Legislative Updates

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All the employer is required to do is to report a positive test result and the carrier will determine whether an “outbreak” has occurred, thereby triggering the presumption of a workplace injury.

Reporting Requirements
Employers must provide written notification to their claim’s administrator in writing via electronic mail or facsimile within three business days and include the following information:
• An employee has tested positive.
• The date that the employee tested positive, which is the date the specimen was collected for testing.
• The specific address or addresses of the employee’s specific place of employment during the 14-day period preceding the date of the employee’s positive test.
• The highest number of employees who reported to work at the employee’s specific place of employment in the 45-day period preceding the last day the employee worked at each specific place of employment.

Civil Penalties for Non-Compliance
Under the new law, employers who fail to submit the required information or intentionally submit false or misleading information are subject to a civil penalty of up to $10,000, assessed by the Labor Commissioner.

Although the new law contains a presumption that an employee who tests positive contracted the virus at work, the burden to overcome the presumption is on the employer.

For example, the employer may dispute the presumption by presenting evidence of preventative measures taken by the employer to reduce transmission. The employer may also present evidence of the employee’s non-occupational risks of COVID-19 infection.

Good news for employers with remote workers—the presumption of COVID-19 workplace injury is not applicable to employees who don’t leave their place of residence to work unless the employee provides specific in-home health care services.

Close Contact
The definition of “close contact” is 15 minutes of cumulative time within 24 hours.
An employer should investigate as soon as they become aware of a positive test result to determine where the employee may have been exposed, who they have been in close contact with, and whether other employees were exposed or tested positive.

In addition, if an employee tests positive, the employer is obligated to provide written notice within one business day to other employees who were in close contact with that employee.

Since these laws are already in effect, employers may want to contact their workers’ compensation carrier to understand what their carrier requires so that they will be prepared with the information that their carrier needs to determine whether a positive test is going to be filed as a workers’ compensation claim.

Dynamex is Retroactive:  California Supreme Court’s Rejection of the Reasonable Reliance Exception Ignores Reality
As those who have been following AB 5 know well, in April 2018, the California Supreme Court issued a monumental decision related to independent contractor classification. Now, the court has held that the Dynamex decision is retroactive, opening up California businesses to millions of dollars of liability.
In Dynamex Operations West, Inc. v. Superior Court, the court held that whether a worker is an employee for purposes of the California Wage Orders is determined by the “ABC test”. Under the ABC test, a worker is presumed to be an employee unless the hiring entity establishes all three of the following conditions:

  • (A) The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.
  • (B) The person performs work that is outside the usual course of the hiring entity’s business.
  • (C) The person is customarily engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.

This Dynamex decision came as a large surprise to California businesses. For decades, California courts and state agencies had applied what is known as the Borello test for determining whether a worker was an independent contractor or employee for labor and employment purposes. The multi-factor test had been established in S.G. Borello & Sons, Inc. v Dept. of Industrial Relations in 1989 and looked primarily at whether the hiring entity had a “right to control” the manner in which the worker performed the contracted service.

Although Borello was technically not a Wage Order case, because the courts and California state agencies had relied on Borello to determine whether workers were properly classified for purposes of claims under the Wage Orders, any business seeking advice or guidance on this issue would be told to look to Borello and would have relied on that multi-factor test. Some businesses staked their entire business model on Borello and its wide acceptance by courts and state enforcement agencies as the applicable test for purposes of employment claims. Dynamex overturned decades of precedent in one fell swoop.

Now, employers have a second surprise — on January 14, 2021, the California Supreme Court held in Vazquez v. Jan-Pro Franchising International, Inc. that Dynamex is retroactive because the decision did not change any “settled rule” about what test applied to the Wage Orders and doing so is not “improper or unfair” to employers. The court explicitly rejected Jan-Pro’s argument that Dynamex should not be retroactive because it, and others, had reasonably relied on Borello in determining how to classify its workers, reasoning that employers had no reasonable basis for relying on Borello for Wage Order claims and claiming that Dynamex was not a “sharp” departure from the basic approach of Borello.

Even if the court is technically correct that Borello was not a Wage Order case, the court’s decision unfortunately does not reflect reality. Worse, it opens up businesses, that acted in good faith under the universally accepted Borello standard, to millions of dollars of exposure. The court’s Vazquez opinion states Dynamex applies retroactively to all cases “not yet final” as of the date of the Dynamex decision. Most claims for unpaid wages under the California Labor Code carry a three-year statute of limitations that can be extended to four years as long as the plaintiff also includes a claim under California’s Unfair Competition Law, plus the penalties that can be added to those claims under both the Labor Code and the Private Attorneys General Act. A business that relied in good faith on Borello can now be liable for not following the ABC test before the Dynamex decision was ever issued.

As for those that are exempted from Dynamex under AB 5, the Legislature should make it clear that the exemptions also apply retroactively. This would ensure that at least some businesses that reasonably relied on the once universally accepted Borello standard are spared from costly litigation.

COVID-19 Vaccine: Can It Be Required?
Cal Chamber
In this episode of The Workplace podcast, Cal Chamber Executive Vice President and General Counsel Erika Frank and employment law expert Jennifer Shaw discuss what employers need to consider before mandating that their employees get the COVID-19 vaccine.

The recent distribution of the COVID-19 vaccine has sparked a lot of questions from employers and many of them are asking whether employees can be required to get the vaccine, Frank tells podcast listeners.

Because the COVID-19 vaccine is so new, employers may find it helpful to put employees’ minds at ease and direct them to the Centers for Disease Control and Prevention (CDC) website so that they may learn more about the safety measures taken for developing the vaccine and how its efficacy is evaluated, Shaw suggests.

Even though the vaccine is available, Shaw adds, it’s clear that reaching herd immunity is going to be a slow process that may not be achieved until 2022. So, it’s very important that employers remain diligent about social distancing protocols, she stressed.

This podcast was recorded on January 12. Listeners should be aware that given the unpredictability of the COVID-19 pandemic, information shared on this podcast episode may change at any time.

Problems with Mandating the Vaccine
While it is tempting to require that all employees take the COVID-19 vaccine in order to show up for work, Shaw cautions that there are a number of problems which employers must consider.
First, there will be some employees who will have a legitimate reason why they cannot get the vaccine — either for religious reasons or due to medical conditions. These situations will require that the employer commence the interactive process and maintain proper documentation. All of this takes a lot of time, and if half of an employer’s workforce asks for a reasonable accommodation, it can be a tremendous undertaking, Shaw explains.

Second, if an employee were to have a reaction to the vaccine, the employer may be liable for workers’ compensation claims because the vaccine was required in order to show up to work.
Third, mandating the vaccine holds morale implications. Some employees may hold strong reservations and opinions regarding the safety of the COVID-19 vaccine and vaccines in general.
“Do you want to create the morale issue that you’re going to have by forcing unwilling people to get the vaccine? Now, obviously a mandatory vaccine program doesn’t mean you’re going to drag them down to the vaccine station kicking and screaming, but they have to choose between the vaccine and a job — that’s really what we’re asking them to choose when we are talking about a mandatory vaccine program. So, there are morale implications, there are employee relations implications,” she says.

The last issue to consider is how the vaccine would be administered. Is the employer going to do it? If so, there are all sorts of medical documentation that will be required, so the employer would need to bring in a third party, which increases costs, Shaw explains.

Currently, there is no mandate that employers provide COVID-19 vaccines, and California is still following a hierarchy as to who can receive the vaccine first. So, while this conversation may be a bit early, these are still important things to consider, Shaw says.

Vaccine Not ‘Medical Exam’
The U.S. Equal Employment Opportunity Commission (EEOC) has stated that administration of the COVID-19 vaccine does not constitute a “medical exam,” Frank says.

This opens up the ability for any employer to develop a mandated program provided they deal with the reasonable accommodation issues mentioned earlier, Shaw explains. While the EEOC is giving employers the green light, it also is requiring that a protocol be put in place, with required documentation and employee communication.

“So, it’s not something like ‘Oh, I think I’ll just run my team down to CVS and get them a mandated COVID-19 vaccine.’ It just doesn’t work that way,” she says
Employers should, however, encourage their employees to get the COVID-19 vaccine when it becomes available to them, similar to how employees are encouraged to get the flu vaccine during cold and flu season, Frank says.

If an employer, however, is thinking about making the COVID-19 vaccine a part of an incentive program, they should keep in mind that not all employees will be able to get the vaccine due to religious or medical reasons, Shaw points out. So, if an employer offers $25 to employees who get the vaccine, the employer should also offer the $25 to employees who cannot get the vaccine due to a legitimate health or religious reason.

As of this podcast recording, state agencies have yet to release guidance on COVID-19 vaccines in the workplace, so this is an evolving issue, Frank tells listeners.

Vaccine Coming Sooner Than Expected?
Cal Matters
This week, Gov. Gavin Newsom will unveil a pilot program to help counties, cities and other entities schedule vaccine appointments, Cal Matters has learned.

The move, which comes sooner than expected, underscores the state’s rush to streamline a chaotic rollout that has resulted in Californians developing their own online platforms to centralize and decipher a dizzying array of policies.

Newsom had previously disclosed plans to unveil a vaccine eligibility notification system this week, with the appointment system to follow in “a second phase.” But the governor will now launch both this week, Darrel Ng, senior communications adviser for the state’s COVID-19 vaccine task force, told me Wednesday. Counties, cities and other entities — such as mass vaccination sites — can choose whether to use the pilot appointment program. The appointments will be open only to eligible Californians and are dependent on the number of available doses.

The news comes amid a mixed vaccine picture for California. On Wednesday, state epidemiologist Dr. Erica Pan gave providers the go-ahead to resume using doses from a vaccine batch linked to a higher-than-usual number of severe allergic reactions. That will free up more than 330,000 doses, potentially allowing clinics that had closed after the batch was put on hold to reopen.

  • Pan: We “found no scientific basis to continue the pause. … These findings should continue to give Californians confidence that vaccines are safe and effective.”

Nevertheless, challenges remain. Pan said Wednesday it could take the state four to five months just to administer two doses of vaccine to Californians in the 65-and-older category. As of Tuesday, California had administered 37% of its 4.1 million doses. Only seven states have administered fewer doses per capita, according to the Centers for Disease Control and Prevention.
The state’s biggest hurdle, Pan said, is an inconsistent and scarce vaccine supply coming from the federal government — though officials hope that will change with the newly inaugurated Biden administration.

  • Ng: “The goal would be to have a predictable and high number of shots … because if you can tell us what it’ll be, we can plan for it.”

California Policy and Politics – A Primer on 2020-2021
Cal Matters

After a record 118 consecutive months of economic expansion, 2020 opened in California with the highest of hopes. “By any standard measure, by nearly every recognizable metric, the state of California is not just thriving but, in many instances, leading the country, inventing the future, and inspiring the nation,” Gov. Gavin Newsom said in his State of the State speech on Feb. 19.
Nineteen days later, with three deaths and 55 cases of COVID-19 reported in California, he declared a state of emergency. Shutdowns ended 2.6 million jobs in about two months and quadrupled the state’s historic low unemployment. In all, the state would record about 2 million cases of the virus and more than 22,000 deaths in 2020.

CalMatters journalists around the state spent that unforgettable year reading reports, following bills and talking to elected leaders, advocates, experts and those experiencing the problems and changes to life in California. In these pages we collect what we have learned and summarize California’s major developments in the tumultuous and historic year of 2020 and look at what’s ahead.  download this free, 53-page PDF file