Four Ways QSRs Can Avoid the Risk of ‘Serious & Willful Neglect’ Workers’ Comp Claims
3 Min Read By Martin Flannery
Fast food giant McDonald’s is no stranger to litigation, having defended itself against lawsuits over everything from racial discrimination to hot coffee. But it also has a pandemic era precautionary tale to share with other quick-serve restaurants about going the extra mile to keep workers safe from contagion.
McDonald’s is among the growing number of employers to be hit with a lawsuit by a group of Chicago employees claiming the company failed to meet expert recommendations and government guidance for on-the-job protections against COVID-19.
It’s a lawsuit under Part B of workers’ compensation insurance – a claim of “willful neglect” that has been rare until this year. It requires meeting a high legal bar in proving an employer purposely failed to act appropriately to provide to employees’ health and safety, and in doing so put workers at risk of injury, sickness or death. These claims also have been rare because some states do not provide a provision for Serious & Willful Neglect complaints. Instead, these allegations are handled as part of the regular workers’ compensation claim subject to restrictions based on an employee’s pay, treatment guidelines and Labor Code.
As of November 4, 2020, 100 legal complaints involving COVID-related conditions of employment (including exposure at work and wrongful death) had been filed, according to one tracking service.
In the McDonald’s action, a preliminary injunction entered by the court in late June ordered the chain to provide social distance training and enforce mask wearing policies. But in today’s era of nuclear verdicts, it’s a warning to other operators of the potential issues ahead, whether or not their states mandate mask-wearing and social distancing.
Further, it’s smart to keep in mind that however uncommon, the risk of workers’ compensation Part B claims is real. They have impacted risk tolerance, rates, and capacity, making workers’ compensation more volatile. And they also reinforce the necessity of ensuring restaurant environments are as safe for employees as they are for patrons in these dangerous times.
Operators can help themselves avoid Serious & Willful Neglect claims by following four courses of action, starting today:
- Follow best practices. Your pandemic plan should be part of your Injury and Illness Prevention Plan. It all should be checked to ensure it’s still in compliance. A safe workplace starts with following basic OSHA guidelines, but comprehensive CDC guidelines for COVID-19 safety must also be incorporated. What do safe work practices look like? Start by posting the right notices. Make sure people are trained in safety measures. Follow through on policies and procedures. And document every action you take to support a safe workplace.
- Think wellness. You’ll come out ahead, long-term, by aligning your workers’ compensation program with your employee benefits, with a holistic focus on wellness.
- Take a hard look at your workers’ compensation strategy. Here’s a word to the wise: If your insurance broker doesn’t specialize in workers’ compensation, expect to pay more for coverage if insurers’ predictive modeling identify your organization as an outlier for risk purposes. An experienced broker will guide you on how to stay ahead of these costs, suggesting strategies that add to your protection. It might be smart, for example, to add workers’ compensation as an underlying policy to your umbrella/excess insurance at limits that are appropriate for the circumstances.
- Claims management counts. This starts with reporting new claims immediately, working with your broker and claims adjuster to proactively manage open claims. Importantly, though, incidents and claims must be investigated. To avoid future claims requires the root causes to be identified, so that changes are made to prevent reoccurrence.
These are tough times for the restaurant industry. Operators that take a keen eye to risk mitigation strategies in the face of the ongoing pandemic will be better positioned to keep their organizations and their people healthy.