Workers' Compensation

COVID-19 Codified: Navigating the SB 1159 Presumptions, and Beyond

By Randy H. Pollak, Esq. and Viviana Santiago, Esq.

COVID-19 has turned the entire world upside down and inside out. In the world of workers' compensation, the impact of the disease on our system and our practice of law has been severe. However, Governor Newsom provided some order on September 17, 2020, when he signed into law Senate Bill 1159 (SB 1159). This legislation was designed to bring some level of structure to the handling of COVID claims in California's workers' compensation system. SB 1159's central framework comprises a fairly complex system of three distinct rebuttable presumptions, as well as a robust employer reporting requirement. SB 1159 was passed as an urgency bill and became effective immediately. This article reviews SB 1159 to provide a road map of the essential elements and common issues that will inevitably arise in the handling of these claims.

How Do Presumptions Work?

We begin our discussion with a foundational review of the different types of legal presumptions available and how they are applied in workers' compensation cases. In a workers' compensation case, the burden of proof rests with the party holding the affirmative of an issue (Lab. Code §3202.5). A presumption is an inference in favor of a particular fact that affects the burden of proof at trial. There are both conclusive and rebuttable presumptions in workers' compensation cases. When a presumption is conclusive, it is irrefutable. Once the party bearing the burden of proof establishes the requisite elements, no evidence to the contrary can overcome it (see, e.g., Fraire v. California Department of Corrections and Rehabilitation, 2020 Cal.Wrk.Comp. PD LEXIS 60: "It is well established that where the law establishes a conclusive presumption evidence will not be received to contradict it," citing People v. McCall (2004) 32 Cal.4th 175, 185; Kopping v. Workers' Comp. Appeals Bd (2006) 142 Cal.App.4th 1099, 1106: "Where the law makes a certain fact a 'conclusive presumption' evidence cannot be received to the contrary''). With a rebuttable presumption, once the party bearing the burden of proof presents a prima facie case, the burden shifts to the opposing party to present rebuttal evidence that may or may not overcome the presumption (see, e.g., Milpitas Unified School District v. WCAB (Guzman) (201O) 187 Cal.App.4th 808, holding the AMA Guides Fifth Edition provided the prima facie evidence of a rating that could be rebutted). In addition, there are two ways in which presumptions arise in the workers' compensation system. First, there are presumptions that apply when a party satisfies a checklist of requisite elements, such as when an applicant establishes membership in an employee class, suffers a particular type of injury, and/or suffers an injury on a particular date or during a particular period (see, e.g., Lab. Code §§3212, 3213, 3501, 4662). Second, presumptions may apply when a party fails to act within a prescribed time frame, such as when a defendant fails to timely deny a claim (Lab. Code §5402(6)).

Senate Bill 1159

SB 1159 adds three new sections to the Labor Code: 3212.86, 3212.87, and 3212.88.

Labor Code Section 3212.86: Executive Order Codified

SB 1159 codifies in Labor Code section 3212.86 Governor Newsom’s Executive Order N-62-20. This section applies a rebuttable presumption to any employee who worked outside their home at their place of employment between March 19, 2020, and July 5, 2020, and had a positive test for or was otherwise diagnosed with COVID-19 within 14 days of a day worked during that period. (A positive COVID-19 test is required within 30 days of a diagnosis.) Moreover, for COVID claims falling under the March 19-July 5, 2020 time frame, the illness is presumed compensable if the defendant does not deny the claim within 30 days after the claim form is filed. Such claims can be rebutted only with evidence discovered after the 30-day period that could not have been discovered sooner.

Labor Code Section 3212.87: Frontline Workers

Labor Code section 3212.87 extends the rebuttable presumption beyond July 6, 2020, only for select front­ line workers, such as firefighters, peace officers, and certain health care workers. Note: Job classes that qualify for this extension are extremely specific. Anyone handling a case potentially involving a frontline worker is urged to review in detail Labor Code section 3212.87(a)(l)-(11). For the presumption to apply, the applicant must establish that they belong to one of these worker categories and that they tested positive for COVID-19 within 14 days of a day they performed labor or services at their place of employment. In addition, the illness is presumed compensable if the defendant does not deny the claim within 30 days after the claim form is filed and can be rebutted only with evidence discovered after the 30-day period that could not have been discovered sooner.

Labor Code Section 3212.88: Outbreaks

By far the most complicated of the three presumptions of SB 1159 is Labor Code section 3212.88, also known as the "outbreak" presumption. This applies a rebuttable presumption to employees not covered under the frontline worker presumption who test positive during an outbreak at the employee's place of employment. For claims in which an applicant asserts the presumption based on an outbreak, the defendant has 45 days after the claim form is filed to investigate the claim. The essential requirements of the outbreak presumption are: • Employer has more than five employees. • Within 14 calendar days of an employee's last date of work, one of the following occurs at a specific place of employment (excluding the employee's home): (A) If the employer has 100 or fewer employees at a specific place of employment, 4 employees test positive for COVID-19. (B) If the employer has more than 100 employees at a specific place of employment, 4 percent of the of employees who reported to the specific place of employment test positive for COVID-19. (C) A local public health department, the State Depart­ ment of Public Health, the Division of Occupational Safety and Health, or a school superintendent orders a specific place of employment to close due to a risk of infection with COVID-19. The "specific place of employment" requirement has some nuance to it, especially for a worker who works at multiple sites for an employer. Labor Code section 3212.88 provides: In the case of an employee who performs work at the employer's direction in multiple places of employment within 14 days of the employee's positive test, the employee's positive test shall be counted for the purpose of determining the existence of an outbreak at each of those places of employment, and if an outbreak exists at any one of those places of employment, that shall be the employee's "specific place of employment." Thus, in calculating the requisite number of positive COVID tests, the applicant bringing the claim will be counted for each location where they worked.

How Is the Claims Administrator to Know If an Outbreak Has Occurred?

The claims administrator and the employer have dual responsibilities for collecting the data to support the outbreak presumption regime just described. First, regarding the claims administrator, Labor Code section 3212.88 provides: For purposes of applying the presumption in this section, the claims administrator shall continually evaluate each claim to determine whether the requisite number of positive tests have occurred during the surrounding 14-day periods. The employer has an ongoing responsibility to report to their administrator all positive COVID-19 tests among their employees. Specifically, Labor Code section 3212.88 provides: When the employer knows or reasonably should know that an employee has tested positive for COVID-19, the employer shall report to their claims administrator in writing via electronic mail or facsimile within three business days all of the following: (1) An employee has tested positive. For purposes of this reporting, the employer shall not provide any personally identifiable information regarding the employee who tested positive for COVID-19 unless the employee asserts the infection is work related or has filed a claim form pursuant to Section 5401. (2) The date that the employee tests positive, which is the date the specimen was collected for testing. (3) The specific address or addresses of the employee's specific place of employment during the 14-day period preceding the date of the employee's positive test. (4) The highest number of employees who reported to work at the employee's specific place of employment in the 45-day period preceding the last day the employee worked at each specific place of employment.

There is also a retroactive reporting requirement for employers to report positive COVID-19 tests before SB 1159 went into effect. Labor Code section 3212.88 provides: Any employer who is aware of an employee testing positive on or after July 6, 2020, and prior to the effective date of this section, shall report to their claims administrator, in writing via electronic mail or facsimile, within 30 business days of the effective date of this section, all of the data required in subdivision (i). For the data required by paragraph (4) of subdivision (i), 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 the effective date of this section. The claims administrator shall use the information reported under this paragraph to determine if an outbreak has occurred from July 6, 2020, to the effective date of this section, for the purpose of applying the presumption under this section. Importantly, there are substantial penalties for an employer that fails to do this. Specifically: An employer or other person acting on behalf of an employer who intentionally submits false or misleading information or fails to submit information when reporting pursuant to sub­ division (i) is subject to a civil penalty in the amount of up to ten thousand dollars ($10,000) to be assessed by the Labor Commissioner.

What About Employees Who Do Not Qualify for the Presumption?

The presumptions SB 1159 creates relieve many applicants from having to prove a causal connection between their employment and COVID-19. The connection is a very difficult one to make without the presumptions, given the highly contagious and widespread nature of this virus. Specifically, for nonoccupational diseases such as COVID-19, employees falling outside the presumptions will likely need to demonstrate they were at a special or materially greater risk than the general population (see, generally, Bethlehem Steel Company v. IAC (George) (1943) 21 Cal.2d 742; Pacific Employers Ins. Co. v. Industrial Acc. Com. (Ehrhardt) (1942) 19 Cal.2d 622).

Discovery Challenges

The criteria for pre-July 6, 2020, COVID-19 claims and post-July 6, 2020, claims for frontline workers are relatively straightforward. However, the outbreak presumption may present some unique challenges for applicants trying to establish that the presumption applies. These challenges include, but are not limited to: • Addressing issues of accuracy in employer reporting for purposes of proving an outbreak. The applicant may need to subpoena e-mails between an employer and a third-party administrator, interview coworkers, and depose the person most knowledgeable (PMK) to verify the number of positive cases. • Defining "specific place of employment," particularly for large employers with multi-building facilities. • Obtaining confirmatory information from employers with fewer than five employees, which the outbreak presumption does not cover. What kinds of information can be gathered to confirm that? For example, could the applicant request payroll records for the entire company at the time of the positive COVID-19 test? • Confronting measures the employer has taken and nonoccupational risks. Unlike with frontline workers, Labor Code section 3212.88 provides examples of the types of evidence that may be used to dispute and/or rebut the presumption, including evidence of preventive measures the employer has taken to reduce transmission, as well as evidence of the employee's nonoccupational risks of COVID-19 infection. Employers will also likely face discovery challenges, including but not limited to: • A shortened investigative period: Labor Code section 5402(6) provides for a 90-day investigative period, but Labor Code sections 3212.86 and 3212.87 allow for only 30 days. The outbreak presumption allows for 45 days. • Failure to deny a claim within time frames: The employer can rebut the presumption of compensability only with evidence that could not have reasonably been discovered during those 45 days. What is reasonable? Can you get a QME after 45 days? For an applicant's attorney, this may mean having to depose PMK/coworkers about whether the evidence could reasonably have been discovered during the 90/30/45-day period. • Interpretation of "specific place of employment": Applicants seeking to establish that the outbreak presumption applies are likely to litigate this issue. • Keeping track of who enters a "specific place of employment" in compliance with reporting requirements and to defend outbreak presumption claims.


This article has reviewed the essential features of the SB 1159 COVID-19 presumptions as a framework to handle workers' compensation cases. The article has also identified several discovery challenges practitioners may face in working through these presumptions. The universal hope for the future is that the pandemic ends quickly, but for now, SB 1159 provides us with some semblance of structure amid the chaos of COVID-19. Moreover, we hope the law is successful in encouraging employers to comply with health and safety protocols so businesses can safely re-open and the risk of additional infections in our communities is reduced.

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