Opinion Mondays: 30 Days into California's COVID-19 Executive Order, Questions Abound

As the nation moves, with fits and starts, toward some sort of recovery from the COVID-19 crisis, many within the workers’ compensation system are still trying to digest significant changes in the legal landscape in some states’ treatment of communicable disease claims. In former times, such claims, where the underlying disease was widely present in the general population, were almost never compensable. Now, however, thanks to executive orders issued by a number of state governors and legislation enacted in a number of other states, some employees in some states are poised to enjoy special presumptions of compensability as to their COVID-19 workers’ compensation claims. It’s been almost 30 days since California Governor Gavin Newsom issued his particular brand of presumptions proclamation. Questions abound, particularly one at the core of the discussion: Do state governors really have the power to amend workers’ compensation laws?

California Executive Order N-62-20

Because the California scenario affects so many employees and employers, Governor Gavin Newsom’s Executive Order N-62-20, signed on May 6, 2020, is ripe for examination. A quick overview: Executive Order N-62-20 creates a rebuttable presumption that an employee who tests positive for COVID-19 contracted it within the course and scope of employment for purposes of workers compensation if the employee tests positive within 14 days after performing labor or services at the place of employment and at the employer’s direction. Additionally,

• The day of performing labor must have occurred on or after March 19, 2020.
• There is no presumption if the labor was performed at the employee’s residence.
• The presumption remains in place for 60 days following the Order, or until July 5, 2020.

California’s Emergency Services Act

According to several California colleagues, the Governor’s power to push forward the special proclamation derives from the state’s Emergency Services Act, which gives California’s governor broad emergency authority. After declaring an emergency — Newsom did so March 4, 2020 — a governor may disregard statutory law to direct state resources in responding to the crisis. The Act raises some separation of powers concerns, but Golden State legislators have in the past, as in the present, proved quite pliable.

Newsom’s Executive Order essentially reverses the burden of proof for COVID-19 claims that meet the stated criteria. This begs the question: How does temporarily altering the compensability of some claims help the governor fight the virus and its effects?

Directing State Resources?

As noted above, California’s governor has broad emergency powers to direct state resources to meet the state’s needs in a crisis. I’m a bit slow on the draw here, but what state resources are being directed by the governor’s modifications of state workers’ compensation law? That isn’t, by the way, a rhetorical question. The legitimacy of the Executive Order depends upon its appropriate answer. It seems that the governor is directing private resources — to-wit, cash from workers’ compensation carriers and self-insured employers — to private individuals: i.e., some who have claims.

The Order is Only Temporary

I know, I know. It’s an emergency, and during an emergency, temporary strong-arm tactics are a necessary evil. Indeed, according to Newsom’s proclamation, the whole thing will end July 5 (a governor can hardly declare that an “emergency” lasts forever; it stops being an emergency and becomes the norm). That argument cuts both ways, does it not? Since the effects of the order are so short-lived, will not the benefits of the order also be temporary? Then, to what gain? “I can change the rules, if I only do so temporarily.” Is that the new rule?

To the extent that the Newsom’s design was to give the state sufficient time for the California legislature to act, where is the action? According to public news sources, both houses have been in session in Sacramento since early May. Half of the 60-day period of time has expired and I’m not aware of any legislation that will pick up the baton when it is dropped on July 5.

Three Classes of COVID-19 Victims

Assuming Governor Newsom had the legitimate power to issue his Executive Order creating the temporary presumption of compensability, which, as noted above, is subject to debate, the proclamation’s effect is to create at least three classes of workers:

• “Essential workers”, whose claims arise between March 19, 2020 and July 5, 2020;
• “Non-essential workers” (i.e., those who work at home), whose claims also arise between March 19, 2020 and July 5, 2020;
• Claims by both essential and non-essential workers whose claims arise from exposure before March 19, 2020, or after July 5, 2020.

Is Such Disparate Treatment Constitutionally Viable?

What is the justification for differentiating between these categories of California workers? Does such a differentiation help the governor fight the virus? If so, how? What the governor has done is create a lottery of sorts. If a certain class of employee contracts the virus within a short time span — all evidence appears to indicate that we will be fighting the virus for months, if not years, to come — then he or she is able to saddle the employer of proving that the exposure was not related to the employment. If, however, one “catches the bug” outside the time frame, or outside the special “zone of protection” afforded by the executive order, the burden is upon the claimant.

How is Such Disparate Treatment Effective in Fighting the Virus?

How does reversing the burden of proof for some claims, but not others, help in the fight against COVID-19? Again, that isn’t a rhetorical question since the governor’s justification for his executive order is hinged upon it. Assuming the governor (and/or others) can answer that question positively, then to the extent that reversing the burden of proof is effective in fighting the virus, why not reverse it for everyone and, for that matter, for every disease or condition? We’re back to a mantra that I repeat from time to time, “All employees are equal, but some are more equal than others.”

Same Questions Relate to Other States

I’m not trying to pick on California’s governor here. I have the same questions for the governors and legislators in Kentucky, Missouri, and North Dakota (I’m writing from memory here; there may be others). I have the same questions for legislatures in Minnesota, Wisconsin, and Utah, who crafted special presumptions favoring some “front-line” workers — typically those with political clout — all the while ignoring others, who have no such clout of their own.

How are these orders and legislation helping in the fight against COVID-19? Isn’t most of this gubernatorial and legislative action a not-so-feigned effort to help all the usual suspects? Many of my friends long for a day when things can get back to normal. I hope that our “new normal” doesn’t include such flagrant preferences for some employees over others.