Posts Tagged ‘Defense Based Act’

Exclusive Remedy wins: Safe in Florida … for now. Also upheld in DBA suit

Thursday, June 25th, 2015

The big workers comp news of the week: A three-judge panel of the 3rd District Court of Appeal overturned a ruling that challenged the concept exclusive remedy: Appeals court tosses out key workers-comp ruling. Refresher: In the 2014 Florida case often referred to as the Padgett ruling, Miami-Dade Circuit Judge Jorge Cueto ruled ruled workers compensation unconstitutional, commenting that state legislative reforms had weakened the law to a point where the remedy for employees was no longer sufficient to warrant the loss of their right to sue employers.

But before exclusive remedy proponents break out the champagne to celebrate the victory, in Padgett Out, Now What? Dave DePaolo dissects the ruling, explaining why any celebrations may be premature.

“But the 3rd DCA set aside Judge Cueto’s ruling on procedural grounds, not addressing any of the merits. This leaves the question open.

The organizations pushing the constitutional challenge have vowed to continue the fight.

And those defending the system realize that the attacks will continue, particularly since there are still two cases pending in the Florida Supreme Court attacking smaller provisions of the law on similar grounds (Westphal v. City of St. Petersburg is about the statutory limits on the payment of temporary total disability benefits, and Castellanos v. Next Door Co. involves a challenge to the cap on claimant attorney fees).”

For the legal nerds in the crowd, a must-see analysis on the case can be found at Judge David Langham’s post It is Padgett Time, Third DCA Reverses. As Deputy Chief Judge of Compensation Claims for the Florida Office of Judges of Compensation Claims and Division of Administrative Hearings, Langham wields some expertise on the matter — his post is worth reading.

Exclusive remedy upheld in Defense Base Act ruling

In other recent exclusive remedy legal news, the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) reaffirmed that the Defense Base Act (DBA) is the exclusive remedy for contract workers. See: The D.C. Circuit’s Message to Injured Government Contractor Employees: ‘There’s an Exclusive Remedy For That’ in National Law Review.

“Despite the Act’s broad exclusivity provision, in Brink v. Continental Insur. Co., an estimated class of 10,000 contractor employees who were injured in Iraq and Afghanistan brought a purported class-action lawsuit for $2 billion against dozens of government contractors, alleging that the contractors conspired with their respective insurance carriers to deny the workers DBA benefits. But a three-judge panel of the D.C. Circuit unanimously rejected plaintiffs-appellants’ claims and, in a 17-page opinion, made five key findings that will help government contractors defend similar lawsuits in the future.”


3rd DCA Reverses Summary Judgment in FWA Constitutional Challenge to Exclusive Remedy

Brink v. Continental Insurance Company, Court of Appeals

Appeals Court Tosses Out Key Workers Comp Ruling

D.C. Circuit tosses suit brought by injured military contractors

Iraq contractors and workers compensation

Friday, June 25th, 2004

In the last few months, the deaths of independent and military contractors in Iraq have been much in the news. According to the Brookings Institution, there are more than 15,000 security contractors in Iraq, making independent contractors the second largest force after the U.S. military.

Recently, the Department of Labor has issued statistics about workers compensation claims for U.S. contractors, including those in Iraq. Of the 771 workers comp claims filed by U.S. contractors so far this year, 345 occurred in Iraq. Of the 66 deaths, 57 occurred in Iraq.

Workers compensation for contractors is mandatory under the U.S. Defense Based Act (DBA) of 1941. Coverage applies to both U. S. workers and any foreign subcontractors who are not covered under their own country’s workers comp laws. Since Iraqi contractors are not covered by workers comp, any contractors must be covered under the DBA.

According to the DOL, there are three major insurance carriers currently providing DBA coverage in Iraq: ACE-USA, AIG, and CNA, although there are more than 700 carriers and self-insured employers authorized to write coverage under the Longshore and Harbor Workers’ Compensation Act.
“DBA benefits are include disability, medical, and death benefits to covered employees who are injured or killed in the course of employment, whether or not the injury or death occurred during work hours. Compensation for total disability is two-thirds of the employee’s average weekly earnings, up to a current maximum of $1,030.78 per week. Compensation also is payable for partial loss of earnings. Death benefits are half of the employee’s average weekly earnings to the surviving spouse or to one child, and two-thirds of earnings for two or more such survivors, up to the current maximum weekly rate. Permanent total disability and death benefits may be payable for life, and are subject to annual cost of living adjustments.” DOL

Insurers are not mandated to provide this coverage. As an inducement, the government reimburses insurers for war related claims:

“Labor Department officials said they had no cost estimate for reimbursements of Iraq-related claims, but given the maximum payment of $1,030.78 per week and the number of injuries and deaths, it could well climb into the multimillions. In past years, annual reimbursement costs under the War Hazards Act have ranged from $1 million to $2 million.
…Rates have ranged from an early low of $10 per $100 of an employer’s payroll to as much as much as $40 per $100 of payroll in recent months, said Hartwig of the insurance institute. That means an employer with a million-dollar payroll would pay between $100,000 and $400,000 in premiums.
Insurers also are limiting terms of policies, such as not offering as much coverage in some locations or for certain types of jobs, and raising deductibles.”

Countries submitting the most claims since September 2001:
529 – Iraq
317 – Kuwait
60 – Bosnia-Herzegovina
52 – Colombia
51 – Saudi Arabia
48 – Germany
44 – Afghanistan
30 – Marshall Islands
26 – Qatar
(source: DOL)
Contractors submitting the most claims since September 2001:
346 – Halliburton
309 – CSC Dyncorp 309
307 – Raytheon
157 – Titan
142 -CSA Ltd.
118 – ITT Industries
99 – L-3 Communications
96 – General Dynamics 96
89 – Northrop Grumman
54 – Washington Group International
(source: DOL)