Disability Insurance for Business OwnersIn many parts of the country, businesses are reopening their doors, but the coronavirus threat is not gone. As employees return to work, some will fall ill. When that happens, they might file for workers’ compensation, and new rules may make this easier.
The Timeline for Reopening
States are establishing their own stay-at-home orders and reopening guidelines, so there is considerable variation depending on the location.
California is currently going through a four-stage reopening plan. Lower-risk workplaces can reopen in stage 2, followed by higher-risk workplaces in stage 3. The stay-at-home order ends with stage 4. It’s not clear how long this process will take. Even in a best-case scenario, the coronavirus problem isn’t going to disappear overnight.
Workers’ Compensation Presumption
Under normal circumstances, filing a workers’ compensation claim for a virus or other infectious disease can be challenging. This is because it can be difficult to prove where the disease was contracted or that it was occupational in nature.
However, these are not normal circumstances.
Governor Newsom has signed an executive order that provides workers’ compensation presumption for COVID-19. Under the order, California workers who test positive for or are diagnosed with COVID-19 within 14 days of working may be eligible for rebuttable presumption, which means that any COVID-19-related illness will be assumed to have arisen out of the course of work for workers’ compensation purposes.
The presumption does not apply to work performed at the employee’s home. Additionally, employers can submit evidence to dispute the assumption that the virus was contracted at work. To qualify for presumption, the date of injury must occur between March 19, 2020, and July 5, 2020, which is 60 days after the order was issued.
Workplace Coronavirus Outbreaks
Many workers around the country have caught the novel coronavirus. Sometimes, the cases are clearly tied to work. For example, 85 COVID-19 cases have been linked to a fruit plant in Vancouver, Washington, according to KGW8. This includes 70 employees and 15 close contacts.
According to Mercury News, long-term care facilities, jails, prisons and food processing plants are emerging as major sources for outbreaks in California.
Despite the workplace risk, not everyone is happy with the workers’ compensation presumption for COVID-19. According to an opinion piece written by the president of the Valley Industry & Commerce Association, published in the Press-Enterprise, the order may be represent a costly overreach.
According to the Insurance Journal, a report from the Workers’ Compensation Insurance Rating Bureau of California predicted a mid-range cost estimate of $11.2 billion for the COVID-19 presumption. That report was published in April. However, a new report has revised the estimate significantly, and the new mid-range estimate is much lower at $1.2 billion. For reference, the estimated annual cost of workers compensation claims before the pandemic was $18.3 billion.
Resources for Employers
The California executive order regarding workers’ compensation is just one of many new rules that has been implemented during the coronavirus pandemic. See the California Labor & Workforce Development Agency’s Coronavirus 2019 Resources for Employers and Workers for more information on how employers can comply with COVID-19 rules.
Heffernan Insurance Brokers is here to answer all your workers’ compensation insurance questions. Contact us for more information.
