Local Educational Agencies And Other Public Agencies Subject To New Rebuttable Presumption Standard for COVID-19 Workers’ Compensation Claims

10.06.2020

Under a new law, Senate Bill (“SB”) 1159, that took effect on September 17, 2020, most California workers, including employees of  local educational agencies and other public agencies, who test positive for COVID-19 during an “outbreak” at the employee’s “place of employment,” as defined, will be presumed to have contracted COVID-19 in the course of their employment, entitling the employees to workers’ compensation benefits.

A broader presumption, first established by Governor Newsom’s Executive Order N-62-20, (which expired on July 5, 2020), was also codified for certain “first responders.”  Those workers will be presumed to have contracted COVID-19 at work if they contracted the illness within 14 days of working at their place of employment, regardless of whether an “outbreak” occurs.

When Does SB 1159 Take Effect?

SB 1159 took effect immediately on September 17, 2020 as an urgency statute, and will expire on January 1, 2023. 

Who Is Covered Under SB 1159?

Public employees, including those employed by cities, counties, school districts, county offices of education, community college districts, law enforcement agencies, transit agencies, water districts, and other special districts (“public employers”), are covered if they work for a public employer with five or more employees. .  First responders and healthcare workers are covered regardless of employer size.

How Does the Presumption Work?

For first responders and healthcare workers:

First responders and healthcare workers (as defined by Labor Code Section 3212.87 to include, for example, firefighters, peace officers, and nurses) will be presumed to have contracted COVID-19 at work if all of the following conditions are met:

1. The employee has tested positive for COVID-19 within 14 days after a day in which the employee performed labor or services at the employee’s place of employment, as defined, at the employer’s direction; and
2. The last day that the employee performed labor or services at the employee’s place of employment, as defined, at the employer’s direction, was on or after July 6, 2020.

For all other employees of an employer with five or more employees:

The rebuttable presumption that all other employees contracted COVID-19 at work will apply if all of the following conditions are met:

1. The employee tests positive for COVID-19 within 14 days after a day that the employee performed labor or services at the employee’s place of employment, as defined, at the employer’s direction;
2. The last day that the employee performed labor or services at the employee’s place of employment, as defined, at the employer’s direction, was on or after July 6, 2020; and
3. The employee’s positive test occurred during a period of an “outbreak,” as defined below, at the employee’s specific place of employment.

An “outbreak” is defined to exist if within 14 calendar days, any one of the following occurs at a specific place of employment:

1. If the employer has 100 or fewer employees at a specific place of employment, four employees test positive for COVID-19;
2. If the employer has more than 100 employees at a specific place of employment, four percent of the number of employees who reported to the specific place of employment test positive for COVID-19; or
3. A specific place of employment is ordered to close by a local public health department, the State Department of Public Health, the Division of Occupational Safety and Health, or a school superintendent due to a risk of infection with COVID-19.

A “place of employment” is defined as the building, store, facility, or agricultural field where an employee performs work at the employer’s direction.  A “place of employment” generally does not include an employee’s home or residence for those working remotely.

We note that employees may still file a workers’ compensation claim for a COVID-19 job-related injury or illness even if the presumption does not apply to them.  Employees who do not qualify for the rebuttable presumption under SB 1159 may still be eligible to receive workers’ compensation benefits if they contracted COVID-19 at work and are able to prove that their injury or illness arose out of their employment.

How Can an Employer Rebut the Rebuttable Presumption?

Even when an employee is presumed to have contracted COVID-19 at work, an employer may dispute the presumption by providing:

• Evidence of measures in place to reduce potential transmission of COVID-19 in the employee’s place of employment, such as provision and requirement for PPE; and
• Evidence of an employee’s nonoccupational risks of COVID-19 infection.

If the date of injury falls before July 6, 2020, which is subject to the rules established by Executive Order N-62-20, the claim administrator has 30 days to deny the claim.  If the date of injury falls on or after July 6, 2020, the claim administrator has 45 days to deny the claim, or the injury is presumed compensable.  These presumptions of compensability (arising from late denial of a claim) are rebuttable, but only with evidence discovered subsequent to the applicable investigation period.  Unless controverted, the appeals board is bound to find in accordance with the presumption.

To What Compensation Benefits Are Employees Entitled?

If the presumption stands, compensation could include full hospital, surgical, medical treatment, disability indemnity, and death benefits.

However, if an employee has paid sick leave benefits specifically available in response to COVID-19, those benefits must be exhausted before any temporary disability benefits are due and payable.  If an employee does not have supplemental paid sick leave benefits, the employee must be provided temporary disability from the date of disability (i.e. there is no waiting period). 

The date the employee tests positive or is diagnosed with COVID-19 determines how the employee qualifies for temporary disability benefits:

• On or after May 6, 2020: the employee must be certified for temporary disability within the first 15 days after the initial diagnosis, and must be recertified for temporary disability every 15 days thereafter, for the first 45 days following diagnosis. 
• Before May 6, 2020: the employee must have obtained a certification no later than May 21, 2020 documenting the period for which the employee was temporarily disabled and unable to work, and shall be recertified for temporary disability every 15 days thereafter, for the first 45 days following diagnosis.

New Reporting Requirements For Employers

When an employer knows or reasonably should know that an employee tested positive for COVID-19, the employer must report all of the following to its claims administrator by email or fax within three business days:

1. An employee tested positive for COVID-19;
2. The date that the employee tested positive (the date the specimen was collected for testing);
3. The address or addresses of the employee’s specific place of employment during the 14-day period preceding the date of the employee’s positive test;
4. The highest number of employees who reported to work at the employee’s specific place of employment in the 45-day period preceding the last day the employee worked at each specific place of employment.

Any employer who is aware of an employee who tested positive between July 6, 2020 and September 17, 2020 must report the incident to its claims administrator in writing via email or fax within 30 business days of September 17, 2020.  The claims administrator will then use the information reported to determine if an outbreak has occurred between July 6, 2020 and September 17, 2020.

An employer or other person acting on behalf of an employer who intentionally submits false or misleading information or fails to submit information will be subject to a civil penalty in the amount of up to ten thousand dollars ($10,000) to be assessed by the Labor Commissioner.

Please contact the authors or your usual counsel at AALRR if you have any further questions about SB 1159 and how it pertains to your organization.

This AALRR publication is intended for informational purposes only and should not be relied upon in reaching a conclusion in a particular area of law. Applicability of the legal principles discussed may differ substantially in individual situations. Receipt of this or any other AALRR publication does not create an attorney-client relationship. The Firm is not responsible for inadvertent errors that may occur in the publishing process.

©2020 Atkinson, Andelson, Loya, Ruud & Romo