On September 17, 2020, California Governor Gavin Newsom signed SB 1159 into law, which is effective immediately for all employers. The law does five things: (1) it codifies Governor Newsom’s Executive Order N-62-20 on a disputable presumption for all mandatory on-site workers for workers’ compensation for confirmed COVID-19 cases between March 19, 2020, and July 5, 2020; (2) it defines an “injury” under workers’ compensation to include illness or death resulting from COVID-19; (3) it creates a “disputable presumption” for workers’ compensation for certain Essential Employees (defined below) and employees working at places of employment where there has been an Outbreak (defined below), who suffer illness or death from COVID-19 on or after July 6, 2020, through January 1, 2023, that such illness or death arose out of and in the course and scope of employment; (4) it creates reporting requirements for employers to claims administrators; and (5) it creates civil penalties for employers who fail to meet such reporting requirements.
SB 1159 creates a “disputable presumption” under workers’ compensation statutes for certain employees with confirmed cases of COVID-19.
Which employees are subject to this disputable presumption? The disputable presumption covers three categories of workers.
Workers covered under Executive Order N-62-20, which created the disputable presumption for all California employees who worked outside of their homes between March 19, 2020, and July 5, 2020. Under the Executive Order, if such an employee tested positive (or was diagnosed by a physician and later confirmed positive by a test within 30 days of diagnosis) for COVID-19 within 14 days of working at their place of employment, they are presumed to have contracted COVID-19 at work for the purposes of awarding workers’ compensation benefits.
Certain Essential Employees (including, but not limited to front-line workers, such as firefighters, peace officers, emergency medical services providers and certain healthcare workers).
The presumption does not apply to healthcare workers who do not provide direct patient care, or custodial employees if the employer can establish that the employee did not have contact with a patient who was positive for COVID-19 within the last 14 days.
Workers for whom the following conditions are established:
The worker’s employer has five (5) or more employees;
The worker tests positive for COVID-19 (or is diagnosed with COVID-19 by a medical professional acting under standard procedure and has such diagnosis confirmed by a test within 30 days of the diagnosis) within 14 days of working at their place of employment; and
The worker tests positive (or is diagnosed) during an Outbreak.
For the third category of employees, what is an Outbreak? An Outbreak exists if, within 14 calendar days, one of the following occurs at a specific place of employment:
If 100 or fewer employees, four (4) employees test positive for COVID-19;
If more than 100 employees, 4% of the number of employees test positive for COVID-19; or
It is ordered to close by a local public health department, the California Department of Public Health (CDPH), Cal/OSHA or a school superintendent due to risk of infection of COVID-19.
What is the disputable presumption? The disputable presumption is that the confirmed COVID-19 illness or death (until January 1, 2023) arose out of or in the scope and course of employment and is compensable.
How can employers dispute the presumption? The employer may dispute it with:
Evidence that it had COVID-19 safety measures in place to reduce potential transmission of COVID-19;
Evidence of the employee’s risk for COVID-19 outside the workplace; employee’s non-occupational risks of COVID-19 infection;
Statements made by the employee; and
Any other evidence normally used to dispute a work-related injury.
How much time does the employer have to dispute the presumption?
If the injury is dated before July 6, 2020, or the employee is an Essential Employee, then the claim administrator has only 30 days to review and deny the claim, or the injury is presumed compensable.
If the injury is dated on or after July 6, 2020, then the claim administrator has 45 days to review and deny the claim.
If the claims administrator finds that the presumption applies, then the employer can dispute the presumption, but only with evidence discovered after the applicable review period.
Unless controverted, the appeals board is bound to find in accordance with the presumption.
If the appeals board finds in accordance with the presumption, the employee is entitled to full benefits, subject to certain certification and exhaustion procedures for temporary disability benefits.
What are full benefits? If the presumption applies, then the employee is entitled to “full hospital, surgical, medical treatment, disability indemnity, and death benefits,” except the Department of Industrial Relations has waived the right to collect death benefit payments arising from individuals without dependents.
Does this mean an employee automatically gets temporary disability benefits for COVID-19? Not necessarily. To be entitled to temporary disability benefits, the employee must: (i) be certified for temporary disability; and (ii) must also first exhaust all COVID-19 paid sick leave benefits available to the employee, such as those available under the Families First Coronavirus Response Act (FFCRA).
The employee’s certification for temporary disability must be by a licensed physician.
If the employee tests positive or is diagnosed with COVID-19 on or after May 6, 2020, the employee must be certified within 15 days after the initial diagnosis, and then must be recertified every 15 days for the first 45 days following the positive test or diagnosis.
If the employee tested positive, or was diagnosed with COVID-19 before May 6, 2020, then the employee needed to have obtained a certification from a licensed physician by May 21, 2020, documenting the period of temporary disability, and then have had the disability recertified every 15 days for the first 45 days following the positive test or diagnosis.
COVID-19 Paid Sick Leave Benefits If an employee does not have any COVID-19 paid sick leave available to them, then there is no waiting period, and the employee must be provided temporary disability benefits from the date of the disability.
SB 1159 also creates reporting requirements for the employer to the workers’ compensation claims administrator. Note that workers’ compensation claims administrators will then use the information reported by the employer to determine if an Outbreak (defined above) has occurred for purposes of administering a claim.
What are the reporting requirements?
Notice that an employee tested positive (without providing personally identifiable information);
The date the employee tested positive;
The address(es) of the employee’s place(s) of employment during the 14 days preceding the positive test.
For positive tests/diagnoses between July 6, 2020, and September 17, 2020, the employer must report the above via email or fax, to its claims administrator by October 29, 2020, and must also include: The highest number of employees who reported to work at the diagnosed employee’s place(s) of employment on any work date between July 6, 2020, and September 17, 2020.
For positive tests/diagnoses on or after September 17, 2020, the employer must report the above via email or fax to its claims administrator within three (3) business days of when the employer knows (or reasonably should know) an employee tested positive for COVID-19, and must also include: The highest number of employees who reported to work at the diagnosed employee’s place(s) of employment in the 45-day period preceding the last date the employee worked at each place.
Employers who fail to properly report this information to the claims administrator could be subject to penalties.
What are the penalties? Employers who fail to report the above information, or who “intentionally submit false or misleading information” are subject to a $10,000 penalty assessment by the California labor commissioner.