Some news that’s been traveling around the California Workers’ Compensation blogosphere has found its way to this site. The state average weekly wage (SAWW) has increased, and so shall the minimum and maximum temporary disability payments for insurance companies and self-insured employers.
Under Labor Code § 4453(a)(10), “[c]ommencing on January 1, 2007, and each January 1 thereafter, the limits specified in this paragraph shall be increased by an amount equal to the percentage increase in the state average weekly wage as compared to the prior year.”
As per the code section, the test is the weekly wage as reported by the United States Department of Labor for the 12 months ending on March 31st.
So for 2012, the fate of temporary disability payments was sealed on March 31st, 2011. According to the U.S. Department of Labor (scroll down to see California), the average weekly wages are now $1,003.55.
As per Labor Code § 4659(c), this increase will also affect the pensions of those employees injured on or after January 1, 2003.
On the one hand, this means more payouts, higher insurance premiums, and a slightly larger incentive to file a claim.
On the other, it provides more of an incentive to fight bad or fraudulent claims. Remember, even a $50 increase in temporary disability, over two years [see Labor Code § 4656(c)(2), totals $5,200.00. If the claim is fraudulent, that’s money that no defendant should have to pay.
Slight increases in temporary disability, just like any other indemnity, add up and quickly become cheaper to fight than to pay. After all, when a self-insured employer or an insurer gets a reputation for big settlements, the claims increase to match. Just a thought.
Thank you..really informative!!
minimal wage increases will lead to unemployment rate increases.
actually, this is just an indication of the average wages in California. This does not have any connection with local, state or federal minimum wage for un-injured workers.