The Impact on Municipalities in Workers’ Compensation from COVID-19 and the Canzanella Law
Governor Phil Murphy signed S2380 into law on Monday, September 14, 2020 accomplishing for certain essential employees who contract COVID-19 exactly what the Thomas P. Canzanella Law did for first responders and public safety workers in July 2019 in relation to a wide variety of claims, including many cancers and communicable diseases. It is the goal of this blog to examine the similarities and differences in each law and to consider the financial impact each law will have on municipalities.
The Canzanella law took effect on July 8, 2019 and focused on protecting the rights of first responders and public safety workers who may suffer a wide range of physical and neurological injuries, including many cancers. The Essential Employees law was recently passed but was given retroactive effect beginning on March 9, 2020.
Similarities Between The Two Laws
1. The Canzanella law and the Essential Employees law have one very important aspect in common: the linchpin of both laws is to shift the burden of proof to employers. Each law removes the burden of proving one’s case from the covered employee and imposes that burden on the employer to disprove the case in the Division of Workers’ Compensation. One could say that each law makes it easier for a claimant to prove his or her occupational disease is work related. If you are covered by either law, the employer has to prove that the condition is not work related. In a close case, the practical result is that the judge will likely find for the employee because of the presumption concept.
2. Both laws use the same preponderance of the evidence standard that is currently used in every workers’ compensation case. In other words, the quantity of proof is more than 50%. An employee normally has to prove his or her case by more than 50% or by a “preponderance of evidence.” An employer will now have to disprove the case by more than 50% for someone who is covered by the law. To use a sports analogy, the employer must move the ball past the 50 yard line. The covered employee really just has to play defense.
3. It is critical to understand the next point: neither legislation removes the obligation on the employee to prove that he or she has an impairment which warrants an award of compensation. What the law does is make it easier for the injured worker to prove he or she has a work-related occupational disease. But that is not enough. The employee still has to produce objective medical evidence through medical experts that the employee has a restriction of the body which impacts either one’s ability to work or to enjoy non-work activities. That may be fairly easy for someone who has lung cancer, but it may not be easy for someone who recovered well from COVID-19.
4. Both laws involve exposure to occupational illnesses. COVID-19 is considered an occupational illness, just like cancer would be under the Canzanella law. Neither is considered a traumatic event under the law, which means that the occupational statute applies. That statute requires the employee to show that the illness was produced by causes which are characteristic of or peculiar to work in a material degree. Occupational diseases are also subject to a separate statute of limitations: if the employee knows he or she has the medical condition and thinks it is related to work, the employee has two years to file a claim petition or otherwise the claim is time barred.
5. Public safety workers are covered under both laws, and the definition of a public safety worker is the same under both laws. It is a member, employee, or officer of a paid, partially-paid, or volunteer fire or police department, force, company or district, including the State Police, a Community Emergency Response Team approved by the New Jersey Office of Emergency Management, or a correctional facility, or a basic or advanced medical technician of a first aid or rescue squad, or any other nurse, basic or advanced medical technician.
Differences Between The Two Laws
1. The Canzanella law embraces a much wider range of illnesses than the Essential Employees law, which is limited specifically to COVID-19. The Canzanella law does cover exposures in epidemics like COVID-19, just like the Essential Employees law, but it goes much further. It also covers employees who meet the following situations:
- Exposure to carcinogens and work-related cancers
- Exposure to a wide range of communicable diseases
- Exposure to radiation and consequential illnesses
- Exposure to hazardous materials, toxins and chemicals released in connection with terrorist attacks
- Reactions to vaccines that are necessitated by bioterrorism or epidemics
2. The Essential Employees law only applies to COVID-19 claims and no other type of virus!
3. The Essential Employees law embraces many more workers than the Canzanella law because the Essential Employees law specifically refers to a wide range of private and public sector workers. There is an exhaustive list alone of healthcare workers who are covered.
Essential Employees are defined as:
- A public safety worker or first responder, including any fire, police or other emergency responders;
- Those involved in providing medical and other healthcare services, emergency transportation, social services, and other care services, including services provided in health care facilities, residential facilities or homes;
- Those who perform functions which involve physical proximity to members of the public and are essential to the public’s health, safety, and welfare, including transportation services, hotel and other residential services, financial services, and the production, preparation, storage, sale and distribution of essential goods such as food, beverages, medicine, fuel, and supplies for conducting essential business and work at home, or;
- Anyone deemed an essential employee by the public authority declaring the state of emergency
4. Another key difference between the two laws is that the Canzanella law has a very unusual delayed onset provision which no other New Jersey workers’ compensation statute employs. Under the Canzanella Law, a firefighter who has been out of active service for not more than 20 years and who is diagnosed with cancer can file a claim petition in the Division of Workers’ Compensation and still receive a presumption that his or her cancer is work related, provided the firefighter is not older than age 75.
5. The Canzanella law specifically relies on one scientific authority in proving a type of cancer is a known or suspected carcinogen. That authority is the International Agency for Research on Cancer.
6. The Canzanella law allows the employer to require the worker to undergo, at the expense of the employer, reasonable testing, evaluation and monitoring of health conditions of the worker which may be relevant to determining whether the exposure is linked to the occurrence.
Conclusions And Comments
Both laws will have a profound impact in driving up workers’ compensation costs for municipalities and public entities. Claim volumes will increase. The impact of S2380 will be more short-term in nature until a safe vaccine is available. Litigation on COVID-19 cases will be risky for both sides because science and medicine know so little about COVID-19. By contrast, the Canzanella law will have a lasting and more expensive impact on municipalities since cancer is the second leading cause of death in the United States.
While the impetus for the Canzanella law was the national catastrophe of 9-11 (hence the emphasis on bioterrorism), the specific provisions of the law which will be most costly for municipalities will be the cancer claims, such as prostate cancer, breast cancer, colorectal cancer, renal cancer, and other fairly common cancers that affect the entire American society regardless of occupation. There are already many cancer claims in the Division of Workers’ Compensation under the Canzanella law. They will be costly to defend because the public entity will need to retain highly qualified medical experts who charge considerably for their time in preparing reports and testifying in court.
Another aspect of the Canzanella law could prove very costly to employers if the vaccine that public safety workers and first responders take for COVID-19 turns out to have side effects. The Canzanella law covers public safety workers and first responders who are required to take vaccines in response to epidemics and who then have negative health consequences related to those vaccines.
The Essential Employees bill will also have an impact on workers’ compensation costs, particularly in death cases. However, most of the formal claim petitions filed to date involve police officers who have recovered from COVID-19 and are back to work. They have the burden of proving by objective evidence that they have an impairment that either materially affects them in work or in their non-work activities. Many of these cases will have small settlements. The high exposure cases will be COVID-19 death cases involving statutory dependents.
In retrospect, one can question why the Legislature did not attach S2380 to the Canzanella law rather than create a brand new law just for one particular strain of coronavirus. This has never happened before in New Jersey. Perhaps the Legislature felt that it could not do so because essential employees are defined to include many private sector workers, while the focus of the Canzanella law was mostly on public safety workers. Instead, the Legislature ended up creating two laws with a good deal of duplication. First responders were already covered by the Canzanella law for COVID-19 given that it is a communicable disease and an epidemic. First responders now have a different effective date of July 8, 2019, and other essential employees do not begin coverage until March 9, 2020. One question related to S2380 and essential employees is what will happen after the delivery of an effective vaccine effectively reduces COVID-19 claims to a trickle and a new strain of virus with a new number and name should emerge? These are certainly questions for risk management and elected officials to consider in the future.
By: John H. Geaney, Esq.
Capehart Scatchard P.A.