It is hard to believe now, but in 1941, the United States had only been in one war outside North America. Since the anarchists of the early 20th century were history, terrorism was almost unherad of.
So, lawmakers displayed rare foresight when they passed the Defense Base Act. Although there were virtually no overseas private military contractors at the time, the DBA provides compensation for these individuals when they are injured overseas.
In 1942, to account for the growing presence of non-military contractors, Congress extended the DBA to cover construction contractors working overseas. Finally, in 1956, the government extended DBA benefits to noncitizens working as forign military contractors.
What is Contingency Contracting?
This term is sometimes used to describe DBA eligible-positions. According to the Dod, “Contingency contracting is direct contracting support to tactical and operational forces engaged in the full spectrum of armed conflict and military operations (both domestic and overseas), including war, other military operations, and disaster or emergency relief.” That is a broad definition that includes most overseas private contractors.
ACE USA, AIG, and CNA write most of the DBA insurance policies. These policies provide no-fault benefits that pay lost wages and medical expenses.
Just like the definition of “contingency contractor” is broad, the definition of a work-related injury is also broad. In most workers’ compensation systems, like state-run workers’ comp systems and the Jones Act, victims must establish a connection between the covered activity and the illness or injury.
The DBA is different. Victims must only establish a nexus, or indirect relationship, between the covered activity and the injury or illness. Essentially, if you were injured overseas, whether you were on the clock or not and whether the injury had anything to do with your deployment or not, DBA benefits are probably available.
Who Does the DBA Cover?
The contingency contractor category is not just theoretical. If you worked in any of the following capacities, there is a presumption of DBA coverage:
- Private military contractor in any foreign country or any U.S. territory acquired after 1941,
- Any work on any overseas construction or service contracts which are related to national defense,
- Overseas employment in any project connected to the Foreign Assistance Act, such as sales of military services, equipment, or supplies to U.S. allies,
- USO or other overseas workers who perform morale or social services, and
- Workers on any public works project outside the United States.
There are severe financial penalties for covered firms who fail to provide DBA insurance. Moreover, these victims might be able to sue outside the system and obtain additional compensation.
On a related note, if the overseas employer acted recklessly, additional compensation might be available as well. Examples include a construction contractor who does not give safety equipment to workers and a military contractor who does not furnish body armor.
The additional compensation usually includes money for pain and suffering, loss of consortium (companionship), emotional distress, loss of enjoyment in life, and other noneconomic damages. More on this below.
What are Some Technical Requirements?
Immediately upon illness or injury, victims must file written reports with their immediate supervisors. Email might not be good enough. It is best to give both electronic and snail mail notice.
Within one or two years, depending on the type of illness or injury, victims must file comprehensive LS 203 forms.
These filing deadlines are problematic in occupational disease DBA claims, such as toxic exposure or hearing loss. Generally, contractors do not run to the doctor as soon as they have any trouble hearing or develop a persistent cough. Additionally, medical treatment might not be complete, even a year or two later.
A variation of the discovery rule protects victims in these situations. The deadlines do not apply until the victim knows the full extent of injury and connects that injury with a work-related condition.
Do I Get Lost Wages?
The DBA is no-fault insurance. Since victims need not prove negligence, their compensation is limited to economic losses.
To see how the wage replacement benefit works, let us look at a hypothetical example. Assume Mike is an overseas construction contractor. As he works on the ground floor, someone drops a hammer a few stories above him. The hammer lands on Mike’s shoulder.
Apropos of nothing, these struck-by injuries are among the most common, and most serious, construction site injuries. There is an old story about a penny dropped from the top of the Empire State Building being fatal to a pedestrian on the street. That story is mostly false, but it has some factual basis.
Anyway, the doctor prescribes surgery on the shoulder followed by three weeks of complete rest. Mike is obviously unable to work during this period. So, the DBA pays two-thirds of his average weekly wage while he is unable to work.
After the rest period ends, Mike’s doctor clears him for limited work and tells him to start physical therapy. However, he is in no condition to go back to the construction site. So, he files paperwork in the office and so on. Office workers earn a lot less than construction supervisors. Therefore, the DBA pays two-thirds of the difference between Mike’s old and new salaries to compensate him,
When his physical therapy ends, Mike still has some permanent loss of function in his shoulder. He will never be 100% again. A shoulder injury is usually a scheduled injury under 33 U.S.C. 908. Mike is probably entitled to some additional compensation, depending on the nature and extent of his permanent injury.
Other injuries, mostly totally disabling injuries, are unscheduled. Compensation is available in these cases, but the evaluation process is more subjective.
What About Medical Bills?
Generally, the DBA pays all reasonably necessary medical bills. These expenses include:
- Emergency care,
- Follow up care,
- Physical therapy, and
- Ancillary expenses, like prescription drugs, medical devices, and transportation expenses.
Essentially, the DBA is designed to pay for all medical expenses. Injured workers should never have to pay these costs from their own pockets.
Generally, victims have a right to choose their own doctors and change physicians during the course of treatment. As a result, many victims get second opinions, especially about an occupational disease diagnosis. So, in terms of financial compensation, these cases are often rather complex.
Connect with Barnett, Lerner, Karsen, Frankel & Castro, P.A. to learn more about DBA procedure.