Updated:  California Expands Workers’ Compensation in Response to COVID-19 Pandemic

May 20, 2020
May 20, 2020 Update.  The California Department of Industrial Relations issued guidance related to the implementation of the Executive Order in the form of Questions and Answers. This new guidance has been incorporated into this updated post.
 
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On May 6, 2020, California Governor Gavin Newsom signed an Executive Order expanding workers’ compensation for employees who report to the workplace in-person at the instruction of their employer on or after March 19, 2020. The Order creates a rebuttable presumption that an employee’s COVID-19-related illness arose out of and in the course of employment if, after March 19, 2020, the employee tested positive for or was diagnosed with COVID-19 within 14 days after a day that the employee performed, at the employer’s direction, labor or services at the place of employment. The presumption applies regardless of whether the employee was working in “essential” industries or providing “essential” services. The diagnosis must be made by a physician who holds a physician and surgeon license issued by the California Medical Board and must be confirmed by a viral or antibody test within 30 days of the date of the diagnosis. If the employee tested positive or was diagnosed with a COVID-19-related-illness before the Executive Order was issued on May 6, 2020, the employee must get documentation or a statement from his or her physician by May 21 setting forth the period that the employee was temporarily disabled and unable to work. The presumption is in effect for 60 days, until July 5, 2020. 
 
Employers are permitted to present evidence to rebut the presumption, however if liability for a claim of COVID-19-related illness is not rejected within 30 days of its filing, the illness is presumed compensable “unless rebutted by evidence only discovered subsequent to the 30-day period.” If an employee’s COVID-19-related claim is accepted, the employee is “eligible for all benefits applicable” under California workers’ compensation laws including full hospital, surgical and medical treatment, disability indemnity and death benefits.
 
An employee with paid sick leave benefits specifically available in response to COVID-19 must exhaust those benefits before any temporary disability benefits or other applicable statutory benefits are due and payable. If an employee does not have such sick leave benefits, temporary disability benefits or other applicable statutory benefits must be provided from the date of disability. If an employee who does not have paid sick leave benefits available specifically in response to COVID-19 took paid leave through an employer’s plan, that leave should be restored to the employee.
 
The Executive Order does not apply to COVID-19-related claims, regardless of the date of injury, that were accepted by the claims administrator as compensable prior to May 6. Those claims should be handled in the same manner as other accepted claims would be absent the Executive Order. For COVID-19-related workers’ compensation claims that were denied prior to the issuance of the Executive Order, the employer may reconsider and accept the claim based upon the Order or stand by the denial. If an employer does not reverse its decision and an individual believes that he or she is entitled to benefits under this Executive Order, he or she may file for a hearing at the closest Division of Workers’ Compensation office. 
 
If the presumption does not apply, an individual who is an employee and suffers a job-related injury or illness is still entitled to file for workers’ compensation benefits, and may still be eligible to receive workers’ compensation benefits if he or she contracted COVID-19 at work.
 
A similar bill is currently under consideration in New York but has not yet passed.
 
As the COVID-19 situation continues to develop, and federal, state, and local governments issue additional guidance, employers need to be cognizant of new guidance and requirements.  For more information, please visit S&C’s page regarding Coronavirus updates.