New CA Laws Address COVID-19 Workers’ Compensation Claims and Employer Reporting When Employee Tests Positive for COVID-19

New CA Laws Address COVID-19 Workers’ Compensation Claims and Employer Reporting When Employee Tests Positive for COVID-19

The California Senate Bill 1159 and Assembly Bill 685 were signed into law on September 17, 2020. SB 1159, which took effect upon signing, creates a disputable presumption for workers’ compensation claims related to COVID-19 on or after July 6, 2020 through January 1, 2023. AB 685, effective January 1, 2021, includes an employer reporting requirement for all positive COVID-19 employee test results. Employers and claims administrators must investigate a claim quickly to take advantage of the disputable presumption, and ensure measures are taken to reduce potential transmission of COVID-19 within the work environment.

The Presumption

The law begins with a presumption that an illness or death resulting from COVID-19 arose out of and in the course and scope of employment if the employee tests positive during a period of an outbreak at work, assuming the employer has five or more employees. An outbreak exists if within 14 days one of the following occurs at a specific place of employment:

  • If the employer has 100 or fewer employees, four employees test positive for COVID-19
  • If the employer has more than 100 employees, 4% of the number of employees who reported to the specific place of employment test positive for COVID-19
  • 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

In addition, the new law adds rebuttable presumptions for certain essential employees (including but not limited to first responders, firefighters, peace officers and healthcare professionals) who test positive for COVID-19 within 14 days of the last date the employee performed work at the specific place of employment. “Specific place of employment” is defined as a “building, store, facility, or agricultural field where an employee performs work at the employer’s direction,” but excludes an employee’s residence, unless the employee performs home healthcare services. There is no guidance on employees who work outside or in customers’ homes.

Available Benefits

If the presumption applies, the employee is entitled to “full hospital, surgical, medical treatment, disability indemnity, and death benefits.” SB 1159 requires paid sick leave, such as leave available under the Families First Coronavirus Act (FFCRA), to be exhausted before the employee can use temporary disability benefits under SB 1159; however, if the employee is not eligible for such benefits, the temporary disability benefits must be provided without the traditional three-day waiting period.

What Employees Must Provide Their Employer

If the employee tests positive for or is diagnosed with COVID-19 on or after May 6, 2020, the employee must be certified for temporary disability by a licensed physician within the first 15 days after the initial diagnosis, and then must be recertified every 15 days thereafter for the first 45 days following diagnosis.

If the employee tested positive or was diagnosed with COVID-19 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 must have been recertified for temporary disability every 15 days thereafter for the first 45 days following diagnosis.

The Presumption Disputed

The presumption may be disputed with evidence such as: 1) employer’s efforts to reduce potential transmission of COVID-19 in the employee’s place of employment, 2) the employee’s non-occupational risks of COVID-19 infection, 3) statements made by the employee and 4) any other evidence normally used to dispute a work-related injury.

If the date of injury is on or after July 6, 2020, the claim administrator now has 45 days to deny the claim, or the injury is presumed compensable. However, if date of the injury is before July 6, 2020, or the employee is an “essential employee” as specified in Labor Code Section 3212.87, then the 30-day denial period applies. 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.

New Reporting Requirements

Additionally, the new law creates reporting requirements for the employer to the workers’ compensation carrier concerning information about any employee who tests positive for COVID-19.

Employers must notify their workers’ compensation carrier within three days of learning that an employee has tested positive for COVID-19. The employer must provide the date of the test, the employee’s worksite 14 days prior to the test, and the number of employees at each work site where the employee worked 45 days prior (personal identifying information is excluded).

The claims administrator will use the above information to determine whether an outbreak has occurred. 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.

If you have questions about SB 1159 and AB 685 and how they may affect your organization, NFP is available. Contact your advisor today.