Keenan Blog

COVID-19 Update: Workers’ Compensation Presumption Bills

May 27, 2020

In the beginning of May, the California Legislature returned to the Capitol after weeks of hiatus due to the COVID-19 pandemic.Although the Legislature is hearing fewer bills and is on an abbreviated schedule, there are still a few significant bills working their way through committees. Most notably for employers, the Legislature continues to try to enact a statutory COVID-19 presumption for workers’ compensation, despite the Governor’s May 6, 2020 Executive Order N-62-20, which established a time-limited and rebuttable presumption for certain employees. At present, the legislature is considering three COVID-19-related presumption bills, as summarized below.

SB 1159—This bill would create a statutory rebuttable presumption that an illness or death of a “critical worker” related to COVID-19 is an occupational injury for the purposes of workers’ compensation. The bill defines a critical worker as a “public or private sector employee who is employed to combat the spread of COVID-19” and has had direct interaction with the public during the COVID-19 pandemic. The injury must develop or occur during a period in which the critical worker is in the service of an essential critical infrastructure employer. At the time of publication of this blog, the bill is a work in progress with certain definitions (i.e., “critical infrastructure employer”) missing and critical terms (i.e., the sunset date of the presumption) left blank.

Stakeholders continue to negotiate over the need for and the contours of the bill, especially in light of Executive Order N-62-20. While SB 1159 appears to apply to a narrower group of employees than the executive order, it is intended to apply for a longer period of time. Democrats on the Senate Health Committee see SB 1159 as an opportunity to both codify and clarify the Governor’s executive order and set a path for determining COVID-19 occupational injuries beyond July 2020.

SB 1159 was passed by the Senate Committee on Labor, Public Employment and Retirement on May 14, 2020 and referred to the Senate Appropriations Committee.It will have to be passed by Appropriations by June 19th and then passed by the full Senate by June 26th to be considered by the Assembly this year.

AB 196—This was previously a paid family leave bill which was gutted and amended on May 5, 2020 to establish a conclusive presumption for COVID-19 for any injury occurring on or after March 1, 2020 and for 90 days after termination of service. A conclusive presumption would preclude an employer from producing evidence showing that an employee’s illness or injury was not incurred in the course of their employment. Moreover, considering the comparatively short average incubation period for COVID-19, the fact that the presumption would apply for up to 90 days following termination of service raises a concern that many community incurred cases of COVID-19 could be swept into this bill’s presumption.

AB 664—Probably the broadest of the presumption bills is AB 664, which would trigger a conclusive presumption for peace officers, fire fighters and health care employees providing direct patient care in an acute care hospital. An employer would have no opportunity or means of rebutting the presumption that those classes of employees suffered an injury or illness in the course of and as a result of a workplace exposure.

For those persons, AB 664 would also expansively define the term “injury” to include the direction to enter into quarantine by a licensed health care professional, a public health agency or an employer as a result of the exposure to or contraction of a communicable disease, including COVID-19 occurring on or after January 1, 2020 and that is the subject of a state or local declaration of a state of emergency.

This definition of “injury” is important in two respects: it applies to communicable diseases other than COVID-19, and it defines “injury” in such a way that a person would not have to be diagnosed with a disease to be eligible for workers’ compensation—an employee would just have to be directed to self-quarantine.

AB 664 would also direct workers’ compensation benefits to cover not only medical care, but the “reasonable costs of reimbursement” for emergency equipment or personal protective equipment (PPE) for the worker, living expenses that exceed the living expenses usually incurred by the person, and temporary housing costs under certain circumstances.

As presently written, AB 664 is an urgency statute which would require a 2/3 vote of the Legislature to go to the Governor. Its provisions have raised significant concerns among employers.

Because of the pandemic and the resultant legislative hiatus, previously set calendar deadlines for the Legislature have been recently updated. The deadline for bills to be heard in policy committees in their house of origin has been pushed to May 29, 2020. The Assembly has set a May 29th deadline for bills to pass out of the Appropriations Committee; in the Senate, this deadline is June 19th. The Assembly's deadline for bills to be passed out of the house of origin is June 19th, while the Senate's will be June 26th. As these bills proceed through committees, we will continue to keep employers informed.

While SB 1159 seems to be the bill most likely to proceed to passage this year, all of these bills are still active. As with much else enacted in response to the COVID-19 pandemic, the ultimate resolution of the question of how to handle workers impacted by COVID-19 is still very much an open question. In the interim, the Governor’s Executive Order N-62-20 continues to be the only operative COVID-19 presumption for California workers.

About Amy Donovan
Amy is Keenan's Vice President of Legislative and Regulatory Affairs, authoring the firm's Briefings and position papers on legislation, regulation and litigation that have an impact on the firm and its clients.