Recent developments on two hot issues in Workers Compensation: Drug testing for marijuana and COVID-19 – Duncan Financial Group
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Recent developments on two hot issues in Workers Compensation: Drug testing for marijuana and COVID-19

Drug test blank form with Variety of medicines

Recent developments on two hot issues in Workers Compensation: Drug testing for marijuana and COVID-19

More workers are failing drug screens

In 2021, the positive drug test rate for U.S. workers soared to its highest level in two decades, propelled by marijuana positivity rates according to an annual analysis by Quest Diagnostics. Overall 4.6 percent of the 11 million samples taken in 2021 were positive, which is more than 30 percent higher than the 30-year low of 3.5 percent recorded in 2010, 2011, and 2012.

The study breaks down the testing results into the general workforce, which is primarily testing from private employers, and the federally mandated, safety-sensitive workforce, which includes federal employees and the transportation and nuclear power industries, and others required to drug test under federal legislation. In the general U.S. workforce, positivity increased 1.8 percent (5.5 percent in 2020 versus 5.6 percent in 2021) and was 12 percent higher than in 2017 and up each of the last five years.

Retail trade topped the list with seven percent positivity and saw a 55 percent increase in positive methamphetamine drug tests between 2017 and 2021. Transportation and warehousing, other services, construction, and manufacturing saw the highest overall positivity rate increases. Encouragingly, the positivity rates for heroin and other opioids over the past year decreased or stayed the same across all workforces.

Although the overall positivity rate in the federally mandated, safety-sensitive workforce, stayed even year-over-year at 2.2 percent, it notably increased for marijuana, amphetamines, and cocaine after years of decline. Specifically, marijuana increased 8.9 percent (0.79 percent in 2020 to 0.86 percent in 2021), amphetamines increased 7.8 percent (0.64 percent in 2020 to 0.69 percent in 2021) and cocaine increased 5.0 percent (0.20 percent in 2020 to 0.21 percent in 2021) based on urine drug tests.

Positive marijuana urine tests reach highest rate ever recorded

Since 2016, positivity for marijuana in the general U.S. workforce increased 50 percent. All 17 industry categories saw an increase in positivity for marijuana with 15 industries showing a double-digit surge. The industry sector with the greatest rate of marijuana positivity was Accommodations and Food Service (7.5%).

In the past employers relied upon marijuana’s illegality under federal law to support zero-tolerance policies, but complex state and local cannabis laws coupled with worker shortages have put employers between a rock and a hard place. Some states, such as New York and New Jersey, protect off-duty recreational use. Nevada prohibits employers from using positive pre-employment marijuana tests to make hiring decisions, and New York City and Philadelphia ban such tests altogether. In states that provide workplace protections, particularly for medical marijuana users, employers should engage in an interactive dialogue with the employee to determine what reasonable accommodations might be available.

Positivity in post-accident tests increases faster than pre-employment tests for cocaine, marijuana, opiates, and oxycodone

Most alarming, the numbers suggest that more drug-associated accidents may be occurring. Over the last five years, there has been a 26 percent increase in positive test results for post-accident drug tests and in the federally mandated safety-sensitive workforce, a 41.9 percent increase. All industries experienced a 17.4 percent increase in positive test results for pre-employment drug tests and in the federally mandated safety-sensitive workforce, pre-employment positivity increased 9.5 percent.

How employers are responding

Pre-employment drug tests are meant to be a deterrent in hiring workers whose drug-use behavior may cause unsafe work conditions or poor work performance and used to be the most popular drug testing among employers. But that is changing; some are dropping pre-employment tests to comply with state laws, which have become daunting for companies operating in several states. Multi-state companies can choose to abide by different state/local testing requirements or implement a universal policy that complies with the least restrictive state in which they operate, although that could increase the legal exposure to negligent hiring practices if there is an accident.

Others have dropped THC, the psychoactive component in cannabis, from their pre-employment drug panels and no longer randomly test for cannabis in recognition of changing laws and attitudes, as well as the challenges of testing for cannabis and determining impairment. However, they test employees whose safety-sensitive job duties require it, and when there’s an on-site accident. Unlike Amazon which announced it had stopped testing for cannabis last summer, many employers are keeping their decision quiet. The percentage of specimens tested for THC declined 6.7 percent nationwide in 2021 from 2020, while that figure fell by 10.3 percent in states where recreational marijuana is legal, according to Quest’s data.

What many employers considered a best practice for years now is being reconsidered. Yet, the objectives of drug testing – to promote a safe and healthy workplace, mitigate legal risk, keep employees accountable, and comply with federal and state laws are still very real. Employers that choose to stop pre-employment testing for marijuana increase the danger of more drug-related impairment and worksite accidents as well as exposure to negligent hiring claims, if they don’t find another way to ensure employees are not coming to work under the influence of cannabis.

Many experts suggest a robust reasonable suspicion program. Managers are trained to identify when a worker may be high such as erratic behavior, sleeping on the job, red eyes, slurred speech, uncoordinated movements, slow reaction time, and the odor of marijuana. When the behaviors have been properly documented with HR, the employee is sent for drug testing. It’s also a good idea to check the employee’s social media, which may provide supporting information. While a reasonable suspicion testing program should be an integral component of a substance abuse policy, it’s critical when pre-employment marijuana testing is eliminated or where there are limitations on the use of a positive result.

This is an issue where “no one size fits all,” and will depend on the industry, federal, state, and local laws, position-specific questions surrounding job duties, and the workplace culture. However, given the rapid expansion of marijuana laws and the persistent labor shortage, it’s clear employers need to face this tough decision.

Claim costs jumped in second half of 2021

According to a report from Mitchell International Inc, as of December 2021, the average indemnity cost for a COVID-19 claim increased 40% when compared with data in June 2021 to about $3,478 per claim. Average medical costs went up 76% to about $10,162 per claim. The percentage of COVID-19- related claims with only indemnity costs has remained steady since the start of the pandemic.

However, the report notes that it “believes a small number of large dollar claims have inflated the average.” Only 12 percent of COVID-19 related claims had over $4,000 in indemnity paid, and four percent had over $10,000 in indemnity paid.

Study confirms relationship between increased cost of COVID claims and age of employee

According to a recent study, an employee’s age at the time of COVID-19 infection is the major factor associated with prolonged impairment and high costs of COVID-19 workers’ compensation claim. Other key findings are: five percent of claims had 30 days or longer of lost time accounting for 65% of total paid WC costs; medical costs increased eight-fold once paid days lost crossed the threshold of 60 days or greater; 32 percent of workers’ compensation claims with 60 or more days of lost time were not closed at the end of the study, indicating that the costs of those claims would continue to increase.

Long-COVID creates uncertainty

Many insurers believe that the biggest risk to the Workers Compensation system related to COVID-19 now is the unknown long-term health implications for workers who suffer from what has come to be known as Long-COVID, symptoms that linger long after the infection. It’s complicated on many fronts – symptoms can vary significantly from person to person, even those with mild and possibly unreported cases can develop Long-COVID (the pervasiveness is estimated at 10 to 30 percent of all cases), there is no diagnostic category, and the issue of work-relatedness and association with original COVID claims can be daunting.

Compensability aside, those experiencing long-haul symptoms may have functional impairments that affect their productivity. Extreme fatigue and brain fog can impede performance, but the condition can be sporadic, creating uncertainty for employees and managers. Employees can also experience anxiety or depression. In a recent blog, Sedgwick Claims Management Services Inc. suggests monitoring workers’ compensation disability and leave of absence claim counts and durations is essential to grasp the scope of the organizational impact of long COVID. It’s also noted that, “Employers can benefit from engaging in an interactive accommodation process, collaborating with employees on the nature, severity, duration and resulting limitations of their extended COVID-related impairment.”

EEOC gets over 6,000 COVID-19 discrimination complaints

Between April 2020 and December 2021 more than 6,000 discrimination charges related to COVID-19 and more than 2,700 separate vaccine-related charges were filed. The majority of the EEOC discrimination charges claimed violations of the Americans with Disabilities Act (ADA), whereas only about 11 percent of the vaccine-related claims did so.

The EEOC offers extensive guidance on its website on how to avoid discriminating against your employees. Employers are encouraged to be cautious about religious accommodation requests but are reminded they do not have to offer the accommodation the employee wants and that every request should be determined on a case-by-case basis.

As more employers are returning employees to the workplace, the EEOC noted in a recent webinar that teleworking should be at least considered a reasonable accommodation so long as the employee can perform the essential functions of the job. It also reminded employers that COVID-19 can be an ADA qualifying disability, but not always.

NCCI continues to update its resources

The National Council on Compensation Insurance (NCCI) had updated its Medical Indicators & Trends dashboard, which provides an accounting of COVID-19 treated claims, with detailed state-specific Medical Data Reports that include summarized statistics such as impacts to physician services, time to treatment, telemedicine, prescription drugs, hospital outpatient and ambulatory surgical center visits, and COVID-19 treated claim characteristics.

It also continues to update state regulatory and legislative activity related to 2022 COVID-19 workers compensation compensability, including presumption.

“Take-home” COVID-19 liability still alive in California

The California Supreme Court denied a request to review See’s Candies Inc. v. Los Angeles Superior Court, which held the derivative injury doctrine doesn’t preclude a lawsuit alleging a business negligently exposed a worker to COVID-19 that resulted in the death of a family member. This issue may return to the Supreme Court as the U.S. 9th Circuit Court of Appeals in San Francisco asked the Supreme Court to assess whether the derivative injury doctrine prohibits a civil claim against an employer when a worker contracts COVID-19 in the workplace and brings the virus home and whether California law imposes on employers a duty to households of its employees to exercise ordinary care to prevent the spread of COVID-19.

The case, Kuciemba v. Victory Woodworks, involves a construction worker who contracted COVID-19 and infected his wife, who became seriously ill. While a federal district court for Northern California granted a motion to dismiss, finding the derivative injury doctrine barred the wife’s claims and that the employer didn’t owe the wife any duty, the appeals court said it was appropriate to certify the questions for the state Supreme Court to answer because there is no controlling precedent.

California’s third readoption of COVID-19 emergency rule took effect May 6

Effective from May 6 to December 31, 2022, this third readoption continues to place significant obligations on employers, including the obligation to pay “exclusion pay” to employees who have been excluded from the workplace as a COVID-19 case or a close contact. There are some significant changes, including:

  • Testing must be offered to all employees with COVID-19 symptoms regardless of vaccination status. Also, respirators must now be available to all employees upon request. (Previously both applied only to unvaccinated workers.)
  • No specific rules for close contact exclusions, although the ETS maintains its definition of close contact. The Department of Public Health (CDPH) guidance to prevent COVID-19 transmission from close contact shall be followed.
  • The restriction prohibiting self-administered and self-read tests only applies to return to work. To meet the return-to-work criteria, a test may be both self-administered and self-read only if an independent verification of the results can be provided (such as a time-stamped photograph of the results).
  • The requirement that light does not pass through a mask when it is held up to a light source was deleted.
  • A definition of “returned case” is added, referring to employees who had COVID and returned to work and did not develop any symptoms after returning. Generally, an employee can be considered a return case for 90 days.
  • Face coverings are no longer mandatory for unvaccinated workers.
  • Cleaning and disinfection requirements as well as partition requirements were eliminated.
Federal COVID-19 vaccination directive reinstated

A requirement for federal workers to be vaccinated against the coronavirus was recently upheld on the jurisdictional ground by a federal appeals court panel. The groups that challenged the vaccination directive, however, could ask the full appeals court or the U.S. Supreme Court to review the matter.

Law firm survey finds most employers relaxing COVID standards

Seventy-one percent of employers are planning to relax or lift COVID-19 workplace protocols, 83 percent of which are relaxing mask protocols, according to a survey by the Philadelphia-based law firm Blank Rome LLP. Over half (51 percent) are not making COVID-19 vaccines mandatory for current employees – but 38 percent are, which is up from the 15 percent who reported doing so in July 2021.