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The Covid-19 Presumptions: Are They Truly Gone?

February 14, 2024

For more than three years, virtually everyone in the California workers’ compensation community had become familiar with the Covid-19 presumptions.  Labor Code sections 3212.86, 3212.87, and 3212.88 were passed as emergency legislation in response to the unprecedented pandemic that changed life as we knew it, beginning in the Spring of 2020.  Understandably, the legislature sought to protect those who were still working on site and were unfortunate enough to contract Covid-19.  All three Labor Code sections provided a rebuttable presumption of compensability and shortened the investigation periods for issuing a denial, depending on the worker’s vocation.

The Presumptions:

Labor Code section 3212.86 was rather narrow – any worker who was diagnosed with Covid-19 within 14 days of being on site at the direction of the employer between March 19, 2020 and July 5, 2020 would be entitled to the presumption, regardless of occupation.

Labor Code section 3212.87 applied to police officers, firefighters, and certain healthcare workers who provided direct patient care.  Any such employee would be entitled to a rebuttable presumption if diagnosed with Covid-19 within 14 days of being on site.  Investigation periods were reduced for such employees to a mere 30 days.  If liability was not rejected within 30 days after the filing of the claim form, the condition was presumed to be compensable.  This particular section was close to a strict liability provision – how to rebut the presumption was never specified.

Labor Code section 3212.88 applied to all other places of employment and occupations.  To qualify for the presumption, any worker diagnosed with Covid-19 within 14 days of working on site during an “outbreak” at the employer’s place of employment would be entitled to the presumption.  In other words, if 4 employees (or 4% if the employer had more than 100 employees at a specific site) contracted Covid-19, the employee would be entitled to the presumption of compensability.  Investigation periods were reduced for such employees to 45 days.  To controvert the presumption, the defendant could present evidence of measures in place to reduce transmission at the workplace along with evidence of an employee’s nonoccupational risks.

All three statutes, when passed, were set to be repealed as of January 1, 2023.

As the pandemic raged on, the California legislature introduced AB 1751 – a simple measure designed to extend the presumptions of LC 3212.87 and 3212.88 to January 1, 2025.  The bill passed easily – with one important change – the presumptions were only extended to January 1, 2024 – not January 1, 2025.

Impact of the Repeal:

Each Covid presumption statute clearly stated, “This section shall remain in effect only until January 1, 2024, and as of that date is repealed.”

Accordingly, anyone contracting Covid-19 after January 1, 2024, clearly no longer has the benefit of the presumption of compensability, regardless of occupation.  An employee contracting Covid 19 on or after January 1, 2024 is now relegated to proving industrial causation based on the transmissible disease standard of Labor Code section 3202.5, meaning, it was “more likely than not” that the employee contracted the condition as a result of industrial exposure.  The time in which to reject liability reverts to Labor Code section 5402, the usual 90 days before a claim is presumed compensable.

But what about an individual who contracted Covid-19 before the statutes were repealed? More specifically, what about an individual who contracted Covid-19 at any point during the application of the Covid-19 presumptions (i.e., from 03/19/2020 through 12/31/2023) who filed a claim, but the claim is still pending?  Does the employee still retain the benefit of the presumption when the claim was filed before the repeal occurred, or does the repeal of the statute have a retroactive effect?  That is, since the statute is gone, is the presumption gone too, regardless of when the claim was filed?

Could that truly be the case?  The California Legislature made it clear that SB1159 (the Covid presumptions) was an urgency statute “necessary for the immediate preservation of the public peace, health, or safety” within the meaning of the California Constitution.   The statute was passed in direct response to Governor Newsom’s declaration of a state of emergency on March 4, 2020.  Due to the heightened risk of Covid-19 infection to frontline workers, and those whose workplaces were experiencing an outbreak, the statute was put into effect immediately on 09/20/2020.

Would it make sense, then, to tell those who filed such claims, and were afforded the benefit of the presumption, that the presumption is no longer in effect merely because their claim has not been finalized?

In examining the statutory scheme of workers’ compensation laws and case precedent, the answer would appear to be “yes.”   The presumptions are gone – regardless of whether or not an employee has a pending case of contracting Covid 19 before the statutes were repealed. But what exactly does that mean?

Case Studies of Repealed Statutes:

In 2004, SB 899 was passed as an urgency statute – much like SB 1159 – “necessary for the immediate preservation of the public peace, health, or safety” and went into immediate effect.  The crisis at that time was a bit different – the California legislature was seeking relief from the effects of a perceived workers’ compensation crisis.  The changes to our system were, of course, dramatic.  One of the significant changes came about in the laws of apportionment.  SB 899 ushered in a new wave of statutes, including Labor Code sections 4663 and 4664, to specifically deal with the issue of apportioning permanent disability to pre-existing conditions or prior awards.  LC 4663 and LC 4664 replaced the former Labor Code Sections 4663 and 4750.  The emergency statutes of 2004, however, did not feature a transitional or savings clause.   In other words, the old statutes governing the laws of apportionment were now gone.  What did that mean for pending cases?

Looking at the cases below, note that they do not mention the ability to relitigate causation. They talk about other, later issues in a case (apportionment of PD and vocational rehabilitation) and do not address the issue of being able to question industrial causation anew. We are not aware of any cases that do so.

In the matter of Rio Linda Union School District v. WCAB (Scheftner) (2005) 131 Cal. App. 4th 517, the California Court of Appeal specifically addressed the question of what happens to a case that was submitted for decision before the April 19, 2004 effective date of SB 899, but where the Findings and Award was issued after the effective date (in that case on April 23, 2004).  In Scheftner, a trial took place at the Sacramento WCAB on February 18, 2004.  The matter was submitted for decision on March 2, 2004 – just one month prior to the passage of Governor Schwarzenegger’s emergency legislation.  The trial judge’s decision followed the apportionment determination pursuant to the old Labor Code sections 4663 and 4750.  Defendants filed an appeal, and the Workers’ Compensation Judge issued a report and recommendation claiming the new section 4663 was not applicable because the matter had been tried and submitted before the effective date of SB 899.  The WCAB agreed with the trial judge on reconsideration, indicating the case had already been submitted with discovery closed; therefore, the new law should not apply.

The Court of Appeal reversed the WCAB’s determination.  In its decision, the Court of Appeal stated California’s workers’ compensation laws are wholly statutory and are not derived from common law.  Because SB 899 repealed and replaced  the former statutes governing apportionment, it was clear the legislature intended to substitute a new statutory framework.  SB 899 did not include any kind of saving clause with respect to the old laws on apportionment.  The Court of Appeal plainly and directly stated:

The unconditional repeal of a special remedial statute without a saving clause stops all pending actions where the repeal finds them.  If final relief has not been granted before the repeal goes into effect it cannot be granted afterwards, even if a judgment has been entered and the cause is pending on appeal.  The reviewing court must dispose of the case under the law in force when its decision is rendered. (Scheftner at 528).

The Court further stated:

The repeal of such statutory right applies to all pending cases, at whatever state the repeal finds them, unless the legislature has expressed a contrary intent by an express saving clause or by implication from contemporaneous legislation.  (Scheftner at 529).

That language and the viewpoint expressed certainly seems definitive.

Another example can be found in the matter of Beverly Hilton Hotel v. Workers’ Compensation Appeals Board (Boganim) (2009) 74 CCC 927.  Boganim similarly dealt with the issue of the impact of a repealed statute, in this case, the sunset provision of vocational rehabilitation.  In Boganim, the applicant had suffered two compensable injuries, a specific occurring in September of 1990 and a cumulative injury through November, 1991.  In March of 2004, the applicant requested vocational rehabilitation services pursuant to the now former LC 139.5.  After a series of proceedings before the rehabilitation unit, the applicant was awarded vocational rehabilitation services including vocational rehabilitation maintenance allowance at the temporary disability rate pursuant to former sections 4642 and 139.5.  The WCJ issued an opinion on January 31, 2008 that was affirmed by the WCAB on reconsideration on October 7, 2008.  Defendants filed a petition for writ of review that was addressed in 2009.  Of course, those who were practicing at that time may recall provision of vocational rehabilitation benefits under LC 139.5 was due to sunset as of January 1, 2009.

That Court of Appeal addressed the entitlement to vocational rehabilitation benefits, succinctly stating:

Applicants had rights to vocational rehabilitation awards up to January 1, 2009.  After that, there were no such statutory rights available as to claims that were not vested by that date.  Thus, neither the board nor this court has jurisdiction to award such rights.  The court has no power to make orders which are not authorized by statute. (Boganim at 937).

The court also stated there was no indication, express or implied, in any legislation passed in which section 139.5 was repealed, that it intended to save vocational rehabilitation rights or remedies on or after January 1, 2009 for any injury dates (Boganim at 934).

Was there a Savings Clause in the Covid Statutes?

The obvious question is, in repealing the covid presumption statutes, was there any kind of savings clause to speak of?  Had there been a savings clause, what language would have been used?

The legislature certainly could have stated the presumptions afforded by SB 1163 are retained for any and all pending actions instituted before January 1, 2024 that might otherwise be affected by the repeal of this statute–or perhaps, that any provisions of SB 1163 are preserved despite any subsequent amendments or repeal of the former law.  Recall the legislature specifically extended the original covid presumption statutes with AB 1751.  That piece of legislation could easily have stated that any existing rights in pending legal proceedings will be preserved when the repeal takes effect as of January 1, 2024.  The legislature could have also simply stated the repeal applies only prospectively to dates of injury after January 1, 2024.  However, the legislature did not do so.  Does this seem equitable to those who contracted Covid-19 at work prior to 2024 and were afforded the presumption?  It does not appear to. The fact that the initial bill specifically suggested the presumption extend to 1/1/25 in AB 1751, then reduced it to 1/1/24, however, suggests clear intent that the legislature wanted to put an end to the application of the Covid presumptions as expeditiously as possible.

Simply put, there was no saving clause.  The statutes have been repealed. The courts may not award benefits in a system based on statutory construction where the statutes no longer exist.

But again, what is the effect of that learned point of statutory interpretation?

What if Defendant Accepted a Pending Case Based Solely on the Presumption That No Longer Exists?

Many Covid-19 workers’ compensation cases have been accepted based solely on the presumption.  While most such claims probably pertained to LC 3212.87 (front-line workers/first responders), certainly other employers accepted cases based on the occurrence of an outbreak as well.  What, if anything, could an employer do now if that were the case?

Keep in mind that where the presumption no longer exists, Labor Code section 3202.5’s “more likely than not” standard now applies.  And so does the Labor Code section 5402 90-day presumption statute.  In other words, where liability has not been rejected within 90 days after the claim form is filed, the injury shall be presumed compensable (emphasis added).

Labor Code section 5402 allows the presumption to be rebutted only by evidence discoverable subsequent to the 90-day period.  Labor Code section 4909 clearly states that any payment or benefit received by the injured employee “shall not, in the absence of any agreement, be an admission of liability for compensation on the part of the employer.” Could an employer contend it was precluded from investigating the case on causation grounds since the presumption statute prevented any reasonable efforts to conduct an investigation?  Perhaps.  But we have been dealing with a rebuttable presumption in the former Covid statutes and the employer might have investigated the case, though the investigation time would have been shorter.  Also, we are still dealing with employees whom we recognize were subject to a greater risk of exposure in the first place — the point being, we have a front-line worker who contracted Covid-19.  We were discouraged from engaging in an investigation by the presumption statute.  Should we now be afforded the opportunity to do so?  The argument may be compelling to some, but keep in mind we still need to get over the hurdle of the practical effect of the effort. Take, for example, a front-line worker who was involved in direct patient care, or a police officer or firefighter who was involved with the general public, who contracted Covid-19; is it more likely than not that the employee contracted the condition at work?  If we are arguing causation in a 3212.88 situation where we had an outbreak, isn’t it still more likely that the employee contracted it at work when he or she was working with others who also tested positive?   But what if the employee was the first one to test positive?  Was it not more likely that the employee brought it to work in the first place, and infected the others?  Keep in mind, per LC 3212.88, the employer still had the right to investigate evidence of efforts at mitigation by the employer along with non-occupational risk factors for the employee, but that should have been done in the investigative period, although shortened.

The Practical Effect of the Repeal:

If a pre-2024 claim was denied, despite the presumption statutes, it is certainly clear – there is no presumption with respect to Covid-19 going forward, presuming the claim is still pending. The same is obviously true for any Covid claims occurring on or after January 1, 2024.

If the claim was accepted based on the statute, and benefits have been furnished, that claim is likely still accepted if more than 90 days have passed since the return of the claim form pursuant to Labor Code section 5402.  There may be an equitable argument for an employer, but then again, wasn’t equity on the side of the employee in the first place?  After all, the emergency statutes were passed in the fall of 2020 during the Covid pandemic and were designed specifically to protect infected workers.  As courts have long held, we are not allowed to second-guess the apparent policy decision of the Legislature, in addressing a crisis. (Neighbours v. Buzz Oates Enterprises (1990) 217 Cal.App.3d 325, 334).  Similarly, it is not up to us to determine why the legislature did not include a saving clause in a particular repealing statute.  As the court stated in Neighbours,  “it is for the Legislature, not the courts, to pass upon the social wisdom of such an enactment.”

A court confronted with the issue of the extent Covid-19 presumptions still might exist in part after January 1, 2024, might look for a clue from the language in Scheftner that a statutory repeal with a saving clause “stops all pending actions where the appeal finds them (emphasis added).”

If a pre-2024 covid claim was accepted before the repeal of the statutes, any issue you may later be litigating cannot include a replaying of the causation issue which is part of the “found” status of the case at the time the presumptions died.

Going forward, employees infected with Covid-19 will no longer have the benefit of a presumption, even if the case is still pending.  As indicated, though, they may still prove compensability per LC 3202.5 – was it more likely than not that the employee contracted it at work?  With most employees having resumed normal social lives, and the concept of social distancing becoming a foggy remnant of the past, it will certainly be difficult for someone to suggest it was more likely than not that they contracted the disease at work, as opposed to home or elsewhere.  They will now have to prove it.

Written By:

John V. Geyer, Esq. of our LFLM – Sacramento Office and LFLM-Oakland/Concord Office

Laughlin, Falbo, Levy & Moresi, LLP.