The Defense
Base Act provides disability, medical, and death
benefits to covered employees 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
$1,256.84 per week.
payable for partial loss of earnings under the
Defense Base Act. 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. There
is no minimum compensation rate under the Defense
Base Act. Click the icon to download the Defense
Base Act Insurance Application. The injured employee is entitled to
medical treatment by a physician of his/her choice,
as the injury may require. Medical benefits may not
be commuted.
Background:
Established in 1941, the primary goal of the Defense
Base Act was to cover workers on military bases
outside the United States. The Defense Base Act was
amended to include public works contracts with the
government for the building of non-military projects
such as dams, schools, harbors and roads abroad. A
further amendment added a vast array of enterprises
revolving around the national security of the United
States and its allies. Today, almost any contract
with an agency of the U.S. government, for work
outside the United States, whether military in
nature or not, will likely require Defense Base Act
coverage.
In the current version of the Defense Base Act,
there are five provisions that prompt coverage:
Any employee working on a military
base or reservation outside the U.S.
Any employee engaged in U.S. government funded public
works business outside the U.S.
Any employee engaged in public works or military
contract with a foreign government which has been deemed necessary to
the U.S. National Security.
Those employees that provide services funded by the
U.S. government outside the realm of regular military issue or channels.
Any employees of any sub-contractors of the prime of
letting contractor involved in a contract like numbers 1 - 4 above.
Waivers:
One should note that DBA coverage makes no reference to the
nationality of covered employees: thus, local nationals or third country
nationals are automatically covered under the DBA. Waivers can be
granted, but they need to follow certain criteria, and only the
Secretary of Labor is able to authorize any such waiver.
Coverage Issues
The courts rely on
precedent when determining liability issues.
Two doctrines known as the Zone of Special Danger
and Reasonable Recreation are central to finding
coverage under the Act. The Zone of Special
Danger doctrine requires that an employee’s injury
or death occurs arising out of or in the course of
employment. In addition, the Zone of Danger
states that where there exist unique conditions or
circumstances of employment which place an employee
in a zone of danger, then an accident resulting in
injury or death need not be strictly related to job
duties. The Reasonable Recreation doctrine
requires that an employee’s injury or death occur
arising out of or in the course of the employer’s
furnished, funded or promoted recreational
activities. Some non-sponsored activities may also
be included. Please note that these two
doctrines taken together do not lead to “24 Hour
Coverage” for an employee.
Failure to
obtain DBA insurance
carries stiff penalties. All government
contracts contain a provision that requires bidding
contractors obtain necessary insurance.
Failure to do so will result in fines and possible
loss of contract. The additional and the most
severe penalty is that the employers without DBA
coverage are subject to suits under common law
wherein common law defenses are waived. In others
words, the claimants or their heirs need only file
suit and do not have to prove negligence.
Lastly, all claims may be brought in Federal Court
and are against the insured directly.
We are here to help. At Black Fox
International, we want to be sure that our clients
get the Defense Base Act coverage they must have and
we also want to make sure that we fill any and all
gaps that could cause our clients unexpected losses.
Travel Accident, War Risk and assistance services to
employees are just a few of the areas to cover; Let
us put our experience to work for you.
