Governor Newsom Signs SB 1159 and AB 685 Into Law Impacting COVID-19 Related Workers’ Compensation Coverage and Creating New Notice and Reporting Requirements Related to COVID-19 Workplace Exposures

Category: Special Bulletins
Date: Sep 17, 2020 06:15 PM

On September 17, 2020, Governor Gavin Newsom signed into law two COVID-19 related bills – Senate Bill (“SB”) 1159 and Assembly Bill (“AB”) 685.  SB 1159 is an urgency bill that is now effective immediately, and sets forth rebuttable presumption standards to establish workers’ compensation coverage for employees who contract COVID-19.  AB 685 modifies occupational safety standards to require employers to provide notice and report information related to COVID-19 exposures, and provides the California Division of Occupational Safety and Health (“Cal/OSHA”) expanded authority to enforce such requirements and ensure safe workplace operations.  AB 685 is effective January 1, 2021. 

Below is a summary of both bills and their impact on employers.

SB 1159

SB 1159 amends existing workers’ compensation laws to address the impact of employees who contract COVID-19 and the extent that such illness is considered industrial, and therefore entitles the employee to workers’ compensation benefits.

A.  Standards for Application of Workers’ Compensation Rebuttable Presumption for an Employee’s COVID-19 Illness

Employees injured in the course and scope of employment are generally entitled to receive workers’ compensation benefits for their injuries.  Existing law establishes a series of specific injuries and illnesses for certain public safety employees that are presumed to be industrial in nature and create a rebuttable presumption that will qualify them for workers’ compensation benefits immediately, unless an employer can provide sufficient information to indicate that the injury or illness is non-industrial.  

Recognizing the unique challenges posed by the COVID-19 global pandemic, SB 1159 now creates a similar presumption for illness or death resulting from COVID-19 in the following three circumstances:

  1. The bill codifies Executive Order N-62-20, issued by Governor Newsom on May 6, 2020, which expanded the workers’ compensation rebuttable presumption to ANY employee who reported to their place of employment between March 19 and July 5, 2020, and who tested positive for or was diagnosed with COVID-19 within the following 14 days during that time period.
  2. This rebuttable presumption is then extended beyond July 6, 2020, for firefighters, peace officers, fire and rescue coordinators, and certain kinds of health care and health facility workers, including in-home supportive services providers that provide services outside their own home.  For health facility employees other than those who provide direct patient care, and other than custodial employees in contact with COVID-19 patients, the presumption does not apply if the employer can show the employee did not have contact with a COVID-19 positive patient within the 14-day period.
  3. For all other employees, the rebuttable presumption is only applied if the employee works for an employer with five or more employees and the employee tests positive for COVID-19 within 14 days after reporting to their place of employment during a COVID-19 “outbreak” at the employee’s specific work place. For purposes of this presumption, a COVID-19 “outbreak” exists if within 14 calendar days one of the following occurs at a “specific place of employment” (which excludes the employee’s home):
  • If the employer has 100 employees or fewer at a specific place of employment, 4 employees test positive for COVID-19;
  • If the employer has more than 100 employees at a specific place of employment, 4% of the number of employees who reported to the specific place of employment, test positive for COVID; or
  • 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

For purposes of administering this “outbreak” presumption, SB 1159 requires employers to report to their workers’ compensation claims administrator in writing within three business days when they know or reasonably should know that an employee has tested positive for COVID-19, along with other relevant information.

The Workers’ Compensation Appeals Board (“WCAB”) is bound by these presumptions unless presented with controverted evidence to dispute the presumption.  Workers’ compensation awarded for covered COVID-19 related illness or death includes full hospital, surgical, medical treatment, disability indemnity, and death benefits. The bill also makes a workers’ compensation claim relating to a COVID-19 illness presumptively compensable, as described above, after only 30 days, rather than the standard 90-day time period for all other types of workers’ compensation claims.

B.  Application of Other COVID-19 Paid Benefits and Duration of New Law

However, SB 1159 requires an employee to exhaust any COVID-19 related supplemental paid sick leave benefits (e.g., FFCRA’s Emergency Paid Sick Leave or California’s supplemental paid sick leave under AB 1867) and meet certain certification requirements before receiving temporary disability benefits or an industrial injury leave of absence.

In addition, the effective timeframe for workers’ compensation benefits under SB 1159 based on illness or death due to COVID-19 is limited, as the law will remain in effect only until January 1, 2023, after which the law will sunset and be repealed unless extended further by the Legislature.

SB 1159 also requires the Commission on Health and Safety and Workers’ Compensation to conduct a study of the impact of COVID-19 on the workers’ compensation system, to deliver a preliminary report to the Legislature and Governor by December 31, 2021, and to deliver a final report to the legislature by April 30, 2022.

C.  Impact of SB 1159 on Employers

As SB 1159 is now law, employers need to be vigilant and prepared to respond to any indication that an employee has contracted COVID-19 and should coordinate with their workers’ compensation insurance carriers and claims adjusters to establish best practices for reporting and responding to potential workers’ compensation claims based on COVID-19.

(SB 1159 adds Sections 77.8, 3212.86, 3212.87, and 3212.88 to the Labor Code.)

AB 685

In response to the COVID-19 pandemic and its impact on maintaining a safe workplace, AB 685 amends the Labor Code in several areas to require employers to adhere to stricter occupational health and safety rules and empowers Cal/OSHA with expanded enforcement powers to address such standards as follows – effective January 1, 2021:

A.  New COVID-19 Employer Notice and Reporting Requirements

AB 685 requires employers to comply with certain reporting requirements and provide the following four notices related to potential COVID-19 exposures in the workplace within one business day of being informed of the potential exposure:

  1. Potential COVID-19 Exposure Notice to Employees

If an employer or the employer’s representative receives a notice of a potential exposure to COVID-19 in the workplace by a “qualifying individual”, the employer must provide a written notice to all employees, and to the employers of subcontracted employees, who were present at the same worksite within the infectious period (as defined by the State Department of Public Health), stating that they may have been exposed to COVID-19.

For purposes of this requirement, a “qualifying individual” means a person who can establish any of the following requirements:

  • A laboratory-confirmed case of COVID-19;
  • A positive COVID-19 diagnosis from a licensed health care provider;
  • A COVID-19 related isolation order issued by a public health official; or
  • Death due to COVID-19 as determined by the County public health department. 

The notice must be sent in a manner the employer normally uses to communicate employment-related information.  This can include personal service, email, or text message so long as it can be reasonably anticipated that employees will receive the notice within the one business day requirement.  The notice must be in both English and the language understood by the majority of employees.

2.  Potential COVID-19 Exposure Notice to Exclusive Representative of Represented Employees

If the affected employees who are required to receive this COVID-19 exposure notice include represented employees, the employer must send the same notice to the exclusive representative of the affected bargaining unit.

3.  Notice of COVID-19 Related Benefits and Employee Protections

An employer must also provide all affected employees and the exclusive representative, if any, with a notice of information regarding any COVID-19-related benefits or leave rights under federal, state, and local laws, or pursuant to employer policy, as well as the employee’s protections against retaliation and discrimination.

4.  Notice of Safety Plan in Response to Potential COVID-19 Exposure

Finally, the employer must notify all employees, the employers of subcontracted employees, and any exclusive representative, of the employer’s plans for implementing and completing a disinfection and safety plan pursuant to guidelines issued by the federal Centers for Disease Control.

Failure to comply with these requirements may subject the employer to a civil penalty. AB 685 also prohibits employers from requiring employees to disclose medical information except as required by law, and prohibits employers from retaliating against an employee for disclosing a qualifying case of COVID-19.  Employers are also required to maintain records of these four notices for at least three years.

Where employers are notified of a number of cases that meet the definition of a COVID-19 “outbreak” as defined by the California Department of Public Health (“CDPH”), the employer must also notify the applicable local public health agency within 48 hours of the names, number, occupation, and worksite of any “qualifying individuals” related to the “outbreak”.  

An “outbreak” is currently defined by CDPH as “three or more laboratory-confirmed cases of COVID-19 within a two-week period among employees who live in different households.” (See CDPH’s “COVID-19 Employer Playbook – Supporting a Safer Environment for Workers and Customers – available online at https://files.covid19.ca.gov/pdf/employer-playbook-for-safe-reopening--en.pdf)

CDPH is also required to make workplace statistics received from local health departments under this provision – other than personally identifiable employee information – available on its website, such that members of the public can track the number of cases and outbreaks by industry.

These new COVID-19 notice and reporting requirements apply to all private and public employees, with two exceptions:

  • Health facilities, as defined in Section 1250 of the Health and Safety Code, are exempt from reporting an “outbreak” within 48 hours as described above;
  • The notice requirements do not apply to exposures by employees whose regular duties include COVID-19 testing or screening or who provide patient care to individuals who are known or suspected to have COVID-19, unless the “qualifying individual” is also an employee at the same worksite.

B.  Cal/OSHA Will Be Authorized to Shut Down A Workplace, Operation, or Process that Creates an Imminent Hazard Due To COVID-19 Exposure Risk.

Under current law, whenever Cal/OSHA finds that a place of employment or specific equipment in the workplace creates an imminent hazard to employees, Cal/OSHA has the authority to prohibit entry into the affected part of the workplace or to prohibit the use of the dangerous equipment in the workplace.

AB 685 expands and clarifies Cal/OSHA’s authority within the context of COVID-19 related issues in the workplace. Under AB 685, if Cal/OSHA finds that a workplace or operation/process within a workplace exposes employees to a risk of COVID-19 infection and thereby creates an imminent hazard to employees, Cal/OSHA now has authority to prohibit entry to the workplace or to the performance of such operation/process.  If Cal/OSHA uses its authority to apply such a workplace restriction, it must then provide the employer with notice of the action and post that notice in a conspicuous place at the worksite.  Any restrictions imposed by Cal/OSHA must be limited to the immediate area where the imminent hazard exists and must not prohibit any entry into or operation/process within a workplace that does not cause a risk of infection. In addition, Cal/OSHA may not impose restrictions that would materially interrupt “critical government functions” essential to ensuring public health and safety functions, or the delivery of electrical power or water.

This expanded authority sunsets on January 1, 2023, and will be repealed automatically on that date unless further extended by the Legislature.

C.  Amends Cal/OSHA Procedures for Serious Violation Citations Relating to COVID-19

Currently, before Cal/OSHA can issue a citation to an employer alleging a “serious violation” of occupational safety and health statutes or regulations, it must make a reasonable attempt to determine and consider whether certain mitigating factors were taken by an employer to rebut the potential citation.  Cal/OSHA satisfies this requirement by sending an employer a description of the alleged violation at least 15 days before issuing a citation, and provides the employer an opportunity to respond.  Even if an employer does not provide information in response to Cal/OSHA’s inquiries, an employer is still not precluded from presenting such information at a later hearing to contest the citation.  

AB 685 modifies this procedure until January 1, 2023 as applied to serious violation citations Cal/OSHA issues related to COVID-19.  For such COVID-19 serious violation citations, Cal/OSHA is not obligated to provide an alleged violation at least 15 days prior to issuing the citation to allow an employer the opportunity to respond and can instead issue the citation immediately.  The employer would still be able to contest the citation through the existing Cal/OSHA appeal procedures.

D.  Impact of AB 685 on Employers

Because AB 685 is not effective until January 1, 2021, employers have some time to prepare for its new notice and reporting requirements.  Employers should review and revise their existing procedures related to notification of COVID-19 exposures in the workplace in order to ensure they are ready to comply with the new notice and reporting requirements imposed by AB 685 once it becomes effective.

(AB 685 amends Sections 6325 and 6432 of and adds Sections 6325 and 6409.6 to the Labor Code.)

If you have questions about SB 1159 and AB 685 and how they may affect your agency’s operations, LCW attorneys are available to answer your questions.

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