Hinshaw's 12 Days of California Labor & Employment Series – Day 1: COVID-19 and the Rebuttable Workers' Compensation Presumption

Can you believe this year is nearly over? Before popping the champagne, it's time to reprise our annual review of key labor and employment law developments in California. While California employers are thrown curve balls every year, the events of 2020 are simply unrivaled in living memory. Employers have been in a constant state of change all year, as they have been operating at the mercy of COVID-19 case numbers, stay at home orders, capacity limitations, and so much more. In the spirit of the season—and some semblance of normal—here is the first of our annual "12 days of the holidays" blog series. On this first day of the holidays, my labor and employment attorney gave to me: a partridge in a pear tree and SB 1159.

With the latest shut downs occurring in various parts of the state, it seems appropriate to kick-off the 2020 series with SB 1159. The bill provides a rebuttable presumption in certain instances when an employee contracts COVID-19. Effective immediately upon being signed on September 17, 2020, SB 1159 expires January 1, 2023.

Earlier this year, Governor Newsom signed Executive Order N-62-20, which provided a rebuttable presumption. The Order—which expired July 6, 2020—stated that "all California employees who work at a jobsite outside their home at the direction of their employer between March 19, 2020 and July 5, 2020 and who test positive for COVID-19 within 14 days of working at their jobsite are presumed to have contracted any COVID-19-related illness at work for the purposes of awarding workers' compensation benefits."

In essence, the enactment of SB 1159 codifies the expired Executive Order N-62-20 (with some alterations). First, SB 1159 applies to employers with five or more employees. However, it does not apply to every COVID-19 case that occurs in the workplace. Instead,  the rebuttable presumption exists when an employee tests positive for COVID-19 within 14 days of performing work at the place of employment at the employer's direction; and performed this work between July 6, 2020 and January 1, 2023; and tested positive during a an outbreak at the employee's specific place of employment.

To qualify for the presumption, an employee must have worked at the direction of an employer on-site at the employer's premises. It does not cover an employee working from home. There is also the requirement that the positive test occurred during an outbreak. An outbreak exists if, within 14 days, one of the following events occurs:

• If the employer has 100 or less employees, and there are at least four employees who test positive for COVID-19; or
• If the employer has more than 100 employees at a specific place of employment, there needs to be 4% of the workforce at that specific location that test positive for COVID-19; or
• If a specific place of employment is ordered closed because of COVID-19.

According to SB 1159, a specific place of employment is defined as "the building, store, facility, or agricultural field where an employee performs work at the employer's direction." As such, employers need to keep track of where their employees are located, especially if they are in different areas. And, if the employer has multiple locations, they must also monitor if an employee travels between the different facilities.

If the necessary factors are met, generally, an employer has 45 days to dispute the presumption. An employer can only use evidence discovered subsequent to the applicable investigation period. However, note that for any cases involving essential workers, an employer only has 30 days to dispute the presumption.

Lastly, SB 1159 also created new reporting requirements for employers. When an employer knows—or, reasonably should know—an employee has tested positive for COVID-19, the employer must report this to their claims administrator in writing, via e-mail or fax, within three business days. Without giving any identifiable information, the employer must provide that an employee tested positive, along with the date of the positive test, the address where the employee worked and the highest number of employees who reported to work at that specific location in the 45 days preceding the last day the employee worked at that particular location(s).

It is recommended that employers mandate and maintain accurate record keeping concerning which employees are working on-site, on what date, and at what location. An employer should immediately assess whether there was/is an outbreak. If there is no outbreak, there is no presumption. Finally, when there is a positive COVID-19 case, an employer should immediately assess whether they question the injury arising out of or in the course of employment, as they will only have 30 or 45 days to dispute the presumption, depending on the type of employee.

While a vaccine is on the horizon, it is still recommended that employers create and maintain a COVID-19 safety plan to ensure the safety of their employees. One final note for employers: there is a $10,000 penalty for an employer who intentionally submits false or misleading information, or fails to submit information.