Business groups angered by Newsom order easing barriers to workers comp for COVID-19 patients

California business groups are fuming about an executive order Gov. Gavin Newsom handed down Wednesday that makes it easier for people to file for workers compensation if they contract COVID-19.

The order directs insurers carriers to approve workers compensation claims for COVID-19 with a presumption that the employee caught the coronavirus at work.

Employers can rebut the claim under “strict criteria,” Newsom said, but the presumption puts the burden on them to prove that the worker became infected someplace else.

The order is retroactive to March 19 and is scheduled to expire in 60 days.

The California Chamber of Commerce said in a statement the executive order will increase workers’ compensation insurance rates that will then “unnecessarily and significantly” harm employers.

“Imposing a legal presumption that any employee who contracts the coronavirus is covered by workers’ compensation benefits shifts the cost of this pandemic to employers,” the chamber said, adding that federal dollars should be used for assistance instead. “The private sector did not cause this crisis and it should not be the safety net used to pay for this crisis--that is the role of government.”

Unions and labor lobbyists have spent weeks pressuring the administration to offer greater financial safeguards for front-line workers like janitors, warehouse employees, first responders, nurses and farm laborers.

“It should provide some calm and relief to our health care workers who were otherwise scratching their heads wondering why they were not part of some of these original announcements,” Newsom said. “We want to keep workers healthy and keep them safe.”

Dozens of organizations, including labor powerhouses like the Service Employees International Union and the California Labor Federation, immediately applauded Newsom’s order.

“Gov. Newsom’s executive order is an important step toward showing each and every worker they are valued,” said April Verrett, president of SEIU Local 2015. “Whether they are caring for the sick or for our fragile aging and disabled populations, providing early education for the children of essential workers, or keeping our airports, hospitals and public spaces clean.”

Still, business representatives said the order hurts employers, many of whom are already struggling because of the state’s grounded economy..

California Business Roundtable President Rob Lapsley said in a statement that medical professionals like doctors and nurses and first responders should receive workers’ compensation.

But, he added, Newsom’s decision bypassed the Legislature’s approval and will make it more challenging for employers to rehire their laid-off workers once businesses can reopen.

“This will ultimately impact communities of color who are the foundation of small business employees and business owners in California,” Lapsley said.

The American Property Casualty Insurance Association added that Newsom’s order is “overly broad” and some employers could end up paying compensation for cases “not contracted in the workplace.”

This story was originally published May 7, 2020 at 6:15 AM.