On September 17, 2020, Gov. Newsom signed into law Senate Bill 1159

The bill modifies an existing statute defining “injury” for an employee to now include illness or death resulting from coronavirus. This provision will remain in effect until January 1, 2023 (unless extended by the legislature).

The bill also creates two major stipulations regarding COVID-19 and workers’ compensation insurance.

  1. California employers are now required to report to their worker’s compensation insurer any staff that test positive for COVID-19, whether work-related or not, within three business days of finding out such information.
     
  2. Employees who test positive for COVID-19 can file a workers’ compensation claim if certain criteria are met. 
     

SB 1159 impact on employers: 

The requirement to report cases among staff, despite being made in the name of safety, pose challenges contractors will have to navigate. One of the biggest challenges contractors face is the requirement to report information to their workers’ compensation insurer everytime there’s a positive COVID-19 test.  

“Employers, irrespective of whether there is a claim filed, have to report this information every time there is a positive COVID test,” said Michael Sullivan, El Segundo, California-based general managing partner of Michael Sullivan & Associates LLC. “They have to include how many employees are present at every (work site). It creates an incredible burden for employers.” 

When employers report COVID-19 cases to their workers’ compensation carrier, the following information must be included:

  1. The date an employee tested positive for COVID-19.
     
  2. The specific address of addresses of the employee’s place or places of employment during the 14-day period preceding the positive test.
     
  3. How many employees are present at every work site.
     
  4. The highest number of employees who reported to work within the 45 days preceding the last day the employee worked in the workplace. 

The requirement to report how many employees are present at every works site is another significant challenge contractors will have to tackle, as it requires that information get documented regularly. This can lead to a daunting amount of paperwork.

Additionally, if an employer is discovered to have known, or “reasonably should have known” about a positive test and failed to report it to their workers’ compensation employer within three business days, the employer will be slapped with a hefty $10,000 fine for each and every incident. The fine will be assessed by the Cal-OSHA Labor Commissioner. 

This makes it imperative, despite the burden, that contractors stay vigilant and on top of reporting as the fines could quickly put their business out of business. 

SB 1159 impact on employees: 

As stated above, employees who test positive for COVID-19 can file a workers’ compensation claim if the below-listed criteria are met on all fronts:

  1. The employee tests positive for COVID-19 within 14 days after the employee performed labor or services at said employee’s place of employment, at their employer’s direction.
     
  2. The day on which the employee performed said work at their employer’s direction occurred on or after July 6, 2020.
     
  3. The employee’s positive test occurred during an outbreak* at their place of employment.

Following all criteria being met, the infected employee is eligible for compensation on all COVID-19 related costs for full hospital visits, surgical procedures, medical treatment, disability indemnity and death benefits. However, if an employee has paid employer-offered sick leave benefits, specifically available in response to COVID-19, those benefits must be used and exhausted before any temporary disability benefits can be claimed. 

If you have questions regarding your workers’ compensation plan with regards to COVID-19, CCIS recommends that you contact your plan administrator/insurance agent. 

*A place of employment is considered to have an outbreak if one of the following occurs: The employer has 100 employees or fewer at a specific place of employment and at least 4 employees test positive for COVID-19. The employer has more than 100 employees at a specific location and at least 4% of employees test positive for COVID-19. The place of employment is ordered to close by its local public health department.**

**Check with your local county health officer for reopening guidelines.