Legal Update by Attorneys Nicholas Cooling & Alison Stewart and Law Clerk Jordan Gehlhaar

Recently, Deputy Workers’ Compensation Commissioner William Grell issued anarbitration decision defining what constitutes the “shoulder” under Iowa law. One of the main issues was whether the claimant’s work injury should be compensated with permanent disability benefits as a scheduled member injury to the left shoulder, as a bilateral shoulder injury, or as an unscheduled injury. Ultimately, the Iowa statute was construed liberally, for the benefit of the injured worker.

While completing maintenance work as an employee of McDonald’s on April 18, 2018, Claimant Smidt tripped over a box and struck his left side on a steel beam. His injuries included tears of the supraspinatus and infraspinatus tendons, or rotator cuff.

Prior to amendments to the Iowa Workers’ Compensation laws in July of 2017, the shoulder was considered proximal to the arm, and was compensated as industrial disability, an unscheduled injury. Through the 2017 amendments, the Iowa legislature specified that injuries to the “shoulder” should be compensated as scheduled member injuries on a 400-week schedule. However, the deputy concluded, the legislature’s language was ambiguous as to what constitutes the “shoulder.”

Claimant argued that the injuries were proximal to the glenohumeral (shoulder) joint, and should be an unscheduled injury compensated with industrial disability pursuant to Iowa Code Section 85.34(2)(v) (2017). The defendants argued the injury was limited to the left shoulder and should therefore be compensated as a scheduled member injury pursuant to Iowa Code Section 85.34(2)(n) (2017).

The Deputy Commissioner determined that the legislature made a conscious decision to add the “shoulder” as a scheduled member injury, resulting in significantly less compensation to an injured worker. Additionally, it was determined that the legislature likely knew, based on prior decisions, that an injury to the rotator cuff would be proximal to the “shoulder” joint, and therefore compensable to the body as a whole. The deputy reasoned that there is a difference between the “shoulder” and the surrounding anatomic parts (tendons and muscles) that operate the shoulder, which is consistent with Dr. Kuhnlein’s opinion in the case, as well as prior Commissioner’s findings inNazarenus v. Oscar Mayer & Co. in 2008.

Mr. Smidt was involuntarily terminated at the change of management and later found employment as a part-time truck driver. Considering the traditional industrial disability factors, the deputy made an award of 40% industrial disability.

Overall, these findings are consistent with those in Chavez v. MS Technology, LLC, File No. 5066270 (Feb. 5, 2020) andDeng v. Farmland Foods, Inc., File No. 5061883 (Feb. 28, 2020) – two similar decisions since the 2017 amendment. In effect, this decision indicates the agency’s progression since the 2017 amendments, toward body as a whole classification when injury of the shoulder is involved. Under the current case law, any time the injury extends into the proximal portion of the shoulder joint, we can expect the agency to find a body as a whole injury, where industrial disability analysis may be appropriate. However, as this decision suggests, additional guidance in the form of statutory language and parameters of what constitutes “shoulder,” is necessary and Peddicord Wharton will continue to monitor the case law as this issue continues to develop.

If you'd like to sign up for our e-newsletter, please click here.

~~~~~~~~~~~~~~~~~~~~~~~~~~~

NOTICE TO THE PUBLIC

The determination of the need for legal services and the choice of a lawyer are extremely important decisions and should not be based solely upon advertisements or self-proclaimed expertise. This disclosure is required by rule of the Supreme Court of Iowa.

Peddicord Wharton Legal Updates are intended to provide information on current developments in legislation impacting our clients. Readers should not rely solely upon this information as legal advice. Peddicord Wharton attorneys would be pleased to answer any questions you may have about this update. ©2020 Peddicord Wharton. All Rights Reserved.

JUNE 2020

COVID-19 CLEARS THE WAY FOR TELEHEALTH TO TREAT TENNESSEE WORKPLACE INJURIES

One of the most fundamental rights of an injured worker under the Tennessee Workers’ Compensation Law is the right to medical treatment for the work-related injury or illness. Typically, this medical treatment is provided by a medical provider chosen by the injured worker from a list of doctors – i.e. the medical panel.  The statute requires that the medical panel consist of providers who are located in the employee’s community, with the clear intent being that the medical provider needs to be located near enough to where the injured worker lives so that the injured worker can be treated by the medical provider without any undue burden or expense of excessive travel. This entire framework assumes that the injured worker will receive treatment by physically going to the doctor’s office and by undertaking an in-person medical visit with the provider. Indeed, that is exactly what was required under the Tennessee Workers’ Compensation law – that is, until the COVID-19 pandemic.

Before COVID-19, the Tennessee Workers’ Compensation Law did not provide for nor did it allow an injured worker to receive treatment for his or her injury via a telehealth visit.  However, that has now changed.

The first step occurred on March 17, 2020, when the Trump Administration announced expanded Medicare telehealth coverage to enable beneficiaries to receive a wider range of healthcare services from their doctors without having to travel to a healthcare facility. Prior to this announcement, Medicare was only allowed to pay clinicians for telehealth services such as routine visits in certain circumstances. For example, the beneficiary receiving the services must live in a rural area and travel to a local medical facility to get telehealth services from a doctor in a remote location. In addition, the beneficiary would generally not be allowed to receive telehealth services in their home. President Trump’s announcement came at a critical time as these new flexibilities would help healthcare institutions across the nation to offer some medical services to patients remotely, so that healthcare facilities like emergency departments and doctor’s offices remain available to deal with the most urgent cases and to reduce the risk of additional infections.

On March 25, 2019, the Tennessee Bureau of Workers’ Compensation issued a notice stating, for the first time, that a panel-chosen physician may utilize telehealth in the treatment of an injured worker. The notice clarified that there is no specific provision in the law that addresses the subject of a telehealth provider to be listed on the medical panel.  Payment was directed to be made in accordance with all guidelines from the U.S. Centers for Medicare & Medicaid Services (CMS), including those announced on March 17, 2020. 

The Tennessee Bureau of Workers’ Compensation provided even further guidance on April 1, 2020, by issuing its Temporary Guidance on Telehealth for Workers’ Compensation.  This guidance specifically allows for telehealth in the context of workers’ compensation during the COVID-19 national emergency, to provide appropriate care continuation and to improve functional considerations for both new and established patients. The Bureau required that telehealth visits be conducted by telephone only or by video/audio links with the express agreement by both patient and provider. Although recommended to have the appropriate Tennessee licenses, certain requirements were waived for specific qualified providers. Moreover, certain telecommunications applications not previously allowed are now permitted for use during this period, including Skype and Facetime. It is anticipated that the provider will still make a good faith effort to protect patient privacy, and records should be kept as if the visit were in-person. Medical providers may bill for the visits using standard billing forms, and the bill should be paid pursuant to the applicable Medical Fee Schedule. 

On April 30, 2020, CMS announced that it was waiving certain requirements of federal law which specify the types of practitioners that may bill for the services when furnished as telehealth services. The waiver of these requirements expands the types of health care professionals who can provide telehealth services. As a result, physical therapists, occupational therapists, and speech language pathologists were permitted to use telehealth to provide many Medicare services.

On May 1, 2020, this issue was also addressed by Governor Bill Lee in Executive Order No. 32. That Executive Order addressed physical, occupational, and speech therapy via telemedicine for workers’ compensation claimants, and it temporarily suspended certain existing workers’ compensation regulations to specifically allow those types of services to be delivered via telemedicine. The Order also specified that the billing for such services should be reimbursed as if the services were delivered in-person. 

As you can see from the above, in only about a month and half, we have gone from not being able to use telehealth at all in the context of workers’ compensation, to being able to use it routinely as a vital component of providing uninterrupted medical care for injured workers.  Not only does this help the injured worker by providing continued care, it also helps employers and their workers’ compensation carriers by helping to ensure that workers’ compensation claims will continue to move toward resolution in an orderly fashion. After all, a claim cannot typically be resolved until the employee has completed his or her medical treatment with the authorized treating physician and placed at maximum medical improvement. Before the introduction of telehealth, COVID-19 presented quite an obstacle in this regard since most non-emergency medical care was placed on hold, including the necessary follow-up care for work injuries. However, the new availability of telehealth should benefit both injured workers and their employers by allowing that medical treatment to get back on track – at least to some extent. 

Obviously, telehealth is not the right solution for every situation. There will always be a need for in-person medical treatment, particularly at the beginning and end of treatment, and for direct procedures. However, for routine follow up care and therapy, telehealth will sometimes be the best solution to keep the claim moving forward in a timely fashion. While the above-described measures by the Tennessee Bureau of Workers’ Compensation are temporary and apply only during the COVID-19 pandemic, be on the lookout for more permanent measures. The benefits of telehealth under the right circumstances cannot be questioned, and it seems very likely that telehealth in some form is here to stay. 

Fredrick R. Baker, Member
Wimberly Lawson Wright Daves & Jones, PLLC
1420 Neal Street, Suite 201
P.O. Box 655
Cookeville, TN 38503-0655
Phone: 931-372-9123
Fax:  931-372-9181
fbaker@wimberlylawson.com
www.wimberlylawson.com

A key doctrine in the law known as “respondeat superior” provides that an employer is responsible for the acts of its employees performed within the course of their employment.  Whether that doctrine applied to an employee who had a motor vehicle accident after being summoned to a training meeting was the issue in Samol v. Vanlaningham, No. A-5058-18T2 (App. Div. June 3, 2020). 

The facts involved a high school student, Ryan Vanlaningham, who was called by his store manager to attend a training meeting at Party City where he worked in March 2016.  Vanlaningham was informed that he would be compensated at his usual hourly rate for the training meeting, and he would work his regular shift the same day.  He was not compensated for the time driving to the training meeting at his work location.  While driving to the training meeting, Vanlaningham’s vehicle struck a vehicle owned by Pablo Samol.  A passenger in Samol’s car, Beatrice Samol, was injured and filed a lawsuit naming Vanlaningham and his employer, Party City, as defendants.

Party City opposed the law suit and moved to dismiss it.  The company argued that Vanlaningham was not in the course of his employment when he was driving to work for the training meeting under the going-and-coming rule.   Samol countered that this was not a normal commute to work because Vanlaningham was either compelled to go to work or was on a special mission, two exceptions to the premises rule, which replaced the going-and-coming rule in New Jersey in 1979.

The trial judge ruled that Vanlaningham had not arrived at work when the accident occurred, and therefore Party City was not liable for his actions.  The judge concluded that the training meeting was a normal and routine part of the young man’s employment.  The Appellate Division agreed with the trial judge but considered the argument of Ms. Samol that Vanlaningham was “compelled” to undertake the actions of driving to the training meeting.  The Court reviewed the two leading cases on compulsion in workers’ compensation, namely Sager v. O. A. Peterson Constr. Co. and Lozano v. Frank De Luca Constr.  Those cases stand for the proposition that an otherwise non-compensable activity can become compensable if the employer compels an employee to perform the activity.

The Court seemed to blend the special mission and compulsion arguments together: “Here, there was no credible basis to support the assertion defendant controlled Vanlaningham’s commute or that his commute fell within the scope of his job duties.  The facts did not demonstrate Vanlaningham’s commute was pursuant to a special mission; he was traveling to his regular place of employment on one of his pre-scheduled workdays.  For these reasons as well, his drive to work on the day of the incident was not a compelled activity.”

The decision of the court is clearly correct and the reasoning is a sound. But the court slightly missed the mark on the special mission argument.  The statute states that a special mission only applies when the employee is required to be away from the employer’s place of employment.  N.J.S.A. 34:15-36.  Here the drive was directly to the normal place of employment.   Therefore, it could not be considered a “special mission.”

As for the compulsion argument, all employees are compelled to go to work.  Attendance at work is not optional, as we all know.  The compulsion line of cases is a valid one in New Jersey.  However, it only applies to activities that are not normally required of employees. Since all employees are compelled to report to work, the compulsion argument really made no sense.  If the court were to entertain the argument that a drive to the normal work site was compelled, it would completely undercut the goal of the 1979 Amendments, which was to do away with the many exceptions in the law to the going-and-coming rule. 

--------------------------------

John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

By: Bill Davis (Associate Attorney - Santa Rosa)

On May 27, 2020, the Sixth Appellate District issued its long-awaited decision in County of Santa Clara v. WCAB (“Justice”). This decision dramatically curtails the application of the Hikida case, which is regularly cited by the Applicant’s bar to severely limit or even eliminate apportionment. 

It is important to notes that the Justice Court did not disagree with the Hikida decision. Instead, it held that the Hikida decision was being applied in an overbroad and inappropriate manner. 

The Justice Court agreed that Defendant was responsible for a new injury that was the consequence of medical treatment. It further agreed that “[A]n employee is entitled to compensation for a new or aggravated injury which results from the medical or surgical treatment of an industrial injury.” The Court noted that, while these statements are correct, they are not the end of the discussion. “However, it does not follow that an employer is responsible for the consequences of medical treatment without apportionment, when that consequence is permanent disability”. This is key for the defense community because applicant attorneys have been using Hikida to argue that there is no apportionment when permanent disability results from medical treatment. 

The Justice Court relies upon Labor Code sections 4663 and 4664 and the numerous cases which applied these sections, particularly the Lindh decision (City of Petaluma v. WCAB (Lindh)). The Justice Court notes, “There is no case or statute that stands for the principle that permanent disability that follows medical treatment is not subject to the requirement of determining causation and thus apportionment, and in fact such a principle is flatly contradicted by sections 4663 and 4664”. In other words, the Justice Court seems to indicate that where there is permanent disability from any industrial source, Defendant should have the ability to assert apportionment. 

The Court specifically held that that the Hikida decision finding no apportionment “makes sense only because the medical treatment in Hikida resulted in a new compensable injury, namely CRPS, which was entirely the result of the industrial medical treatment”. The emphasis is in the original opinion. The Justice Court was clearly stating that apportionment is required unless the medical treatment resulted in a new condition which was entirely the result of that treatment. Otherwise, per Lindh, “the salient question is whether the disability resulted from both nonindustrial and industrial causes, and if so, apportionment is required”. Citing 4333(a), Lindh, and Acme Steel, the Court held “Where there is unrebutted substantial medical evidence that non-industrial factors played a causal role in producing the permanent disability, the Labor Code demands that the permanent disability “shall” be apportioned”. Defendants still must meet their burden of proof to substantiate apportionment. If medical treatment has caused a “new injury” the evidentiary efforts to prove up apportionment start anew with regard to that new injury. Additionally, per Benson, distinct disabilities must each be taken on their own and cannot be merged. 

There is another aspect of this decision that will be of great benefit to the defense community. The treatment in the Justice case was bilateral knee replacements. There has been substantial litigation since SB 899 on the issue of whether a defendant can obtain apportionment where a joint, and thus the underlying degenerative condition, has been replaced. Most of the more recent cases found that it is permissible, but these have been lower level or writ denied cases. We now have a published Court of Appeal case in which apportionment was allowed where there has been a joint replacement. Still, nothing can be taken for granted and defendants must ensure they have substantial evidence to support apportionment in each particular case. 

This case is a blow to the overbroad application of Hikida that we have seen since the decision issued. Now, a defendant has the ability to apportion liability of permanent disability partly caused by medical treatment. Hikida is now limited to those rare situations where medical treatment results in an entirely new condition, and that condition is not subject to apportionment for non-industrial factors. As an added bonus, defendants have a much stronger argument for apportionment in a joint replacement case. In all, this is a great decision that further strengthens the concept that an employer is only liable for the permanent disability caused by their injury. 

If you have questions about how this decision specifically impacts your case, contact the author, Bill Davis at wdavis@hannabrophy.com.    

See the below press release regarding Gov. Beshear's ALJ appointments and Nominating Committee appointments.

Governor Beshear Makes Appointments to Kentucky Boards and Commissions

On Monday, June 1, 2020 at 11:00 am (CST) a panel of experienced workers’ compensation defense attorneys representing different regions of the United States will present a timely and comprehensive webinar entitled:Establishing a "New Normal"During COVID-19. This is the forth in a series of free webinars sponsored by WorkersCompensation.com in collaboration with the National Workers' Compensation Defense Network at the Center for Education Excellence.

The webinars are free. All you have to do is register.

REGISTER HERE FOR THE WEBINAR

About the Author

This blog submission was prepared by Mike Fish, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Fish by e-mailing him at mfish@fishnelson.com or by calling him directly at 205-332-1448.

Claimant was involved in a compensable 2003 work accident with an accepted L4-S1 fusion performed in 2005, by Dr. Eppley. Following the surgery, claimant was discharged by her surgeon and referred to pain management. Claimant remained in continuous pain management to the present, with narcotic medications, injections, and various other conservative care. In 2017, Claimant returned to Dr. Eppley, who recommended adding L2-4 to her original fusion, citing suspected adjacent segment disease. Claimant filed a Petition seeking approval of the surgery. Employer filed a Petition seeking to discontinue ongoing narcotic medications.

The Board found that the recommended surgery was not reasonable and necessary treatment, accepting the opinion of defense expert Dr. Fedder over Dr. Eppley. The Board noted that contrary to the rosy picture painted by Dr. Eppley in his deposition as to the outcome of the first surgery, the medical records showed “at best” this procedure caused 30% improvement in claimant’s subjective complaints only. The procedure did not allow claimant to return to work, or reduce her treatment, narcotic medications, and the like. To the contrary, pain management treatment increased and was uninterrupted for years following the surgery. The Board also noted that the proposed surgery would not fix claimant’s multiple unrelated comorbid conditions that significantly impacted her function, such as the need for bilateral knee replacements, rheumatoid arthritis, and morbid obesity. The Board further opined, based upon the testimony of defense expert Dr. Nathan Schwartz, that claimant’s narcotic medications should be discontinued due to lack of functional improvement.

Should you have any questions regarding this Decision, please contact Greg Skolnik, or any other attorney in our Workers’ Compensation Department.

Carmen Kelley v. First Student, IAB Hrg. No. 1238448 (Apr. 6, 2020).

302-573-4800 www.hfddel.com.

By: Patty Robbins (Associate Attorney - Redding)

On March 18, 2020, H.R. 6201, the “Families First Coronavirus Response Act,” was signed into law. This emergency measure provides benefits for the many Americans that have been (or soon will be) affected by COVID-19. The Act primarily address the following concerns: access to food, paid leave, and costs of testing and treatment.

This article will address the changes that are most likely to affect employers – the Emergency Family and Medical Leave Expansion Act and the Emergency Paid Sick Leave Act. As will become clear, these changes place a financial burden on businesses employing fewer than 500 people. The Acts do not apply to larger employers. Division G attempts to address this financial burden by allowing a tax credit equal to 100% of the qualified sick leave wages paid. Consultation with labor counsel and tax advisors is recommended.

Emergency Family and Medical Leave Expansion Act

The Family and Medical Leave Act of 1993 (“FMLA”) entitles employees to 12 workweeks of leave during any 12 month period:

•  for the birth of a child,
•  for adoption,
• to provide care for an immediate family member with a serious health condition,
• due to one’s own serious health condition, or
• due to “any qualifying exigency” determined by regulation arising from an immediate family member’s active duty in the Armed Forces.
  

To be eligible, the employer must have “50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year.” (Section 101(4)(A)(i)). Also, the employee must have at least 12 months of employment and 1,250 hours of service within the preceding 12 months of employment. (Section 101(2)). An eligible employee that contracts COVID-19 such that he or she has to be hospitalized would likely be eligible for FMLA under the original statute.

The Emergency Family and Medical Leave Expansion Act (“the Expansion Act”), focuses on the impact to families of the preventative measures taken to address the COVID-19 pandemic including school closures and shelter in place orders.

The Expansion Act temporarily adds to the reasons for leave “a qualifying need related to a public health emergency.” The statute is careful to limit the scope of the term “emergency” to those declared by a Federal, State, or local authority relating to COVID-19. California Governor Gavin Newsom declared a state of emergency relating to COVID-19 on March 4, 2020 and the President of the United States declared the same on a national level on March 13, 2020. Therefore, the “qualifying need” must arise from the effects of the current COVID-19 pandemic addressed in those declarations.

What is a “qualifying need?” Under Section 102(a)(1)(F)(A) a “qualifying need” means, “the employee is unable to work (or telework) due to a need for leave to care for the son or daughter under 18 years of age of such employee if the school or place of care has been closed, or the child provider of such son or daughter is unavailable, due to a public health emergency.” Therefore, any schooling or child care that is disrupted as a result of the declared states of emergency may make an employee eligible for FMLA. If the need for leave is foreseeable, the Expansion Act requires the employee to provide the employer with notice “as is practicable.” (Section 110(c)).

Leave on a public health emergency basis is different than the other types of leave in two notable ways. First, an employee becomes eligible for leave on public health emergency grounds after just 30 calendar days of employment. (Certain health care providers and emergency responders may be ineligible at the election of their employer pursuant to section 2105. They could also be deemed ineligible in the future by the Secretary of Labor under section 110(a)(3)). Second, the Expansion Act applies to all employers with “…fewer than 500 employees.” It does not apply to large businesses. Considering that small businesses are less likely to have remote work options and the Expansion Act places a large financial burden on the employers, it includes a gateway to exempt small businesses with fewer than 50 employees if it “would jeopardize the viability of the business as a going concern.” (Section 110(a)(3)).

What benefits are due? Under the Expansion Act, the first ten (10) days of leave for a public health emergency may be unpaid and during that time the employee may use accrued time. After that, the employer “shall provide” paid leave of not less than two thirds of an employee’s regular rate of pay based on the number of hours he or she would normally work, “not to exceed $200 per day and $10,000 in the aggregate.” (Section 110(b)). Consult your labor counsel with any questions regarding calculating amounts due as they may vary based on specific facts. In the case of multi-employer collective bargaining agreements, the payments may be made to a multi-employer fund that provides paid leave to employees.

Although the Expansion Act increases the burden on small businesses in some ways, it loosens it in others. First, it exempts businesses that do not have “50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year” from the enforcement provisions of the FMLA. (Section 110(a)(1)(B)). Those provisions make an employer civilly liable if it interferes with an employee’s ability to obtain FMLA benefits. (Section 107). Second, it exempts businesses with fewer than 25 employees from the requirement that an employee’s position be restored upon return from FMLA leave in these scenarios: a) when leave is taken under the “public health emergency” provision, b) when the position no longer exists due to economic conditions or other changes in operating conditions, c) when the employer makes reasonable efforts to restore the employee to a similar job, and d) when the employee contacts the employee to offer an equivalent position. (Sections 104(a), 110(d)).

Notably, leave under the Exemption Act is limited and will be allowed only through December 31, 2020. Hopefully, school closures and other shelter in places orders will be lifted long before that. If not, we may see an amendment to that deadline.

To summarize, the Emergency Family and Medical Leave Expansion Act generally allows any employee working for an organization with fewer than 500 employees, that has been employed for at least 30 calendar days, to request FMLA in order to care for a minor child who’s school or daycare has become unavailable due to the current COVID-19 pandemic. When eligible, an employer must pay at least two-thirds of that employee’s regular pay (excluding the first ten days) not to exceed $200 per day or $10,000 total.

Emergency Paid Sick Leave Act

Until December 31, 2020, this new legislation mandates private employers with fewer than 500 employees and non-private employers with more than 1 employee, to provide non-carry over paid sick time (80 hours for full-time employees and for part-time employees what they would have worked over two weeks) for any employee that cannot work due to one of the following reasons:

1. The employee is subject to a government-mandated COVID-19 isolation order or quarantine,
2. The employee has been advised to self-quarantine by a health care provider,
3. The employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis,
4. The employee is caring for an individual who (a) is subject to a government-mandated COVID-19 isolation order or quarantine, or (b) has been advised to self-quarantine by a health care provider,
5. The employee is caring for their child whose school has been closed or child care provider is unavailable due to COVID-19 precautions, or
6. “The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.”
   

The benefits are paid at the employee’s regular rate of pay or the minimum wage, whichever is higher. (Section 5110(5)(B)(i)). Benefits are limited to $511 per day or $5,110 in the aggregate if leave is taken for items 1, 2, or 3. They are limited to $200 per day or $2,000 in the aggregate if leave is taken for items 4, 5, or 6. (Section 5110(5)). Also, if leave is taken under items 4, 5, or 6, compensation is paid at two-thirds of the applicable pay rate. (Section 5110(5)(B)(ii)). The Secretary of Labor may exempt small businesses with fewer than 50 employees if it would “jeopardize the viability of the business…” (Section 5111).

An employer or the Secretary of Labor may elect to exclude health care provides or emergency responders. (Sections 5102, 5111). Also, employers participating in multi-employer collective bargaining agreements may fulfill the requirements by contributing to a multi-employer fund that provides the employee with sick time. (Section 5106).

However, an employer may not require an employee to find a replacement employee to cover his or her shift. An employer also may not require an employee to first utilize accrued time. (Section 5102). An employer also may not “discharge, discipline, or in any other manner discriminate against” an employee that takes leave under the Act or institutes proceedings under the Act. (Section 5104). Employers are mandated to keep a posted of these benefits, which will be available in the near future. (Section 5103).

An employer that fails to pay sick leave or terminates an employee for use of this Act will be considered to be in violation of the Fair Labor Standards Act of 1938 subject to penalties. (Section 5105).

The Emergency Paid Sick Leave Act is very similar to the Expansion Act described above, but far broader. Pursuant to section 5107, it does appear that an employee can seek benefits under both Acts.

Keep an eye on our website for additional analysis and webinars, including the state of Temporary Disability Indemnity issues following COVID-19.

By: Brenna Hampton (Office Managing Partner - San Diego)

Governor Newsom just announced an Executive Order creating a temporary, rebuttable presumption of industrial injury for employees at work who contracted COVID-19 between 3/19/2020 – 7/04/2020. Here are the highlights:

– Rebuttable presumption with 4 requirements (all 4 must be satisfied):

• Positive test or confirmed diagnosis required.  Must test positive within 14 days after the EE performed labor / services at their place of employment
• Labor / Services were performed after 3/19/2020.
• Does not apply to work done remotely at the employee’s home or residence
• If presumption is based on a diagnosis (as opposed to a positive test), the diagnosis must have been done by a physician  who holds a physician and surgeon license issued by the California Medical Board, and confirmed by further testing within the 30 days of the date of diagnosis.
  

– The presumption of compensability applies for 60 days from 5/06/2020.

– REDUCED period to deny (30 days instead of 90) – 30 days from filing of the claim form, unless rebutted by evidence discovered after the 30-day period.

– LC4850 / Temporary Disability:

• Must test positive or be diagnosed on or after 5/6/20.
• Must be certified within the first 15 days after the initial diagnosis
• Must be recertified every 15 days within the first 45 days, then every 45 days following diagnosis OR EE who has tested positive may obtain a certification within 15 days of 5/6/20 documenting the period of temporary disability and must be recertified every 15 days thereafter for the first 45 days following diagnosis.
• Paid sick leave benefits available in response to COVID-19 must be used and exhausted before TD/4850 are due/payable. No waiting period for TD benefits.
  

– If death results, no benefits payable to the state (Death without Dependents Unit)

– Apportionment to permanent disability allowed under LC4663 and LC4664.

– Standard workers’ compensation benefits – no specific reimbursement for PPE, lodging or other expenses, like those contemplated by the proposed AB664. The Executive Order makes employers liable for full hospital, surgical, medical treatment, disability indemnity, and death benefits in the event of industrial COVID-19.

Pending Presumptions – AB664,  SB 1159, SB 893 (hospital workers), AB 196 (“essential” workers)

There are now four proposed California state bills addressing issues related to COVID-19. The legislature reconvened this week so we anticipate something soon. Until then, discovery should proceed as usual and employers and their agents should strive to remain in compliance with the 5/06/20 Executive Order.  It can be anticipated that the California legislature as well as the industry at large will assess the response and results from today’s executive order for further guidance.

The four proposed bills discussed below attempt to close gaps, add protection for certain workers, and generally expedite the provision of benefits to injured California employees.  In a rebuttable presumption, the effect is to shift the burden of proof away from the employee such that the employer must disprove that the alleged injury is industrial. With a conclusive presumption, the employer loses the right to do this at all and, once exposure is shown, the employer must provide all related benefits.

Bill #1: Assembly Bill 196 – Presumption for broader group of essential workers, conclusive

This bill was introduced in January, but amended yesterday, 5/05/20 and would create a conclusive presumption of industrial injury for “essential employees” with COVID-19 occurring on/after 3/01/2020 and extending for a period of up to 90 days following the last day of actual work.

The Bill would define essential employees as those defined in Governor Newsom’s Executive Order N-33-20, which alludes to 16 critical infrastructures, or those who are “subsequently deemed essential”. https://www.cisa.gov/identifying-critical-infrastructure-during-covid-19. Certain employees would be excluded – active firefighters, peace officers, and health care employees who provided direct patient care, likely because they are already covered by existing or proposed presumptions for COVID-19.

Here is the link to the proposed text:

http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB196

Bill #2: Senate Bill 893 – Presumption for hospital employees, rebuttable

This bill was proposed 1/28/2020 and would define “injury” for a hospital employee who provides direct patient care in an acute care hospital to include infectious diseases, musculoskeletal injuries, and respiratory diseases when those conditions arise or manifest during employment.  Here is the link to the proposed text:

http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201920200SB893

Respiratory disease is clearly defined in the proposed bill to include COPD, asthma, COVID-19, and other respiratory diseases caused by novel pathogens. Musculoskeletal injuries are broadly defined to include acute injury or cumulative trauma of the muscles, tendons, ligaments, bursas, peripheral nerves, joints, bones, or blood vessels.”  The proposed bill would create a rebuttable presumption that these types of injuries are industrial.  This is extremely broad language that would open the door for hospital workers providing acute care to receive extensive benefits for a variety of everyday injuries.

The presumption would also be extended for a period of three calendar months for each full year of employment, up to 60 months from the last date actually worked. MRSA infections would extend to a hospital employee following termination of employment for 90 days from the last date of actual work.  Respiratory conditions would be extended for up to 120 months from the last date of work.

One area of concern is the proposed language that if one of these conditions develop in a hospital worker who provides direct patient care in an acute care hospital would not be “attributed to a disease that existed before development or manifestation.”  It sounds as though the intent is to prevent apportionment of permanent disability, though unlike the proposal in AB 664, there is no clear intent to amend LC4663 stated in the proposed SB893.

Bill #3: Senate Bill 1159: Rebuttable presumption, with broader application to “critical employees” of essential employers

This preliminary proposal for SB 1159 is more balanced than AB 664 that has also been proposed. AB 664 wanted to remove apportionment and would create a conclusive presumption that COVID-19 is work-related. SB 1159 would create a “disputable” (rebuttable) presumption, would not alter the laws regarding apportionment, but it would potentially impact a much broader array of employees, which are not fully defined.

SB 1159 (not yet law) would create a rebuttable presumption of work-related COVID-19 for “critical employees.” This seems to be defined loosely and will be subject to interpretation (see below): (2) “Critical worker” means a public sector or private sector employee who is employed to combat the spread of COVID-19. It is the intent of the Legislature that this group of workers be explicitly identified in order to ensure that they receive all necessary health care through the workers’ compensation system. 

This bill appears to be aimed at first responders, not just employees of essential businesses. This is likely to be a hot button topic during discussion once the Legislature reconvenes.  With the new Executive Order, the Governor has indicated the intent to cover a broad swath of the workforce, but, again, the definition remains subject to various perspectives and legislative approval.

Here is a link to the proposed bill:

http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201920200SB1159

(proposed Labor Code Section 3212.86)

 (a) This section applies to critical workers who directly interact or previously directly interacted with the public during the COVID-19 pandemic.

(b) The term “injury,” as used in this division, includes illness or death resulting from exposure to COVID-19 if all of the following circumstances apply:

(1) The injury develops or occurs during a period in which a critical worker is in the service of an essential critical infrastructure employer.

(2) The injury is confirmed by a positive laboratory test or, if a laboratory test was not available, as diagnosed and documented by the critical worker’s physician based on the employee’s symptoms.

(3) The injury results in hospitalization or significant lost time beyond the critical worker’s work shift at the time of injury of at least ____ days due to the illness.

(c) The compensation that is awarded for injury pursuant to this section shall include full hospital, surgical, medical treatment, disability indemnity, and death benefits, as provided by this division.

(d) An injury that develops or manifests itself while a critical worker is employed is presumed to arise out of and in the course of the employment. This presumption is disputable and may be controverted by other evidence. Unless controverted, the appeals board is bound to find in accordance with the presumption.

(e) For purposes of this section, the following definitions apply:

(1) “COVID-19” means coronavirus disease 2019.

(2) “Critical worker” means a public sector or private sector employee who is employed to combat the spread of COVID-19. It is the intent of the Legislature that this group of workers be explicitly identified in order to ensure that they receive all necessary health care through the workers’ compensation system.

(f) This section shall remain in effect only until January 1, ____, and as of that date is repealed.

Bill #4 (Assembly Bill 664) – the conclusive presumption, more liberal benefits contemplated

AB 664 (Cooper and Gonzalez) proposes to amend the California apportionment statute (LC 4663) as well as add COVID-19 to the definition of communicable diseases, a presumption for certain safety officers. This would also add “certain” hospital employees. As of right now, it does not specifically reference any other types of employees, which is surprising, but it appears to be a deliberate effort to streamline objections to the proposed bill and maintain consistency with existing LC3212 presumptions.

Specifically:

– AB 664, if passed, would add Corona Virus cases to the existing presumption for “communicable diseases” as an injury.

– Importantly, as proposed, AB 664 would also change the presumption to a conclusive presumption. Current law holds that the presumption is rebuttable by evidence. Making it a conclusive presumption means that a positive test = industrial injury for those employees, regardless of evidence of other exposure or pre-existing injury.

– The bill would also amend the apportionment statute to prevent employers from reducing permanent disability related to Coronavirus. Let’s say, for example, that an employee subject to this bill (again, if passed) had a history of lung transplant (or even severe pneumonia with lung damage), if the employee contracted coronavirus, any lasting damage to the lungs after coronavirus would be the employer’s burden.

Here is the text, as amended in Committee:

http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB664

Before it becomes law, it will go back to the floor for discussion and approval of the amended bill, there will hopefully be further amendments (ie: to make the presumption rebuttable) and then the Governor would need to review and approve it.

I see this as having two intents: 1) protect safety officers and hospital employees by ensuring a broad swath of benefits and eliminating judicial challenges to their benefits. There is likely great public and political support for this; and 2) an opportunistic taking advantage of the current state of affairs to strengthen existing laws in favor of the injured workers, with the goal of eroding apportionment in the long-term. Apportionment is the principal that employers in California are only liable for permanent disability directly resulting from an industrial injury.

Clarification will be required if this passes in its current form. For example, it is proposed for any COVID diagnosis post 1/1/2020 even though the Shelter in Place order didn’t come down until 3/04/2020. Who would be the excluded hospital employees if only certain hospital employees are covered? Would that be limited to hospital employees in direct contact with COVID-19, or all hospital employees working at a medical facility after 1/01/2020? It would seem that it should only extend for 14 days following termination of service rather than 90 days since the current medical authorities seem to think that’s the period within which symptoms are likely to manifest. Perhaps the 90 days was contemplated based on the 90-day delay period? Much is left open in its present state.

As to a conclusive presumption, the WCIRB has issued an estimate of the potential costs, and it is staggering. The WCIRB has estimated<https://wcirb.com/news/wcirb-releases-cost-evaluation-conclusive-covid-19-presumption> the cost of the presumption in AB 644 could range from $2.2 billion to $33.6 billion. The WCIRB estimates the midrange cost for the bill to be $11.2 billion, including $6.7 billion in medical costs and $3 million in loss adjustment expenses. For context, total work comp payments in 2018 were $23.5 billion, including $6.9 billion in medical benefits and $4.8 billion in loss adjustment expenses. (Click here to read more:

http://ww3.workcompcentral.com/news/story/id/eb701244be964c8e6842d0c7714f85108f6dceef)