California Governor Newsom Passes New Legislation Concerning Employees Who Contract COVID-19 While Working

By Swerdlow Florence Sanchez Swerdlow & Wimmer

October 12, 2020

California Governor Gavin Newsom signed two significant pieces of legislation involving California workers impacted by COVID-19: Senate Bill 1159 ("SB 1159") and Assembly Bill 685 ("AB 685"). SB 1159, which takes effect immediately, provides for a workers’ compensation presumption for employees who contract COVID-19 and requires certain notification of COVID-19 cases to workers’ compensation claims administrators. AB 685, which takes effect on January 1, 2021, requires employers to notify employees when there is a COVID-19 case at work.

This alert will summarize this new legislation and discuss their implications for employers.

SB 1159 – Workers’ Compensation Presumption

SB 1159, which is effective immediately, adds various provisions to the California Labor Code concerning COVID-19-related illnesses in the workplace. First, the newly-added Labor Section 3212.86 ("Section 3212.86") provides that employees who tested positive or were diagnosed with COVID-19 within 14 days of being at the employee’s place of employment at the employer’s direction between March 19, 2020 and July 5, 2020 are presumed to have contracted COVID-19 at work. This codifies Governor Newsom’s Executive Order N-62-20, which expired on July 5, 2020. This presumption is disputable and may be controverted by other evidence. Unless controverted, however, the workers’ compensation appeals board must find in accordance with the presumption.

Second, SB 1159 adds Section 3212.87 ("Section 3212.87") to the Labor Code, which creates a rebuttable presumption of eligibility for workers’ compensation benefits for certain categories of employees who get sick or injured due to COVID-19 on or after July 6, 2020. Section 3212.87 applies to: employees who provide direct patient care or custodial employees in contact with COVID-19 patients who work for designated health facilities; registered nurses and EMTs; employees who provide direct patient care for a home health agency; active firefighting members of specified fire departments or units; certain peace officers; fire and rescue services coordinators who work for the Office of Emergency Services; certain providers of in-home supportive services; and other employees of designated health facilities in certain circumstances. An injury under this section is defined to include illness or death resulting from COVD-19 if the employee tested positive for COVID-19 within 14 days of having worked at the employee’s place of employment at the employer’s direction on or after July 6, 2020. An injury under this Section is presumed to arise out of the course of employment; however, this presumption is also disputable. This presumption is extended following "termination of service" for a period of 14 days, commencing with the last day actually worked. Like Section 3212.86, this Section shall also be repealed on January 1, 2023.

Additionally, SB 1159 adds Section 3212.88 ("Section 3212.88") to the Labor Code, which creates a rebuttable presumption of eligibility for workers’ compensation benefits for employees NOT described in Section 3212.87 when the following conditions are met: (1) the employee tests positive for COVID-19 within 14 days after a day that the employee performed labor or services at the employee’s place of employment at the employer’s direction; (2) the employee works for an employer with five or more employees; (3) the day the employee performed labor or services at the employee’s place of employment was on or after July 6, 2020; and (4) the employee’s positive test occurred during a period of "outbreak" at the employee’s specific place of employment. An "outbreak" exists if, within 14 calendar days, one of the following occurs at a specific place of employment:

•    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 percent of the number of employees who reported to the specific place of employment test positive for COVID-19; or
•    A specific place of employment is ordered to close by a local public health department, the California Department of Public Health, the Division of Occupational Safety and Health, or a school superintendent due to a risk of infection with COVID-19.

Importantly, under this Section, evidence relevant to controverting the presumption includes evidence of measures in place to reduce the potential transmission of COVID-19 in the workplace and an employee’s evidence of nonoccupational risks of COVID-19 infection. This presumption also is extended for a period of 14 days following "termination of service" commencing on the last day actually worked. This Section specifies that it in no way affects an employee’s rights to compensation for any injury or illness involving a "preponderance of evidence."

SB 1159 – Reporting Requirements To Workers’ Compensation Claims Administrators

Section 3212.88 also requires that an employer who knows or reasonably should have known that an employee has tested positive for COVID-19 report the following information to its workers’ compensation claims administrator in writing via email or fax within 3 business days:

1.    An employee has tested positive for COVID-19 (this report should not include any personally identifiable information regarding the employees unless the employee asserts the infection is work-related or has filed a claim);
2.    The date the employee tested positive (the date the specimen was collected);
3.    The specific address of the employee’s place of employment during the 14 days prior to the positive test; and
4.    The highest number of employees who reported to work in the 45-day period preceding the last day the employee reported to work.

Significantly, if the employer was aware of positive cases between July 6, 2020, and September 17, 2020 (the enactment of SB 1159), the employer must notify its claim administrator of the information above by October 29, 2020. Instead of the fourth data point listed above, the employer shall instead report the highest number of employees who reported to work at each of the employee’s specific places of employment on any given work day between July 6, 2020, and September 17, 2020.

This information will be used by claims administrators to determine if an outbreak has occurred for the purposes of administering a claim under Section 3212.88.

Employers who fail to report required information, or who intentionally submit false or misleading information, are subject to a civil penalty of up to $10,000.

Section 3212.88 also automatically repeals on January 1, 2023.

AB 685 – COVID-19 Notifications To Employees

AB 685, which takes effect January 1, 2021 to January 1, 2023, specifically requires employers to provide notification to employees when a "qualified individual" (someone who tested positive for or was diagnosed with COVID-19, or was subject to an isolation order) is in an employer’s worksite during their infectious period. AB 685 adds Section 6409.6 to the Labor Code ("Section 6409.6"), which requires employers who receive notice of a potential exposure to COVID-19 in the worksite, due to a qualified individual, to take the following actions within one business day of the employer receiving notice of potential exposure:

1.    Provide written notice to all employees may have been exposed to COVID-19 due to working at the same worksite within the infectious period of the qualified individual. This includes notifying the employers of subcontracted employees;
2.    Provide written notice to the exclusive representative, if any, of the employees who may have been exposed;
3.    Provide all employees who may have been exposed (and the exclusive representative, if any) with information regarding COVID-19-related benefits to which the employee may be entitled, including workers’ compensation benefits, COVID-19-related leave, company sick leave, state-mandated leave, supplemental sick leave, any negotiated leave provisions, as well as anti-retaliation and anti-discrimination protections of the employee; and
4.    Notify all employees who may have been exposed, including the employers of subcontracted employees and the exclusive representative, if any, on the safety and disinfection plan that the employer plans to implement and complete per the guidelines of the CDC.

The notification only applies to employees who may have been exposed, and defines "worksite" to mean the building, store, facility, agricultural field, or other location where an employee worked during the infectious period. It does not apply to buildings, floors, or other locations of the employer that a qualified individual did not enter. In a multi-worksite environment, the employer need only notify employees who were at the same worksite as the qualified individual.

This Section also requires an employer to notify the local public health agency within 48 hours of becoming aware of an "outbreak" of COVID-19 in the workplace. The California Department of Public Health currently defines an outbreak as three or more laboratory-confirmed cases of COVID-19 within a two-week period among employees who live in different households. If such an outbreak occurs, the employer must provide the local public health department with the name, number, occupation and worksite of employees diagnosed with COVID-19 or asked to isolate due to COVID-19.  This obligation to report continues regarding any subsequent, laboratory-confirmed cases of COVID-19 at the worksite.

Importantly, Section 6409.6 states that employers must not require employees to disclose medical information unless otherwise required by law and that an employer cannot retaliate against a worker for disclosing a diagnosis of COVID-19 or positive test in order to quarantine or isolate. This Section also authorizes employees who believe they have been retaliated to file a complaint with the DLSE.

There are significant exceptions to these notification requirements. Although Section 6409.5 applies to private and public employers, the obligation to report "outbreaks" to local public health agencies does not apply to "health facilities." Additionally, the requirement to report cases to employees and "outbreaks" to local public health agencies in Section 6409.6 does not apply to employees who, as part of their duties, conduct COVID-19 testing or provide direct patient care to individuals with COVID-19, or are in quarantine or isolation related to COVID-19 (unless the qualifying individual is an employee at the same worksite).

Employers must maintain records of the required written notifications for a period of at least 3 years.

Additionally, AB 685 amends Section 6325 of the Labor Code to add, among other things, that when an employer exposes workers to the risk of a COVID-19 infection so as to constitute an imminent hazard to employees, an employer’s operations can be shut down by Cal/OSHA, and a notice thereof would then be posted in a conspicuous place. This shutdown is limited to the immediate area where the imminent hazard exists, and no other prohibition of work in the workplace is otherwise permitted. This Section, regarding COVID-19, automatically repeals on January 1, 2023.

Finally, AB 685 amends and adds provisions to the Labor Code regarding "serious violations" for Cal/OSHA citations, and adds that there is a rebuttable presumption of a serious violation in a place of employment if there is a "realistic possibility that death or serious physical harm could result from the actual hazard created by the violation." This Section also automatically repeals on January 1, 2023.

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This new legislation is significant for employers in that it creates heightened workers’ compensation liability for employees working on site who contract COVID-19. It also obligates employers to notify employees of coworkers who have potentially been exposed to COVID-19, as well as local health authorities of any outbreaks in the workplace.