California Expands Workers’ Compensation through New Executive Order

Yesterday, California Governor Gavin Newsom issued Executive Order (EO) N-62-20. The Order significantly expands current workers’ compensation policy in response to the COVID-19 pandemic. It includes a slew of provisions that will likely lead to a surge in workers’ compensation claims, raising costs for employers, insurers, and the state.

Under this EO, it will be presumed that any employee who is infected with COVID-19 contracted the virus at the workplace and is eligible for workers’ compensation so long as the following criteria are met:

• The employee tested positive or was diagnosed with COVID-19 within 14 days of being at the workplace as required by the employer.
• The day in which work was performed at the workplace was on or after March 19, 2020
• The workplace is not the employee’s home.
• A physician licensed by the California Medical Board issued the COVID-19 diagnosis and within 30 days of the diagnosis administered a COVID-19 test.

The EO does include a few elements that may ameliorate some of the damage. First, employers will at least have the opportunity to dispute the workers’ compensation claim. Second, the presumption only covers claims made from March 19, 2020 to 60 days from the date the EO was issued. Finally, in a letter to Governor Newsom, the Chamber asked for the paid leave expansions provided by the Federal Government in the Families First Coronavirus Response Act (FFCRA) or by state law to be used and exhausted before awarding workers’ compensation, and this requirement was included.

Through the CARES Act and FFCRA, multiple programs were either created, such as pandemic unemployment assistance, or bolstered, such as traditional UI, in an effort to mitigate the economic effects caused by the coronavirus pandemic. Hopefully, state officials will look to these benefits before establishing additional programs that may hinder recovery and job creation as we reopen the economy.

About the authors

Stephanie Ferguson Melhorn

Stephanie Ferguson Melhorn is the Senior Director of Workforce & International Labor Policy. Her work on the labor shortage has been cited in the Wall Street Journal, Washington Post, and Associated Press.

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