Laid Off as a Result of the COVID-19 Pandemic?

A non-essential employer will no longer be able to offer modified work to an injured worker if the employer closes business and lays off the staff due to the COVID-19 pandemic. Pursuant to the reasoning in Manpower Temporary Services v. Workers’ Compensation Appeals Board (Rodriguez), the injured worker may be entitled to temporary disability indemnity if the business’s closure due to the COVID-19 pandemic is not considered “good cause” for the layoff. However, the Board in Signature Fruit Co. v. Worker's Compensation Appeals Board (Ochoa) found that “the essential purpose of temporary disability indemnity is to help replace the wages the employee would have earned, but for the injury, during his or her period(s) of temporary disability.” The employer will argue that the laid off, disabled worker is not losing wages due to the work-related injury but as a result of the pandemic, which does not entitle him or her to temporary disability benefits.

Due to the current novelty of the workers’ compensation issues arising from the outbreak of COVID-19, we will have to wait and see how courts rule on the issue of temporary disability following layoff in the absence of any specific case precedent addressing it.

About Workers Compensation Law:

Workers’ Compensation Law is an administrative, fair system for both parties that does not consider the fault of the injured worker when determining compensability of the injury in exchange for fixed, ascertainable liability for the employer. When an employee sustains an injury in the workplace, he or she is required to timely report the injury to his or her employer within thirty (30) after the date of injury pursuant to Labor Code Section 5400. If an employee fails to timely report his or her work-related injury, no claim for workers’ compensation shall be maintained. Pursuant to Labor Code Section 5405, the Application for Adjudication of a Claim must be filed with the Workers’ Compensation Appeals Board within one (1) year from the date of injury or last date of benefits, including medical treatment, whichever is later. If it is not filed within this time period, the Application is barred by the Statute of Limitations. However, the filing of a DWC-1 Claim Form with the employer tolls the Statute of Limitations. 

All California employers must be able to provide workers’ compensation benefits to their employees. Under Labor Code Section 3700, employers with one or more non-family member employees are required to have workers’ compensation insurance in California. The workers’ compensation benefits that may be provided are the following: medical care, temporary disability benefits, permanent disability benefits, a supplemental job displacement benefit voucher and death benefits.

• Medical Care: the injured worker may be entitled to reasonable medical treatment to cure or relieve the work-related injury and/or illness. The treatment must follow the medical treatment utilization schedule guidelines. It is illegal for a physician or medical facility to bill an injured worker if they know it is a work-related injury.
• Temporary Disability Benefits: If the injured worker loses wages due to being unable to perform his or her usual and customary job duties as a result of the injury, the injured worker may be entitled to temporary disability benefits. Temporary disability benefits are two-thirds of the gross (pre-tax) weekly wages the injured worker is losing while recovering from a work-related injury. The benefits are limited to the maximum weekly amount set by law.
• Permanent Disability Benefits: If the injured worker does not fully recover from his or her injury, he or she may be entitled to permanent disability benefits even if released back to work. Permanent disability is any lasting disability from the work injury or illness that affects the injured worker’s ability to earn a living.
• Supplemental Job Displacement Benefit Voucher: If an employee is a Qualified Injured Worker and does not recover from his or her injury nor return to work, he or she may be entitled to a supplemental job displacement benefit voucher that pays for retraining or skill enhancement.
• Death Benefits: If the injured worker dies from the work-related injury or illness, his or her children or other dependents would be entitled to death benefits. Pursuant to Labor Code Section 5406, the injured worker’s dependents have one (1) year from the date of the injured worker’s death and two hundred forty (240) weeks from the date of the injury to file an Application for death benefits. 

Pursuant to Labor Code Section 3700.5, failure to have workers’ compensation coverage is a misdemeanor punishable by either a fine of no less than $10,000.00 or imprisonment in the county jail for up to one (1) year.

We will aggressively defend the uninsured employer, insured employer, insurance carrier, third-party administrator or zealously advocate for the injured worker in a workers’ compensation claim.