By Hon. Susan V. Hamilton, Former Assistant Secretary and Deputy Commissioner, California Workers’ Compensation Appeals Board
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CALIFORNIA COMPENSATION CASES
Vol. 88, No. 11 November 2023
A Report of En Banc and Significant Panel Decisions of the WCAB and Selected Court Opinions of Related Interest, With a Digest of WCAB Decisions...
By Hon. Susan V. Hamilton, Former Assistant Secretary and Deputy Commissioner, California Workers’ Compensation Appeals Board
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LexisNexis has selected some recently issued noteworthy IMR decisions that illustrate the criteria that must be met to obtain authorization for a variety of different medical treatment modalities. LexisNexis...
Rebuttable presumptions are not an unusual concept in workers’ compensation cases, but some may be unaware that new ones have been created. On 9/17/2020, as a result of the recent COVID-19 pandemic, Senate Bill 1159 added three rebuttable presumptions to the California Labor Code. Therefore, as of 3/19/2020, if an employee is injured by exposure to the COVID-19 virus at work, they are entitled to a rebuttable presumption of compensability with regard to workers’ compensation benefits.
The three rebuttable presumptions for COVID-19 exposure injuries are as follows:
The first and third presumption will be the two that are discussed in this article as they apply most broadly to injured workers statewide.
Applying the New Presumption of Labor Code § 3212.88 to the Facts
The idea for these rebuttable presumptions was sound, but practitioners are often unclear as to how the new law will be implemented. When Jerry Payan, a sales manager at a car dealership, succumbed to the COVID-19 virus on 8/25/2020, the WCAB had the opportunity to apply the facts of his case to the new Labor Code § 3212.88. See the Noteworthy Panel Decision (NPD) of Payan v West Coast Auto Sales, 2021 Cal. Wrk. Comp. P.D. LEXIS 222 (Appeals Board panel decision).
On 2/9/2021, five months after Mr. Payan’s death, his widow filed an application for workers’ compensation benefits listing her husband’s date of injury as 7/12/2020. It was not until several months later that the parties were able to determine the employer’s correct legal name, N&H Motors, and its respective insurance company, Technology Insurance administered by AmTrust. On 3/26/2021 applicant amended the Application for Adjudication to reflect both the employer’s correct name and to identify the appropriate insurance company.
Once the proper parties were identified, defendant filed a Declaration of Readiness to Proceed (DOR) on 6/1/2021. Defendant argued that the worker in this case did not meet the requirements of Labor Code § 3212.88, since there had been no “outbreak” of the disease as defined by that Labor Code section. Applicant had failed to object to the DOR and the matter was set for a priority conference on the issue of whether applicant’s death was industrial.
The priority conference was held on 6/21/2021, at which time applicant objected to setting the case for trial. Applicant argued that there had not been sufficient time to gather the necessary evidence and to complete discovery. Nevertheless, the judge ordered discovery closed and set the matter to be tried on 8/23/2021.
Applicant then filed a timely Petition for Removal with the WCAB which promptly vacated the judge’s decision to set the matter for trial. The commissioners explained that the issue as to whether or not a COVID-19 “outbreak” as defined in Labor Code § 3212.88 had occurred was a rather complicated matter. The few months of time allotted for this task was not sufficient to allow applicant to complete discovery. The matter was returned to the trial level to allow the judge to conduct regular conferences until discovery had been completed pursuant to Labor Code § 5502(c), which states as follows:
“The case shall be set for trial when discovery is complete or when the workers' compensation administrative law judge determines that the parties have had sufficient time in which to complete reasonable discovery.
How to Litigate a COVID-19 Presumption Case
Set forth below is a suggested approach to litigating a case where an employee has allegedly been exposed to the COVID-19 virus at work.
1. Determine which of the Three Presumptions Apply to Determine Burden of Proof
As set forth above, if the DOI is between 3/19/2020 and 7/5/2020, the rebuttable presumption found in Labor Code § 3212.86 applies. If the DOI is on or after 7/6/2020, the presumption under Labor Code § 3212.88 applies.
a. Labor Code § 3212.86 – Burden of Proof on Employer
Why is determination of the applicable statute so important? Because there are different conditions to be met which trigger the presumption under each one. Labor Code § 3212.86 is almost a strict liability statute absent a strong viable rebuttal. If the worker tests positive for COVID-19 within 14 days of the last date she or he performed services at her or his place of employment, the presumption applies, unless rebutted. The burden shifts to the employer to prove the employee contracted the disease somewhere other than the workplace by “other evidence. Unless controverted, the appeals board is bound to find in accordance with the presumption.” (See Labor Code § 3212.86(e).)
b. Labor Code § 3212.88 – Burden of Proof on Employee
On the other hand, if the DOI is after 7/6/2020 then Labor Code § 3212.88 would be applicable. In that situation, the burden of proof is on the applicant to prove that she or he contracted the COVID-19 virus at work during an “outbreak” of the illness. For instance, if applicant was the only person, in an employee pool of more than one hundred, to contract the virus, then applicant would fail in his or her burden of proof. This was the argument of Mr. Payan’s employer in his particular situation.
For guidance on this rather challenging issue, practitioners should carefully examine Labor Code § 3212.88(m)(4) which provides a definition of “outbreak.” That section indicates that an “outbreak” occurs when 4% of the employees at a “specific place of employment” test positive for COVID-19 within 14 calendar days of each other.
Labor Code § 3212.88(e)(2) also sets forth that nothing in the new COVID-19 presumption statutes negate the “preponderance of evidence” standard which is normally used in determining “an employee’s rights to compensation for an injury or illness under this division.” It will be interesting to see how the courts interpret the intersection of these two standards when a COVID-19 case is involved.
2. Determine the Correct Date of Injury (DOI)
For both Labor Code § 3212.86(b)(2) and Labor Code § 3212.88(b)(2), the date of injury is defined as follows:
“The date of injury shall be the last date the employee performed labor or services at the employee’s place of employment at the employer’s direction.”
In the case of Mr. Payan, the date of injury was unclear. The Application for Adjudication listed the date of injury as 7/12/2020, but it is not clear what exactly happened on 7/12/2020. Was that Mr. Payan’s last day of work and thus his last day of alleged COVID-19 exposure? Was that the day he tested positive for COVID-19? Or was that the day he died from the disease? As set forth above, since applicant has the burden of proving “outbreak,” evidence as to the various pertinent dates of each event will be critical.
PRACTICE TIP: It is strongly suggested that a timeline be created at first knowledge of a fact pattern such as this, to ensure each party obtains the evidence they need to sustain their respective burdens of proof during the discovery process.
3. BEWARE of the Shortened Time Period for Triggering the Presumption
All practitioners are aware that under Labor Code § 5402, if the employer fails to deny a claim within 90 days of the claim being filed, the injury is deemed compensable and can only be rebutted by evidence discovered subsequent to that 90-day period.
These new presumption sections recognize the existence of Labor Code § 5402 but tweak the time period in which the employer must act. To make it more interesting, the legislature designed each presumption to follow different time periods, both of which are shorter than the Labor Code § 5402 time period.
With regard to Labor Code § 3212.86(f) (injuries between 3/19/2020-7/5/2020), if employers do not reject a COVID-19 claim within 30 days, it is presumed compensable, and “is rebuttable only by evidence discovered subsequent to the 30-day period.”
With regard to Labor Code § 3212.88(f) (injuries on or after 7/6/2020), if employers do not reject a COVID-19 claim within 45 days, it is presumed compensable, and “is rebuttable only by evidence discovered subsequent to the 45-day period.”
PRACTICE TIP: Make sure the correct date of injury is listed on applicant’s claim form. It is not clear what the result would be if the DOI listed on the claim form is the date of the positive COVID-19 test or the date of death, instead of the correct date of last industrial exposure. If the wrong date of injury is listed on the claim form, the employer might argue a due process violation, in that they did not have adequate notice upon which to deny the claim. That is an issue no one would want to litigate.
4. What Evidence Can Be Used to Rebut the COVID-19 Presumption?
As discussed above, the two presumption code sections do not set forth what specific evidence is required to rebut the presumption. The statutes’ wording of “other evidence” is nebulous at best.
Labor Code § 3212.86(e)(1) (injuries between 3/19/2020-7/5/2020) provides “This presumption is disputable and may be controverted by other evidence.”
Labor Code § 3212.88(e)(1) (injuries on or after 7/6/2020) also provides “This presumption is disputable and may be controverted by other evidence.” However, with regard to injuries pursuant to Labor Code § 3212.88(e)(2), the statute allows for the following:
“Evidence relevant to controverting the presumption may include, but is not limited to, evidence of measures in place to reduce potential transmission of COVID-19 in the employee’s place of employment and evidence of an employee’s nonoccupational risks of COVID-19 infection.”
5. How is the Specific Place of Employment Defined?
Labor Code § 3212.86(i)(2) (injuries between 3/19/2020-7/5/2020) only defines “Place of employment” not including an employee’s residence.
Labor Code § 3212.88(m)(3)(A) (injuries on or after 7/6/2020) defines “specific place of employment” as “the building, store, facility, or agricultural field where an employee performs work at the employer’s direction. ‘A specific place of employment’ does not include the employee’s home or residence, unless the employee provides home health care services to another individual at the employee’s home or residence.”
It would be interesting if the courts denied the presumption to an employee injured by COVID-19 between 3/19/2020-7/5/2020 if the employee provided home health care services to another individual at the employee’s home or residence, but would allow the presumption under Labor Code § 3212.88. It’s unclear as to why this exception was not inserted into the language of Labor Code § 3212.86(i)(2) since both sections were drafted at the same time. Legislative oversight? Or intentional omission? Courts of the future will decide.
6. Do These Presumptions Apply to Pending Matters?
Labor Code § 3212.86(h) (injuries between 3/19/2020-7/5/2020) provides “This section applies to all pending matters except as otherwise specified, including, but not limited to, pending claims relying on Executive Order N-62-20. This section is not a basis to rescind, alter, amend, or reopen any final award of workers’ compensation benefits.”
Labor Code § 3212.88(m)(3)(A) (injuries on or after 7/6/2020) provides “This section applies to all pending matters, unless otherwise specified in this section, but is not a basis to rescind, alter, amend, or reopen any final award of workers’ compensation benefits.”
Every day it seems that new case law issues dealing with both pre and post COVID-19 fact patterns and legislation. It is important for practitioners to keep up to date on the changes and to become familiar with the proposed new WCAB regulations that will take effect as of 1/1/2022, which can be found at this link:
And do not forget about all those “new” WCAB regulations that took effect just before COVID-19 hit as of 1/1/2020. These regulations can be found at this link:
And of course, be aware of the WCAB state of emergency en banc decisions, some of which are still in effect, and some of which have been rescinded, since the COVID-19 pandemic began back in March of 2020. These can be found at the WCAB en banc decision link:
Reminder: Panel decisions are not binding precedent.
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