COVID 19, Imminent Hazard to Employees, Closure, and Notice

On September 17, 2020, California Governor Gavin Newsom signed legislation (AB 685) authorizing the California Division of Occupational Safety and Health (division) to mandate the closure of, and prohibiting entry to, a workplace where the exposure to COVID-19 is an imminent hazard to employees. Closure is limited to immediate area where the imminent hazard exists. The division will provide an employer with a closure notice that it must conspicuously post in the workplace and only the division can remove it when the workplace is safe with the required safeguards in place. However, workplace entry is permitted, so long as with the division’s knowledge and permission, to eliminate the dangerous conditions. This COVID-19 imminent hazard provision is repealed on January 1, 2023.

Employers that receive a notice of potential COVID-19 exposure must notify their employees (including subcontracted employees and exclusive representatives) within one day that they may have been exposed to COVID-19. Employers must also provide these employees with information regarding COVID-19-related benefits and options, along with its federal Centers for Disease Control compliant disinfection and safety plan. These notice requirements do not apply to employees who, as part of their duties, conduct COVID-19 testing or screening or provide direct patient care or treatment to individuals who are known to have tested positive for COVID-19, are persons under investigation, or are in quarantine or isolation related to COVID-19, unless they are an employee at the same worksite. Employers must maintain records of these notifications for at least three years.

Additionally, and within 48 hours, employers that are notified of a COVID-19 outbreak must report this information to the public health agency in their workplace’s jurisdiction and must continue to give notice to the local health department of any subsequent laboratory-confirmed cases of COVID-19 at its worksite. Employers may not retaliate against a worker for disclosing a positive COVID-19 test or diagnosis or order to quarantine or isolate.

The law is effective September 17, 2020.

Critical Workers, COVID-19, and Workers’ Compensation

On September 17, 2020, California Governor Gavin Newsom signed legislation (SB 1159) expanding access to workers’ compensation by defining an injury under the law to include a COVID-19 related illness or death when police officers, firefighters, and healthcare workers were on the job, on or after March 19, 2020 and on or before July 5, 2020, and tested positive for, or were diagnosed with, COVID-19 within 14 days thereafter. This injury, which is presumed to arise out of and in the course of employment, is compensated with full hospital, surgical, medical treatment, disability indemnity, and death benefits.

The law also provides the same definition of injury (and thus medical care and wage replacement benefits) for workers of employers with five or more employees (there’s no requirement that they be critical workers) when they test positive due to a workplace COVID-19 outbreak if within 14 calendar days:

• Four employees test positive for COVID-19 and the employer has 100 or fewer employees at a specific workplace;
• Four percent of the employees, who reported to the specific workplace, test positive for COVID-19 and the employer has more than 100 employees at that specific location.
• A local public health department, the State Department of Public Health, the Division of Occupational Safety and Health, or a school superintendent orders a specific workplace to close because of a COVID-19 infection risk.

Employees must exhaust their COVID-19 specific paid sick leave benefits before receiving any temporary disability or workers’ compensation benefits. There is no waiting period for temporary disability benefits and employees must satisfy either of the following to qualify for them:

• If they tested positive or were diagnosed with COVID-19 on or after May 6, 2020, they must be certified for temporary disability within the first 15 days after the initial diagnosis, and must be recertified for temporary disability every 15 days thereafter, for the first 45 days following diagnosis.
• If they tested positive or were diagnosed with COVID-19 before May 6, 2020, they must have obtained a certification, no later than May 21, 2020, documenting the period they were temporarily disabled and unable to work, and must be recertified for temporary disability every 15 days thereafter, for the first 45 days following diagnosis.

The law also requires that employers notify their claims administrator when it knows, or reasonably should know, that an employee tested positive for COVID-19. This written notice, sent via email or fax within three business days, must include all the following:

• Notice an employee has tested positive. Employers must not provide any personally identifiable information regarding the employee who tested positive for COVID-19 unless the employee asserts the infection is work related or has filed a workers’ compensation claim form.
• The date that the employee tests positive, which is the date the specimen was collected for testing.
• The specific address of the employee’s workplace during the 14-day period preceding the date of their positive test.
• The highest number of employees who reported to work at the employee’s specific workplace in the 45-day period preceding the last day the employee worked there.

The law took effect on September 17, 2020, and repeals on January 1, 2023.

Family Rights Act Expanded to Cover More Californians

On September 17, 2020, California Governor Gavin Newsom signed legislation (SB 1383) expanding the state’s Family Rights Act (CFRA) to cover Californians who work for an employer with five or more (previously 50 or more) employees to:

• Bond with a newborn;
• Care for a seriously ill family member;
• Address a military exigency; or
• Care for their own illness.

This aligns the employer size threshold under the CFRA with the employer size threshold in the state’s Pregnancy Disability Leave law. The law also requires an employer who employs both parents of a child to grant leave to each employee. 

The law is effective January 1, 2021.

Settlement Agreements in Employment Disputes

On September 11, 2020, California Governor Gavin Newsom signed legislation (AB 2143) regulating settlement agreements in employment disputes involving an aggrieved person and their employer. The law bars agreement provisions restricting the settling aggrieved person from future employment with the settling employer or any parent company, subsidiary, division, affiliate, or contractor of the employer. Any agreement made in violation of this protection on or after January 1, 2020, is void. However, the law does not:

• Preclude the employer and aggrieved person from making an agreement to:
  • End a current employment relationship; or
  • Prohibit or restrict the settling aggrieved person from future employment with the settling employer, if the employer made and documented a good faith determination, before the person filed their claim, that the person engaged in sexual harassment, sexual assault, or any criminal conduct.
• Require an employer to continue to employ or rehire a person if there is a legitimate non-discriminatory or non-retaliatory reason for their termination or refusal to rehire.

COVID-19 Supplemental Paid Sick Leave Expanded

On September 9, 2020, California Governor Gavin Newsom signed legislation (AB 1867) codifying Executive Order N-51-20, as detailed in our California Law Alerts - April 2020, which:

• Mandates that a food employee working in any food facility must be permitted to wash their hands every 30 minutes as needed; and
• Makes the COVID-19 food sector supplemental paid sick leave effective until December 31, 2020, or when any federal extension of the Emergency Paid Sick Leave Act (EPSLA) established by the Families First Coronavirus Response Act (FFCRA) expires, whichever occurs later.

The law also creates a new entitlement to COVID-19 supplemental paid sick leave for persons employed as health care providers or emergency responders. This new entitlement is also effective until December 31, 2020, or when any extension of the EPSLA expires, whichever occurs later. According to the Governor’s message, the law closes the gaps between paid sick days provided in federal law and the Governor's Executive Order. The law now includes employers with over 500 employees as well as all employers of first responders and health care employees who opted not to offer coverage under federal law. The Labor Commissioner can cite workplaces for a lack of paid sick days under the expanded law.

Read more on the Department of Industrial Relations FAQs page.

Independent Contractors and Worker Classification Exemptions

On September 4, 2020, California Governor Gavin Newsom signed legislation (AB 2257) expanding the exemptions to the state’s ABC test, which is used to determine whether an individual is an employee or an independent contractor (worker classification) under the California Labor Code, Unemployment Insurance code, and Industrial Welfare Commission wage orders.

Under the ABC test, paid workers must be classified as employees — not independent contractors — unless the hiring entity can demonstrate all of the following:

1. They are free from the control and direction of the hiring entity regarding the work they perform, in practice and under their contract (e.g., they make their own schedule, do not answer to a supervisor, perform duties according to their own custom).
2. They perform work that is outside the usual course of the hiring entity’s business (e.g., they are a baker, but for a company that does not specialize in baking).
3. They are customarily engaged in an independently established trade, occupation, or business of the same nature as that of the work performed for the hiring entity (e.g., they mostly earn income by baking, and that’s exactly what they’re doing for the hiring entity).

Additionally, the law now exempts certain occupations from the ABC test and instead applies the multifactor Borello test (see question #5), which considers several independent factors in determining employment status. Workers exempt from ABC but considered under Borello include:

• Musicians or musical groups for single-engagement live performance events, under specific terms and conditions.
• Individual performance artists presenting original, creative work that is unique to only their invention, imagination, or talent.
• Still photographers, photojournalists, videographers, or photo editors under a written contract with specific terms along with the services they provide to digital content aggregators.
• Fine artists, freelance writers, translators, editors, content contributors, advisors, narrators, cartographers, producers, copy editors, illustrators, or newspaper cartoonists under a written contract with specific terms.
• People who provide underwriting inspections and other services for the insurance industry.
• Manufactured housing salespersons, subject to certain obligations.
• International exchange visitor program workers.
• Consultants providing substantive advice that requires their discretion and independent judgment, which is based on their own expertise of a particular subject or field of study.
• Animal services related to daytime and nighttime pet care including pet boarding.
• Competition judges with specialized skills.
• Licensed landscape architects.
• Specialized performers teaching master classes.
• Registered professional foresters.
• Real estate appraisers and home inspectors.
• Feedback aggregators.

The law also:

• Creates an exemption for business-to-business relationships between two or more sole proprietors. Instead, worker classification is determined by Cal. Labor Code § 2750.5 and by Borello.
• Revises referral agency exemption criteria and clarifies that referrals for services do not include high hazard industry services and janitorial, delivery, courier, transportation, trucking, agricultural labor, retail, logging, in-home care, or construction services other than minor home repair.

The ABC test and the Borello test both assume that the worker is an employee. The hiring entity must prove that the worker is an independent contractor to make that classification. Under the ABC test, if a hiring entity cannot demonstrate any part of the three-part test then the worker is not an independent contractor. Under the Borello test, no single factor determines whether a worker is an employee or an independent contractor. Instead, courts consider all potentially relevant factors on a case-by-case basis according to the nature of the work, the overall arrangement between the parties, and the purpose of the law. 

The law took effect September 4, 2020.