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Legal Updates

CA Legislature Passes SB 1159- Retroactive COVID-19 Presumption

Employers must remain hyper-vigilant to COVID-19 and must report a positive test of an employee within three days to their claims administrator.

Background

We knew that the legislative framework would soon follow the Governor’s patchwork executive order, and that indeed is what occurred with SB 1159.

On August 31, 2020, California legislature passed SB 1159 and declared it an “emergency measure” that applies to pending claims relying on the prior Executive Order.

To briefly recap, the May 6th executive order stated that “[a]ny COVID-19-related illness of an employee shall be presumed to arise out of and in the course of the employment for purposes of awarding workers’ compensation benefits” if the positive test/diagnosis was within 14 days of an employee performing labor at/for their place of employment on or after March 16th 2020, and that place of work was not in the employees home, and the diagnosis is confirmed by further testing within 30 days.  

The emergency measure means that SB 1159 will take effect immediately upon the signature of the governor (rather than wait until Jan. 1).   Gov. Newsom has until September 30, 2020 to either sign or veto the bill.  It is expected to be signed into law.

Highlights of the Bill

This bill would extend injury for an employee to include illness or death resulting from the 2019 novel coronavirus disease (COVID-19) under specified circumstances, until January 1, 2023.

Until January 1, 2023, the bill would allow for a presumption of injury for all employees whose fellow employees at their place of employment experience specified levels of positive testing, and whose employer has 5 or more employees.

The bill would also make a claim relating to a COVID-19 illness presumptively compensable,  after 30 days or 45 days, rather than 90 days.  During the investigation phase, the presumption is “disputable,” and thereafter, it may still be “rebuttable.”  The legislature’s use of the “disputable” and “rebuttable” terms in the bill is cause for discussions and debate.  

SB 1159 defines “outbreak” of COVID-19 for employers under 100 employees, as four employees testing positive during a two week period, or for more than 100 employees, 4% of the workforce.

What Does This Mean for Employers?

Employers will have to continue to be hypervigilant well into the future, as COVID-19 as a presumed work injury/illness will last in our workers’ compensation system for at least the next two years.

An employer has to report a positive test of an employee within three days to their claims administrator.

Employers and carriers will have more administrative and reporting duties:  Employers will have to report positive tests to their insurance carriers, who are also tasked with assessing causal connections between employees and assessing workplace safety, to some degree.   Specifically, an employer has to report a positive test of an employee within three days to their claims administrator.

The onus is on employers to have safety measures and containment measures in place to prove there is not an “outbreak” after a positive test.   Specifically, an employer has to report the last day the infected employee worked and then the highest number of employees who worked the 45 days preceding, so that an “outbreak” can be determined or not.  A positive test for one employee can have ripple effects in the workplace, so monitoring of that effect is imperative.  

There was a small token of relief to employers as investigation of potential claims in order to rebut was extended to 45 days.

--CB Everett, Managing Partner