHA stated that “[i]n areas where there is ongoing community transmission, employers other than those in the healthcare industry, emergency response organizations (e.g., emergency medical, firefighting and law enforcement services), and correctional institutions may have difficulty making determinations about whether workers who contracted COVID-19 did so due to exposures at work. Accordingly, until further notice, OSHA will not enforce its recordkeeping requirements to require these employers to make work-relatedness determinations for COVID-19 cases, except where: (1) [t]here is objective evidence that a COVID-19 case may be work-related; and (2) [t]he evidence was reasonably available to the employer.”

In response to objections by several business groups, the Illinois state government attempted to reduce the impact of the emergency rule on employers. On April 17, 2020, the director of the Illinois Department of Insurance issued a letter stating that the National Council on Compensation Insurance (NCCI) had determined that COVID-19 claims “[would] be excluded from the impacted employers experience modification” and thus should have no direct rate impact on the affected employers. While providing some relief to contractors, the NCCI’s determination probably does not affect employers participating in captured insurance groups and probably will not affect the industry-wide rate impacts of covering the increased scope of COVID-19 claims through workers’ compensation insurance.

On April 22, 2020, a group of business organizations filed a lawsuit seeking to stop the implementation of the emergency rule. The group asserted that the rule was passed in violation of the Illinois Open Meetings Act, and that only the legislature has the authority to make a substantive change in coverage. The following day, Sangamon County Circuit Judge John M. Madonia issued a temporary restraining order barring implementation of the emergency rule, pending further proceedings.

The emergency rule and the resulting litigation frame the debate over whether the workers’ compensation system is the appropriate vehicle to address COVID-19 healthcare costs for broad parts of the economy. Undoubtedly, there will be further litigation developments in this matter.

Ogletree Deakins will continue to monitor and report on developments with respect to the COVID-19 pandemic and will post updates in the firm’s Coronavirus (COVID-19) Resource Center as additional information becomes available. Critical information for employers is also available via the firm’s webinar programs.

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