Last year, the biggest development in employment law was Assembly Bill 5 (AB 5), the independent contractor bill that codified the “ABC Test” outlined by the California Supreme Court’s 2018 Dynamex decision and extended it to the Labor and Unemployment Insurance codes. While the bulk of the law went into effect January 1, 2020, one provision was delayed until July 1, 2020; on this date, the ABC Test will apply for purposes of workers’ compensation.
There are additional workers’ compensation developments for employers to keep an eye on, including bills similar to Governor Gavin Newsom’s Executive Order that expands workers’ compensation benefits by creating a rebuttable presumption that workers who test positive or are diagnosed with COVID-19 contracted the infection in the scope of employment.
While the order expires on July 5, 2020, the California Legislature has taken up the issue and introduced AB 664 and AB 196, both of which are currently on CalChamber’s Job Killer list. These bills would establish conclusive (not rebuttable) presumptions that certain workers who contract COVID-19 did so in the scope of employment, automatically making them eligible for workers’ compensation benefits. In the case of AB 664, eligible employees would also be entitled to non-worker’s compensation benefits, including reimbursement for emergency equipment or personal protective equipment (PPE), reasonable living expenses and temporary housing costs.
Both bills would substantially increase workers’ compensation costs, the burden of which will ultimately fall on California employers should they become law.