Now that the California Legislature has dealt with the 2020- 2021 budget (at least for the time being), it is taking up measures to deal with the state’s response to the COVID-19 pandemic. As usual, much of the burden is likely to fall on employers. 

Two costly bills delve into two entirely different and usually contentious topics: paid family leave and workers’ compensation.

SB 1159 Background

SB 1159, the workers’ comp measure, passed through the upper chamber on a 28-11 vote. It is working its way through the Assembly’s committees. SB 1159 takes up “presumption” and is a followup to Governor Gavin Newsome’s executive order (N62-20) on the topic which expired last month.

Originally designed to cover only first responders and medical workers, this bill expanded its scope to every worker other than those working from home. Employers can “rebut” the workers’ comp claim within 30 days of the filing based on documented negative answers to the following standards:

  • Work was performed at employee’s “place of employment (other than at home) at the employer’s direction” on or after March 19, 2020, and on or before July 5, 2020; 
  • Astate-licensed physician supplied the diagnosis, and confirmed by testing within 30 days;
  • Where an employee has sick leave, they exhausted it before seeking state aid. 

The Senate Legislative Analyst reported the Workers’ Compensation Insurance Rating Bureau (WCIRB) estimates the bill costs between $2.2 and $33.6 billion, with the most likely figure being around $11.2 billion, paid by employers/insurers. 

All About AB 196

State-mandated paid family leave (PLF), enacted in 2002, expanded the State Disability Insurance (SDI) program, funded by payroll tax deductions. The most recent numbers for the program (2018), show nearly 90 percent of the claims filed were to take time off to bond with a newborn child.

That may change in the shadow of COVID-19. AB 196 extends the coverage of paid family leave in terms of time away from work and the amount of money given to employees who exercise the plan. This bill guarantees one hundred percent wage replacement up to the PFL program’s maximum weekly benefit amount. 

The Assembly Appropriations Committee, predicts an increased cost of $350 million in 2020 and up to $850 million by 2024, paid for by increase SDI taxes. 

The bill passed the California State Assembly on Thursday, May 24, with a vote of 66-7. It is currently running the gauntlet of Senate committees and has been amended at least once at press time.

 

By Ray Baca Executive Director Email: [email protected]