Workers’ Compensation Liability for COVID-19 Claims in California (SB-1159)

Last Updated on November 24, 2020 by bigfish-admin

In September, the California legislature passed SB 1159, which evolves the framework for workers’ compensation claims related to COVID-19. As emergency legislation, this bill takes effect immediately. SB 1159 states that from July 6, 2020 through January 1, 2023, a ‘disputable presumption’ exists for an employee who suffers illness or death resulting from COVID-19. Presumably, if an employee suffers illness or death resulting from COVID-19 after January 1, 2023, the presumption no longer applies, and the case will be treated under the traditional workers’ compensation framework. 

SB 1159 creates a presumption that an illness or death resulting from COVID-19 has arisen out of and in the course and scope of employment. However, this presumption is still disputable by the employer. An employer may dispute the presumption with the following evidence: 

  • Measures in place to reduce potential transmission of COVID-19 in the employee’s place of employment.
  • The employee’s non-occupational risks of COVID-19 infection.
  • Statements made by the employee.
  • Any other evidence normally used to dispute a work-related injury.

The employer and claims administrator must quickly gather evidence to dispute the presumption. If the injury date occurred before July 6, 2020, the claims administration has 30 days to deny the claim. If the injury date falls on or after July 6, 2020, the claims administrator must deny the claim within 45 days, or the injury is presumed compensable. The presumption of compensability is rebuttable if evidence is discovered after the applicable investigation period. One exception to the rule: If the employee is considered an “essential employee” as outlined in Labor Code Section 3212.87, the 30-day denial period applies, regardless of the injury date. 


The presumption created by SB 1159 applies to any employees who test positive during an outbreak (as outlined below) at their specific place of employment, provided the employer has five or more employees. The presumption applies only to cases of illness or death resulting from COVID-19. Additionally, the following conditions must be present for the presumption to apply: 

  • Within 14 days of performing labor or services at the employer’s direction and at the employee’s place of employment, the employee tests positive for COVID-19.
  • The last date on which the above occurred before the employee tested positive for COVID-19 was on July 6, 2020 or later. 
  • The employee’s positive test occurred during a period of an outbreak at the employee’s specific place of employment. 

Under SB 1159, a “specific place of employment” excludes the employee’s home or residence, unless the employee performs home health care services at a home or residence. A “specific place of employment” includes a “building, store, facility, or agricultural field where an employee performs work at the employer’s direction.” 


If the presumption applies, the employee is entitled to “full hospital, surgical, medical treatment, disability indemnity, and death benefits.” However, the Department of Industrial Relations has waived entitlement to any death benefits under Labor Code Section 4706.5 if the deceased employee did not have any dependents. 

Entitlement to temporary disability benefits according to SB 1159 is similar to the entitlement guidelines outlined in the May 6 executive order. SB 1159 states that if any employee is eligible for paid sick leave benefits that are “specifically available in response to COVID-19,” such as those available under FFCRA, these benefits must be used and exhausted prior to accessing any temporary disability benefits without the traditional three-day waiting period. Eligibility for temporary disability benefits related to a COVID-19 illness or injury claim will depend on the date the employee tested positive for or was diagnosed with COVID-19. 

If the employee tests positive for or is diagnosed with COVID-19 on May 6, 2020 or later, the employee must be certified for temporary disability by a licensed physician within the first 15 days after the initial diagnosis, and must be recertified every 15 days for the first 45 days after the initial diagnosis. If the employee tests positive for or is diagnosed with COVID-19 before May 6, 2020, the employee must have obtained certification by May 21, 2020 documenting the period for which the employee was temporarily disabled and unable to work, and must have been recertified for temporary disability every 15 days for the first 45 days after the initial diagnosis.


SB 1159 also outlines new reporting requirements for employers, effective immediately. When an employer “knows or reasonably should know that an employee has tested positive for COVID-19” the employer must report the following to its workers’ compensation claims administrator within three business days: 

  • An employee has tested positive for COVID-19. The employer shall 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 claim form, pursuant to Labor Code Section 5401. 
  • The date the employee tested positive. This is the date on which the specimen was collected for testing, not the date on which the employee received the test result. 
  • The address or addresses of the employee’s specific place(s) of employment during the 14-day period prior to the date of the employee’s positive test. 
  • The highest number of employees who reported to work at the above location(s) in the 45-day period prior to the last day the employee worked at each specific place of employment.

There are separate reporting requirements for positive tests between July 6, 2020 and September 17, 2020. If an employer is aware of any employee who has tested positive during this period, the employer must report the information outlined in the first three bullet points above (via email or fax) to its claims administrator within 30 business days of September 17, 2020. However, instead of following the instructions in the fourth bullet point, the employer must report the highest number of employees who reported to work at each of the employee’s specific places of employment on any work date between July 6, 2020 and September 17, 2020. 

The claims administrator will use the information above to determine whether an outbreak has occurred. Following these reporting requirements is crucial, as SB 1159 applies a penalty of $10,000 to an employer that “intentionally submits false or misleading information, or fails to submit information at all.” 


Under Labor Code Section 3212.88, an outbreak exists if, within 14 calendar days, one of the following occurs at a specific place of employment:

  • The employer has up to 100 employees, and four of the employees test positive for COVID-19. 
  • The employer has more than 100 employees, and 4% of the employees test positive for COVID-19. 
  • The specific place of employment is ordered to close by a local public health department, the State Department of Public Health, the Division of Occupational Safety and Health, or a school superintendent due to a risk of COVID-19 infection. 

If there has been an outbreak, then the presumption of compensability applies. Note that, for the presumption to apply, the employee must test positive during an outbreak. This means that, if there is no outbreak, there is no presumption of coverage. 

As with the governor’s prior executive orders, this legislation should provide yet another incentive for employers to follow guidelines and take all reasonable steps to keep their workforce safe and healthy as the state of California continues the process of reopening. 

Big Fish will continue to report on further developments to this law and other paid leave laws nationwide. Information contained in this publication is intended for educational or informational purposes only and does not constitute legal advice or opinion, nor is this a substitute for the professional judgment of an attorney. 

Leave a Reply