California’s Division of Occupational Safety and Health (Cal/OSHA) recently issued Emergency Temporary Standards (Standards) intended to establish COVID-19 safety procedures in California workplaces. The Standards apply to all employees and workplaces in California except: (1) workplaces with only one employee who does not have contact with others; (2) employees working from home; and (3) employees covered under 8 C.C.R. § 5199 (related to facilities, service categories, or operations dealing with aerosol transmissible diseases).
Among various requirements, the Standards obligate employers to notify all potentially exposed employees within 24 hours of someone in the workplace testing positive for COVID-19. The Standards also establish minimum testing requirements for “outbreaks” (defined as three or more positive cases in a workplace within 14 days). If this occurs, all employees who were in the workplace during the outbreak must be tested twice: (1) immediately; and (2) one week later. After that, all employees who remain at the workplace must continue to be tested at least weekly until there are no more positive cases for a 14-day period. There are separate testing requirements under the Standards for “major outbreaks,” which is when there are 20 or more cases in a 30-day period. The Standards mandate that employers must provide testing at no cost to employees in the event of outbreaks at their worksites. Perhaps the most controversial aspect of the Standards is that they require employers to continue and maintain an employee’s earnings, seniority, and all other rights and benefits, including the employee’s right to their former job status, as if the employee had not been removed from their job when the employee is excluded from the workplace under the Standards (either because they tested positive for COVID-19 or because they were subject to “potential COVID-19 exposure”). Employers are allowed to use employer-provided employee sick leave benefits for this purpose and consider benefit payments from public sources in determining how to maintain earnings, rights and benefits, where permitted by law and when not covered by workers’ compensation.
On December 16, 2020, a group led by the National Retail Federation (NRF) and the National Federation of Independent Businesses filed a lawsuit in the Superior Court for the County of San Francisco, asking the court to enjoin the enforcement of the Cal/OSHA regulations and to declare that the regulations are unlawful under the Administrative Procedures Act, the California Occupational Safety and Health Act, and California’s constitution. The suit names Cal/OSHA, the Occupational Safety & Health Standards Board, and California Department of Industrial Relations Chief Douglas Parker as defendants. An initial status conference is set in the case for May 19, 2021.
The lawsuit alleges four causes of action. First, the complaint alleges that the Cal/OSHA Standards Board violated the Administrative Procedure Act by failing to provide concrete facts demonstrating the existence of an emergency. Specifically, the plaintiffs allege that despite the fact that the Standards Board was unable to find evidence that California workplaces were failing to comply with existing COVID-19 guidelines, the Board chose to implement the Standards in a piecemeal, emergency manner rather than through the regular, non-emergency avenues for rulemaking. Pointing to the absence of any scientific backing for the Standards, the plaintiffs contend Cal/OSHA and the Standards Board relied on “unsupported speculation that there is a nexus between reopening workplaces and the increase in COVID-19 cases.”
Second, the complaint claims Cal/OSHA violated the California Occupational Safety and Health Act by overstepping its jurisdiction, which is limited to establishing health and safety standards. The plaintiffs specifically challenge the requirement in the Cal/OSHA temporary Standards that employers pay for COVID-19 testing and provide exclusion pay and other benefits to affected employees. The lawsuit alleges that it is the domain of the Department of Labor Standards Enforcement and the Division of Workers’ Compensation to regulate medical care, disability payments, and other benefits provided to employees with job-related injuries and illnesses.
Third, the lawsuit alleges the Standards Board and Cal/OSHA violated the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution by denying employers a meaningful opportunity to respond to the proposed regulations and explain how they are flawed.
Finally, the complaint states that Cal/OSHA violated the California Constitution’s guarantee of “acquiring, possessing and protecting property” by requiring employers to exclude employees for lengthy periods of time and pay the costs associated with these exclusions. In this respect, the lawsuit points to labor shortages in the face of the new Cal/OSHA Standards, alleging that the emergency regulations are flawed to the extent they require employees to be excluded from the workplace for 14 days, even if they receive a negative test result (this is in conflict with updated Centers for Disease Control guidelines, which provide that quarantine can end after 7 days if there is a negative test and no symptoms are reported during daily monitoring). The plaintiff business groups also allege that the Standards impose unworkable testing requirements, which could cost individual employers millions of dollars. The complaint specifically provides that Cal/OSHA’s temporary Standard “apply equally to all employers, regardless of their size or the prevalence of cases for their specific industry, and despite the absence of a proven nexus between COVID-19 positivity rates and workplaces generally. Especially for small businesses, the obligation to comply with these mandates can be ruinous and poses a legitimate threat to their continued existence.”
Action Items for Employers
Although questions remain regarding whether Cal/OSHA is authorized to promulgate regulations pertaining to wages and sick pay, the Cal/OSHA’s emergency Standards are still in effect and the testing and exclusion pay requirements under the Standards continue to apply. It is recommended that employers seek advice of counsel to determine areas where the Standards potentially overlap with other leave laws and sick pay benefits, as this may assist with complying with the Standards as written.
If you have questions regarding Cal/OSHA’s emergency Standards or any other issue related to employment law, please contact one of our attorneys: