Californians who contract COVID-19 at work get additional help under new law

California will relax the burden of proof to receive workers' compensation benefits for some employees who contract COVID-19 on the job under a bill Gov. Gavin Newsom signed Thursday.

Senate Bill 1159 by Sen. Jerry Hill (D-San Mateo) makes it easier for police, firefighters and other essential employees who contract COVID-19 while working to be covered under the state’s workers’ compensation program. In other workplaces — both public and private — the new law presumes employees caught the novel coronavirus on the job if there is an outbreak at their worksite, ensuring those employees are eligible to have their medical bills and lost wages covered.

Because lawmakers passed the law as an urgency bill, it will go into effect immediately, bypassing the typical Jan. 1 start date for most laws.

Newsom said during a bill signing ceremony streamed online that the new law makes clear the need to "prioritize our workforce, our workers, our frontline essential workforce that we pay a lot of lip service to but, often, we don't back up."

Newsom's signature Thursday didn't come as a surprise. The governor said earlier this year that he planned to work “hand in glove” with the Legislature to expand COVID-19 workplace protections, including loosening workers’ compensation claim requirements.

Newsom signed an executive order in May easing workers’ comp restrictions for all employees required to work outside the home, but those changes expired on July 5. SB 1159 is retroactive to July 6 and expires in 2023.

"This helps employees who are struggling after becoming a victim of COVID-19," Hill said.

California's workers' compensation system pays employees who have suffered an injury or illness on the job, regardless of who is at fault. For most workers, the onus is on them to prove the injury or illness was work related. However, certain occupational injuries and maladies experienced by law enforcement officers, firefighters and correctional officers, such as heart disease, hernias, pneumonia, cancer and meningitis, are presumed to have occurred during the course of their employment, requiring the workers' compensation system to pay for treatment and, in fatal cases, death benefits.

The state's 100-year-old workers' compensation insurance system relies on nearly 700,000 businesses covered by 200 insurance companies to pay for medical care and wage replacement when employees are injured while working. Some 800,000 workers receive benefits from the program each year, according to a 2020 report from the Workers’ Compensation Insurance Rating Bureau of California.

There have been more than 40,436 claims filed so far this year by workers who said they contracted COVID-19 on the job, according to statistics from the Department of Industrial Relations, which oversees the workers' compensation system. Of those, 11,186 have been rejected, with most denials attributed to a negative COVID-19 test. The number of workers' compensation claims for the coronavirus jumped from 4,790 in May to 11,271 in June and to 12,889 in July, according to the Department of Industrial Relations.

The workers' comp rating bureau estimated that COVID-19 claims will cost employers and insurers around $2 billion. The bureau estimated in May that the average claim paid would be $29,000.

Under the law Newsom signed, employees will be presumed to have contracted COVID-19 on the job if there was an outbreak where they worked. The law defines an outbreak as when five or more employees contract the virus within a 14-day period at a workplace with five to 100 employees or when 5% of employees contracti the virus in that period at a worksite with more than 100 employees.

In those cases, an employer could still challenge a claim on the grounds that the employee had been exposed elsewhere, but opponents of the bill argued that is a difficult burden to prove.

"I think the threshold is critical," Hill said. "Really, it's common sense. You shouldn't be able to have an outbreak of the extent we've seen in some workplaces and conclude those workers didn't get it from the workplace."

During the final weeks of the legislative session that concluded Aug. 31, the bill underwent six amendments in an attempt to reach consensus among labor and business groups. The Workers' Compensation Action Network, a statewide coalition representing employers and insurers, said those late changes made the law more palatable, even if the group remained opposed to the legislation.

Under the new law, the Commission on Health and Safety and Workers' Compensation will be required to conduct a study on the impact of COVID-19 on the workers' compensation system by April 30, 2022.

“In the end, employers are satisfied that lawmakers rejected more extreme proposals, which would have imposed broad new liability on struggling California employers to pay for COVID-19 cases that are unrelated to work," the group said in a statement. "Such proposals risked turning the workers’ compensation system into a broad social safety net for the pandemic, a responsibility that should be reserved for government, not California employers grappling with an economic crisis."

Newsom also signed Assembly Bill 685 by Assemblywoman Eloise Gomez Reyes (D-Grand Terrace), which will require employers to provide written notice to workers who may have been exposed to the virus and to inform local public health officials. The legislation also gives state regulators new authority over the next two years to penalize business owners if workplace violations are discovered.

Julie Su, the secretary of California's Labor and Workforce Development Agency, said the notification law extends beyond those who are directly employed by a business owner to include subcontractors, "so that workers can choose to stay home, to get tested, to protect themselves and their families and to follow other health guidelines about quarantining."

Times staff writer John Myers contributed to this report