A3999 —

A3999 SCSACS AAPFISCAL StatementESTIMATE 7/27/20 ASSEMBLY APPROPRIATIONS COMMITTEE   STATEMENTLEGISLATIVE TOFISCAL  ESTIMATE ASSEMBLY COMMITTEE SUBSTITUTE FOR ASSEMBLY, No.

3999   STATE OF NEW JERSEY 219th LEGISLATURE   DATED:

 JULYAUGUST 27,5, 2020          TheSUMMARY Assembly  AppropriationsSynopsis: Committee reports favorably an Assembly Committee Substitute for Assembly Bill No.

3999.Concerns employment benefits and coronavirus disease 2019 infections contracted by essential employees.

     Type This bill creates a rebuttable presumption that coronavirus disease 2019 contracted by health care workers, public safety workers, and other essential employees, is work-related and fully compensable for the purpose of workers’Impact: compensation benefits and other employment benefits provided for work-related injuries and illnesses.

Indeterminate Expenditure Increase to the State and local entities.

Agencies Affected:

Department of Labor and Workforce Development.  Department of the Treasury, Division of Pensions and Benefits.

    Office of Legislative Services Estimate Fiscal Impact Year 1  Year 2  Year 3    State Cost Increase Indeterminate   Local Cost Increase Indeterminate           ·         The Office of Legislative Services (OLS) estimates that the enactment of this bill may result in an indeterminate increase in expenditures to the State tied to a potential increase in claims for workers’ compensation benefits from essential workers who are incapacitated or unable to perform their duties as a result of contracting coronavirus disease 2019 through the course of their employment.

·         While it is worth noting that retirement costs for public employers may increase as a result of the bill lowering the burden for essential workers to demonstrate that they are eligible for Ordinary Disability and Accidental Disability Retirement for the Public Employees’ Retirement System (PERS), and any other applicable benefits, the OLS does not have sufficient information on which to estimate the net fiscal impact of this bill for any individual public employer or for all public employers combined.

·         The bill will also most likely result in annual increased costs to State and local entities due to the shift of the burden of proof from the worker to the employer in certain cases, which may result in increased claims for workers’ compensation benefits.

BILL DESCRIPTION         This bill creates a rebuttable presumption that coronavirus disease 2019 contracted by health care workers, public safety workers, and other essential employees is work-related and fully compensable for the purpose of workers’ compensation benefits and other employment benefits provided for work-related injuries and illnesses.

      1.  1. is a public safety worker or first responder, including any fire, police or other emergency responders;

     Is 2.  a ispublic involvedsafety inworker providingor medicalfirst andresponder, otherincluding healthcareany services,fire, emergencypolice transportation,or social services, and other careemergency services,responders; including services provided in health care facilities, residential facilities, or homes;

      3.  2. performs 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;

orIs      involved 4.  in isproviding anymedical and other employeehealthcare deemedservices, anemergency essentialtransportation, employeesocial byservices, theand publicother authoritycare declaringservices, theincluding stateservices ofprovided emergency.in health care facilities, residential facilities, or homes;

      The3. bill provides that an employee who is an employee of the State who is offered the option of working at home but has refused that option will not be regarded as an essential employee.

     Performs Thefunctions billwhich providesinvolve thatphysical anyproximity workers’ compensation claims paid according to sectionmembers 2 of thisthe actpublic willand notare beessential consideredto inthe calculatingpublic's anhealth, employer’ssafety, Experienceand Modificationwelfare, Factor,including pursuanttransportation toservices, thehotel Newand Jerseyother Workers’residential Compensationservices, andfinancial Employersservices, Liability and Insurancethe Manualproduction, administeredpreparation, bystorage, thesale, Compensation Rating and Inspectiondistribution Bureauof establishedessential bygoods sectionsuch 2as offood, P.L.1995,beverages, c.393medicine, (C.34:15-89.1)fuel, and sectionsupplies 1for ofconducting P.L.2008,essential c.97business (C.and work at home;

34:15-90.1).or       4.

Is any other employee deemed an essential employee by the public authority declaring the state of emergency.

      The bill provides that any workers’ compensation claims paid under the bill will be excluded from an employer’s experience modifier pursuant to the New Jersey Workers’ Compensation and Employers Liability and Insurance Manual administered by the New Jersey Compensation Rating and Inspection Bureau.

       As  reported,FISCAL thisANALYSIS bill  isEXECUTIVE identicalBRANCH to  Senate      BillNone No.received.

(SCS)  (1R)OFFICE OF LEGISLATIVE SERVICES         The OLS estimates that the enactment of this bill may result in an indeterminate increase in expenditures due to a potential increase in workers’ compensation benefit claims from certain  workers who are incapacitated or unable to perform their duties as a result of contracting coronavirus disease 2019 through the 2020-2021course session.of their employment.

       FISCALThe IMPACT:OLS does not have sufficient information on which to base a determination of the fiscal impact of this bill for any individual public employer or for all public employers’ combined contribution to PERS.  The OLS believes, however, that the overall impact will likely be felt primarily by local governments and not the State because most essential workers are employed at the local level.

      The Officebill provides essential workers, as defined under the bill, who become incapacitated or unable to perform their work duties as a result of Legislativecontracting Servicescoronavirus (OLS)disease estimates2019, with a rebuttable presumption that the enactmentincapacitation ofthey thisexperience billis mayrelated resultto work place activities and is compensable through workers’ compensation benefits.  This is a shift in anthe indeterminatecurrent increasesystem for certain workers in expenditureswhich tothe worker has the Stateburden tiedof proving that the injury, disability or death is related to aworkplace potentialactivities.  increaseIt is possible that this shift will result in the filing of additional claims for workers’ compensation benefits.  The OLS notes that individuals may be more likely to apply for workers’ compensation benefits fromif essentialthere workersis whoan areunderstanding incapacitatedthat orthey unabledo not have to performbear the burden of proving the connection between their dutiesworkplace asactivities aand resulttheir contraction of contractingthe coronavirusdisease.  diseaseHowever, 2019it throughshould be noted that the courseadditional claims, and shifting the burden of theirproof, employment.may have a fiscal impact, which the OLS cannot quantify with any certainty.

      WhileThe itOLS isdoes worthnot notinghave thataccess retirementto costsindependent foractuarial publicinformation employers may increase as a result of the bill lowering the burden for essential workers to demonstrateanalyze that they are eligible for Ordinary Disability and Accidentaldetermine Disability Retirement for the Publicimpact Employees’of Retirement System (PERS), and any other applicable benefits, the OLSpossibility doesof notincreased haveclaims sufficient information on whichworkers’ tocompensation estimatetotal thecost net fiscal impact of thisclaims. bill for any individual public employer or for all public employers combined.

     However, Thesince billa willmajority alsoof mostpublic likelyentities resultare inself-insured annualfor increasedworkers’ costscompensation, toany Stateincreases and local entities due to the shiftcosts of theworkers’ burdencompensation ofwill proofbe fromfunded thedirectly workerby tothese theentities. employer in certain cases, which may result in increased claims for workers’ compensation benefits.

    Section:

Commerce, Labor and Industry Analyst:

Juan C.

Rodriguez Senior Fiscal Analyst Approved:

Frank W.

Haines III Legislative Budget and Finance Officer     This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

  This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).