Workers' comp coverage gaps with remote workers

In this post-pandemic world, it’s become clear to most employers that work-from-home arrangements are here to stay. Most employees and employers have adjusted to this “new normal” in many respects — after all, we’ve now had over two years of practice and learned that many workers can be just as efficient in a remote work setting. Still, there are many issues that employers have yet to grapple with or address. Employees in the workplace are protected by both state and federal laws. One issue that many employers may not have yet considered is whether employees must be covered by workers’ compensation insurance if they are injured while working at home. For employers who permit employees to work remotely from other states, the answer may depend on the precise state law that applies to the employee’s physical work location.

Is the remote worker covered?

Nearly all employers are required to carry workers’ compensation insurance if they have even one employee. Workers’ compensation insurance provides benefits to employees who are injured “in the course of employment.” While every state is slightly different, most employees are entitled to have their medical bills paid and receive wage replacement benefits if they are unable to work during recovery. For more serious injuries, employees may receive permanent disability benefits or impairment benefits on a long-term basis.

In the past, workers’ compensation was largely only relevant if the employee was injured in the workplace or while temporarily away from the workplace performing work-related duties. Remote workers, on the other hand, typically work from their homes, so the risk is that they may sustain injuries while in their own homes.

Because each state has different laws, it’s not surprising that the issue of whether a remote worker is covered under workers’ compensation insurance plans has been interpreted differently in various states.

One Florida court considered the issue of whether a remote worker was covered when she was injured after tripping over her dog while taking a coffee break in her own kitchen. The court determined that reaching for the coffee cup was not an action that “arose out of employment,” so the injured employee was not entitled to receive workers’ compensation benefits.

On the other hand, a court in Pennsylvania found that an injured remote worker was entitled to workers’ compensation when she was injured by falling down the stairs while returning to her workstation after getting a glass of juice. The court applied a “personal comfort doctrine” and found that the employee was entitled to take breaks during working hours and remained covered under workers’ compensation.

Action steps for employers with remote employees

In both cases described above, the employee was injured while taking a break during working hours established by work-from-home agreements with their employers. When it came to the workers’ compensation determination, the results were different for each.

Unfortunately, employers who permit employees to work remotely in various states will have to consider the state laws that apply in each state where a remote worker is present.

First and foremost, employers who permit remote work arrangements should know exactly where their employees are performing their work duties. They should also review their workers’ compensation policies and determine whether there are any special terms that apply to remote workers. Some policies specifically exclude remote employees who work in other states, meaning that the employer may be required to purchase additional coverage — or be left on the hook for covering expenses if a remote employee is injured.

Employers should also ensure that their employees are aware of the correct procedures should an injury occur. Employees should know how to report any injury that occurs in a remote workspace and supervisors should be educated about how to respond properly to avoid future litigation.

Some employers may also wish to revise their remote work policies entirely. They could require employees to continue working in the state where the business is physically located. Other employers may wish to provide information on creating a safe work environment at home or even require periodic inspections by the employer.

Related: Best workers’ comp insurance in 2022

Workers’ compensation issues are complicated even without remote worker issues. Employers who permit remote work arrangements should ensure that they’re up to speed on the requirements of each state where employees are physically present to prevent future problems.

Robert Bloink, Esq., LL.M., has taught at the Texas A&M University School of Law and the Thomas Jefferson School of Law.

William Byrnes, Esq., LL.M., CWM, is an executive professor and associate dean of special projects at the Texas A&M University School of Law.

Opinions expressed here are the authors’ own.