Workers Comp Zone


Are we entering so-called “black swan” times? If a pandemic of the COVID-19 is about to crest in the U.S., what might it mean for California workers’ comp?

Reduced economic activity and a general sense of panic may surely result, but the breadth, length and severity of the spread make it impossible to predict at this point. Nevertheless, it seems prudent to make some commentary on events that could unfold. So let’s look at it from several possible angles.

First, claims. We might see an increase in claims filed by workers who allege industrial exposure to the virus. Obviously this might include medical personnel but could also include individuals who labor in workplaces with significant public contact such as transportation, theme parks, restaurants, entertainment, public entity offices, schools and the like.

The issues are somewhat different for coronavirus, but the workers’ comp cases involving valley fever (human coccidioidomycosis) may have some relevance. An excellent article on the valley fever cases was just published in the California Workers’ Compensation Quarterly, a publication of the workers compensation section of the California Lawyers Association. The article, written by L.A. based Haight, Brown and Bonesteel lawyers (Shannon Blair, Theodore Penny and Elizabeth Epstein), notes that :

“In recent cases, the WCAB has held that industrial causation is met if the employee’s risk of contracting valley fever from employment is medically probably or materially greater than from the general public.”

Cases cited in the article include Ranulfo Cruz v. Hall Management 2019 Cal.Wrk.Comp. P.D.LEXIS 29 and Tim Abernathy v. Harris Wolf California Almonds, 2015 Cal.Wrk.Comp.P.D. LEXIS 547 and the subsequent panel decision in Abernathy, 2017 Cal.Wrk.Comp.P.D.LEXIS 231.

If there are widespread serious coronavirus infections it will not be surprising to see an uptick in these claims. How the system deals with them will be very fact dependent.

Second, potential impact on the system itself.

I was practicing in Oakland during the Loma Prieta earthquake. There was some disruption, as the Oakland WCAB district office was no longer structurally habitable and other space had to be secured. More recently, operations at some WCAB offices were affected by the mega-wildfires.

But the California system has never had sustained shutdown. 

Recent images of Wuhan, Beijing and Shanghai and some recent reports on Milan show the impact that can occur if a whole city or region is under quarantine or essentially shut down in fear.

Now is probably a good time for California workers’ comp stakeholders to consider how a sustained severe epidemic (or a severely damaging earthquake) might affect their operations.

Whether we are talking attorneys, claims staff, WCAB staff, or workers’ comp medical providers, all might have severe challenges if there was a sustained Wuhan-type shutdown. How might it affect their workforce and transportation of the workforce to their office? How dependent are they on outside vendors and stakeholders who might be disrupted? If it was a sustained shutdown, how would workers (and injured workers) be paid?

Stakeholders might want to be considering whether there are ways to distribute work remotely or other countermeasures that could maintain some workflow in the event of a sustained period of uncertainty. Are there “workarounds”? How robust is your IT system and are there any tech options that might help mitigate sustained interruptions? If your clients and vendors are severely affected, how would that affect you?

Large organizations may have contingency planning for these sorts of things. But I suspect that most workers’ comp stakeholders don’t.

Let us hope that these sort of “black swan” scenarios don’t come to pass.

Be well.

Julius Young