WCDefenseCA

Welcome back from the holiday, dear readers!

Your humble blogger has made no secret of his support for remote proceedings for court appearances.  Hearings conducted remotely have the general effect of reducing transmission of diseases, whether COVID19 or the common cold and everything in between.

By allowing for remote hearings, the court system further reduces the burden and costs of litigation by avoiding hours spent on the road.  It also allows for fewer continuances requested due to calendar conflicts – your humble blogger can attend an MSC before the Salinas WCAB and the Santa Rosa WCAB in the same morning, without having to physically travel to either.  Certainly, employers and insurers have welcomed the reduced bills from their defense attorneys where travel is no longer a line item.

While we still attend some trials (and, for some reason, walkthroughs) in person, the more we shift to remote proceedings the more efficient the system becomes, lessening burdens on the parties and expediting hearings and resolutions.

In a bizarre twist to the norm, California appears to be doing something good for a change!  AB133 would extend the authorization to appear at court proceedings in most instances remotely until January 1, 2026.  AB133 was approved by the Assembly on March 23, 2023, and is now before the California Senate. A very similar bill, SB133, was signed by Governor Newsom on June 30, 2023.

Hopefully, this is the start of a growing trend, and we can expect to see an increase in the WCAB’s use of remote technology in our proceedings. 

What do you think, dear readers?  Are you happy with ZOOM depositions and telephonic hearings?  Or would you like to go back to the good old days before the Pandemic?

Your humble blogger, dear readers, is a big fan of the AMC series Mad Men.  I swear I’ve watched the entire series through at least half a dozen times and enjoyed it every run.  The first episode of the series is called Smoke Gets in Your Eyes, about the main protagonists efforts to create an advertising campaign for Lucky Strike cigarettes.

Now, why is your humble blogger bringing this up?  I assure you, no change in career from law to advertising is being announced, and, rest assured, your humble blogger’s smiling and bow-tied photo will not be replacing camels, cowboys, or any tobacco mascot. 

But while smoking poses dangers, more or less everyone seems to be aware of those now adays.  Yet there is another source of smoke that is getting in the eyes of the workers’ compensation community.  Marijuana is continuing to be an issue for comp.

Whether it is legal or not, there is, after all, some conflict between state and federal law; and whether employers can be compelled to provide to employees, on an industrial basis, marijuana as a form of medical treatment remain open questions in California. 

Unfortunately, we have a new study released by Quest Diagnostics showing that in the US Workforce in general, “testing positive for marijuana following an on-the-job accident increased to its highest level in 25 years in 2022.” 

Are workers just being tested more often than they were before, or is there a higher frequency of use of marijuana than in years past?  Furthermore, is this higher use of marijuana the cause of injuries in the workplace?  If so, Labor Code section 3600(a)(4) provides an affirmative defense to such claims, but the burden of proof remains on the defendant, and offers no defense if one employee’s marijuana-fueled injury causing harm to other employees.

As social attitudes towards marijuana continue to change, employers are placed in a difficult position of keeping employees safe while complying with California’s laws regarding marijuana use.  For example, AB-2188 was signed into law by Governor Newsom in 2022 and takes effect January 1, 2024, makes it unlawful to discriminate based on off-the-job use of marijuana. 

While the law excludes those in the building and construction trades, and also does not “permit an employee to possess, to be impaired by, or to use cannabis on the job” one of the most effective ways of ensuring employees are not under the influence of marijuana while on the job is to decline to hire employees who use marijuana recreationally at all.

As if California’s employers did not have enough to contend with, the growing instance of marijuana related injuries and the state of California’s restrictions on addressing that trend certainly don’t make things any easier.

Puff, puff pass, dear readers… straight on till next time!

Happy Monday, dear readers!  It’s another beautiful week in paradise.  We’ve celebrated Cinco de Mayo, and, as we are clearing away signs of those festivities, we are getting ready for Mother’s day this Sunday.  In this world of uncertainty, dear readers, you cannot expect another reminder that Mother’s Day is coming up this Sunday, May 14.  It might already be too late, but do try to make those lunch reservations, order those flowers, and set aside time to give your mother a call. 

I think if our dear friends and family members were to visit us in California, they would expect to see certain things.  If they were here for a week without Sacramento trying to crush another swath of California’s businesses, they’d feel like they missed out.

So, it only makes sense that we take a look at Assembly Bill 1213, which just passed through committee at the end of April.  What does AB1213?  Well, what doesn’t it do?!?

A lot, to be fair, but primarily AB1213 exempts any periods of TD pending IMR review of treatment (and eventual overturn) from the TTD cap of Labor Code section 4656.

So, let’s take a scenario.  Applicant has a DOI of 1/1/2020.  He goes on TD and his TD would be exhausted by 1/1/2022, as per 4656(c).  Well, if applicant’s PTP submitted an RFA on 3/1/2020, and UR came back with a denial on 3/6/2020, all the periods from that 3/6/2020 denial to the IMR overturn would not count towards the 104-week cap.

What do we need to do if AB 1213 becomes law?  Well, in every file, we set reserves and value cases based on a range of exposure, factoring maximum exposure of course.  How can defendants adequately set reserves or value cases for settlement when there is almost a perpetual TD range?

It’s not all doom and gloom, of course – in 2021, IMR upheld 92.8% of UR denials.  The ultimate impact is going to be limited.  But this isn’t the only squeeze California’s employers and insurers are feeling from Sacramento.  There seems to be pressure from every end to make $100 in payroll more and more expensive for businesses in California. 

Now, if life was fair and California was interested in seeing justice for both employer and employees, when IMR denies a method of treatment, and the PTP has no other suggestions that are likely to change applicant’s condition substantially in the next year, as contemplated by 8 CCR 9785(a)(8), then we would also have regular findings that applicant is P&S retroactively to the date of a UR denial, once the IMR appeal has been exhausted.  We would also have TTD overpayment credit as a matter of right, rather than judicial discretion. 

What is good for the goose is good for the gander, after all, no?

But instead, we see a continuous stream of policies and rulings that disproportionately favor applicants at the expense of defendants in Workers’ Compensation.  My beloved readers, the secret to youth, I have found, is to maintain that adolescent naivete which objects to injustice and life being unfair.  That is how your humble blogger maintains feeling like a 20-year-old.

Like so many other recent results from Sacramento, AB1213 seems worthy of watching.  But, likewise, we can watch the cost of doing business in California as it continues to rise.

Happy Wednesday dear readers!

What’s the most typical response to any C&R offer made throughout California’s workers’ comp system?  You might think it’s “more money please” but you’d be wrong.  Back when we still appeared in person at the Board, you would hear the rich, ceremonial exchange much like you would expect to hear “thunder” and “flash” in WWII – the answer being, of course, “will your client require a resignation?”

Well, as we know Labor Code section 2810.8 now requires employers to prioritize rehiring employees laid off due to COVID19 for covered industries, and, in 2019, Governor Newsom signed into law AB749 which rendered unenforceable  any agreement not to seek rehire with an employer as part of any C&R.

Sacramento is not done – eager to continue restricting an employer’s ability to choose who it does, or does not, do business with, earlier this year Senator Durazo introduced SB723 which would expand the scope of Labor Code 2810.8 from COVID19 layoffs to any employee with more than 6 months on the job who was let go as a result of “a public health directive, government shutdown order, lack of business, reduction in force or other economic nondisciplinary reason.”

SB723 also removes the sunset provision placed on section 2810.8, which was set to be rescinded at the end of 2024.

Of course, the employer will still be required to notify any “laid off” employee of an open position and faces penalties for failing to prioritize previously laid-off employees. 

Again, Sacramento is intent on making regulatory compliance impossible for functioning businesses in California.  Hopefully, SB723 will be dismissed from the legislature for the job-killing bill that it is.

In the meantime, perhaps defendants must be more careful about resignation language when resolving claims?  If SB 723 does become law, should resignation letters reflect that this is a voluntary resignation and not a “layoff” as contemplated by Labor Code section 2810.8?

Well, picture this – applicant goes off work on TTD for an accepted injury.  In the meantime, the employer has to institute layoffs for one of the reasons enumerated in SB 723.  Applicant enters into a C&R with the employer and, because he is already laid off, no resignation is requested as part of the C&R.  Three months after the C&R check clears, business picks up and the employer need to hire more employees.  Does applicant now have priority for that same job?  It sounds like, under SB 723, applicant does, and the employer is stuck paying for the same injury a second time. 

The level of compliance necessary to avoid being sanctioned by California rises and rises.  Sadly, Sacramento does not appear to concern itself with helping the employers that barely made it through 3 years of lockdowns due to COVID19. 

What do you think, dear readers?  More paranoia from your humble blogger?

Happy Monday, dear readers, and more to the point, happy New Year!

We made it, and here we are!  I know we all had some doubts.  But, I thought it only fair to bring to the attention of my beloved readers and my despised detractors alike that practically no one is making predictions about the future any more – no one is saying “2023 is going to be my year!” or “the year of the Humble Blogger is at last at hand!”  We’re all very cautiously moving forward with only one goal and aspiration in mind for 2023

What better way to start another wonderful year of blogging than by giving a heads up on the laws taking effect 1/1/23?

First off, a chronic favorite here at WCDefenseCA, minimum wage!  Starting 1/1/23, minimum wage goes up to $15.50 per hour for all employers, possibly more by local ordinance.  What does that mean for you?  If you’re paying TD for an employee who was earning minimum wage at the time of injury, that employee’s “earning capacity” has now increased by operation of the minimum wage law, which means you should be prepared to reassess TD rate.

Second, everyone’s favorite abomination of a law: SB1127 is now in effect for all dates of injury!  What does that mean? If you had 90 days to investigate a claim you might have 75 now depending on the nature of the injury alleged and the occupation claimed.  No one knows how this will play out as the law was so poorly drafted and reasoned out.  Furthermore, you might think yourself safe if you’re not employing peace officers or firefighters or corrections officers.  But what about COVID19 presumption cases such as outbreaks or healthcare workers?  Time to take a look carefully because if workers’ compensation were a ship, our location on the map would read “here be dragons!”

To quote Lorne Malvo in Fargo: “Because maps used to say ‘there be dragons here.’ Now they don’t.  But that don’t mean the dragons aren’t there.”  And, of course, if you’re looking at the costs of litigation SB1127 in uncharted territory with the prospect of $50,000 in penalties, a dragon to face is not an unreasonable analogy.

Other notables include AB-257, which allows the government to raise wages for food workers up to $22 per hour, and of course SB-1162, which requires employers with more than 15 employees to disclose wage ranges for a given position to prospective and current employees.

What does that mean for us, dear readers? It means that California employers are going to have an even harder time keeping the lights on.  Those of us who have not left the state are going to be very busy working to make sure the shifting of more and more of society’s burdens on employers is kept to a minimum.  Cheer up, dear readers – at least we won’t be bored!

Happy New Year!

Are you tired of hearing more and more about new legislation coming out of Sacramento, dear readers?  I didn’t think so.

Your humble blogger has one for you that isn’t directly a workers’ compensation bill, but that you should be aware of.  Senate Bill 1162 was signed into law by Governor Newsome on September 27, 2022.  Aside from imposing various reporting requirements on employers regarding the race and sex of their employees, to also post a salary range with any job advertisement and create penalties for failure to do so.

How does this apply to workers’ compensation matters?  Well, imagine if you will an injured worker on TD benefits who happens to notice that his employer is hiring for the same position.  It doesn’t have to be a replacement, but perhaps the employer is looking for an additional professional for the same job – another plumber, another waiter, another janitor.

Well, as we know, TTD benefits are calculated based on the earning capacity of the injured worker at the time of injury.  What happens when the employer posts a pay scale in accordance with the new Labor Code section 432.3 and the scale provides for a higher rate of pay than the employee was receiving at the time of injury?

Suddenly, the employer is subject to depositions regarding how it arrived at the pay scale and why applicant is not receiving more on the pay scale than he is.  The adjuster is faced with demands to pay higher on the pay scale or be exposed to penalties.

SB 1162 goes further still – not only are new job posts to include the pay scale, but current employees can demand disclosure of a pay scale for their respective positions under LC 432.3(c)(2).  Your humble blogger anticipates that applicant attorneys will exploit this by having their clients, employees presently on TTD, demand the pay scale for their respective positions and then use workers’ compensation discovery procedures to develop the record on why the “earning capacity” should be higher on the pay scale.

Claims for higher TD rates and related penalties would certainly follow.

So, how do we address this newest burden imposed on employers and insurers in California?  Well, for starters, employers need to invest some serious time into considering a pay scale and having competent HR or supervisor employees explain the basis of the scale.  Employers should have a decision maker who can testify competently, under oath at a deposition or at an expedited hearing, how a particular pay rate was reached. 

From the side of litigation and claims, we need a strong channel of communication with the employer and HR to provide us with those competent witnesses, but also to update us as to the current pay scale for any given position, as those pay scales will certainly change with time and circumstances, and where applicant falls on the pay scale and why.

Time after time, Sacramento has made very clear to the employers and insurers of California that it is open season on anyone providing employment in California.  Given this climate, it only makes sense that the defense community become more proactive and more cooperative with the tools available to defend these claims and keep the lights on.

See you next week, dear readers!

Happy Wednesday, dear readers!

Your humble blogger has some rather unfortunate news for you.  On September 29, 2022, Governor Newsom signed SB-1127 into law.  As my readers may recall, this most humble of blogs touched on earlier versions of the bill, but the one signed into law isn’t much better.

As enacted, SB 1127 reduced the normal investigation period of 90 days to 75 and imposes up to $50,000 in penalties for “unreasonably denied benefits” as part of a denial in certain presumption cases (generally firefighters and law enforcement and the such).  It also increases TD from 104 weeks to 240 weeks for firefighter and law enforcement presumption cases as found in Labor Code section 3212.1.

Defendants affected by the presumption cases will be put in the untenable position of having to investigate the causation of a claim within 75 days or face up to $50,000 in penalties for not accepting the claim.  We can all do the math – if a particularly responsive adjuster manages to get a delay letter out on the same day as receiving the claim form, that’s at least 15 days before a panel can be requested.  In pro per cases, that has to be done by mail, but let’s assume this is an issue in a represented case and a panel can be obtained immediately. 

Well, there’s another 15 days for the strike process, which makes 30.  Now the employer has 45 days left to get a report upon which to issue a denial.  The regulations allow for up to 90 days for an appointment and another 30 days for a report after that. 

How is the employer supposed to get a QME report upon which to contest causation before it’s forced to deny the claim pending the investigation?  Well, it’s not.  The purpose of SB 1127 is to turn joint powers groups, local municipalities, cities, counties, fire districts etc., into piggy banks for the presumption class of employees.

Now, dear readers, if you’re thinking excitedly “that’ what you get!” after you got a parking ticket and were forced to pay it, don’t get too excited.  As is often the case with Sacramento, this is a test – the face-value beneficiaries of this legislation are sympathetic (police and firefighters, mostly) and have a robust and strong union.  But rest assured, this is a test of how the system will work.

Once this is firmly in place and part of the routine for the public sector, such legislation will surely follow to further plunder the private sector.   Sacramento will of course consider pushing the investigation period down to 75 days for all employers and impose similar penalties for failing to accept a case.

So, how should we change claims handling in light of SB 1127?  Well, for starters, we should be reserving more for potential TD exposure.  Additionally, the employers and supervisors should be updated on claims handling procedures and reminded of how important it is to report the receipt of a claim form/notice of injury IMMEDIATELY.  Claims handling should continue to thoroughly document the files and be prepared to challenge claims of “unreasonable” rejection of liability with asserting a record of diligent investigation – prompt requests for panel and writing to the QME, possibly even deposing treating physicians if necessary. 

Buckle in, dear readers, this is going to be a bump ride!

On a side note, to my beloved readers observing Yom Kippur today, your humble blogger wishes you an easy fast – G’mar chatimah tovah!

I don’t know who your favorite Addams Family member is, but I’m fairly certain, dear readers, that it’s Wednesday… at least today.

Greetings from beautiful Lake Tahoe dear readers!  The air is thick with the smell of cigarettes, the floor is littered with eternal optimists nervously trying to “make back what [they] lost so they can at least break even,” and your humble blogger is here, jumping from one side of the border to the other madly chanting “Now I’m in California, now I’m in Nevada, now I’m in California again.”  This magical place never gets old!

But since you’ve made the commitment to visit the blog or open your e-mail, I owe you some news which I am not exactly thrilled to deliver.   Governor Newsome, in an effort to make a meal less affordable for Californians, has signed the disastrous AB 257 into law.

This will allow the state of California, through a council, to increase wages for fast food restaurants which are part of a “fast food chain” consisting of “100 or more establishments nationally that share a common brand or that are characterized by standardized options for décor, marketing, packaging, products, and services” up to $22 per hour.  Just for reference, the general minimum wage in California is set to reach $15.50 per hour on January 1, 2023.

Aside from making fast food either ridiculously expensive or unprofitable to the point that it would no longer be available, especially when being provided by smaller franchise groups, it’s also going to drive up costs on workers’ comp TD and PD benefits.

Imagine if this council raises a fast food employee’s wages up to $22 per hour from $15 per hour.  Aside from the fact that the employer is being squeezed without any respect for its own rights, a full-time employee working at $15 per hour has an average weekly wage of $600, but an employee making $22 per hour for those hours has an AWW of $880 per hour.  The $280 difference per week yields an additional $186.67 per week in TD benefits.

Adjusters should keep this in mind as applicants out on TD can very well be awarded increases based on a raise in base-wage by operation of AB 257.   

Likewise, employers and supervisors should keep a regular and open line of communication with their claims adjusters to advise them when a particular location is struck by this council, so that the defense can avoid penalties and interest and, of course, audits by California.

Until next time, dear readers!

Happy Wednesday dear readers!

Ok, dear readers, pop quiz.  How do you calculate temporary disability benefits in a full time, regular employee?  You’d typically take the average weekly wage for the 52 weeks prior to the date of injury and then divide that sum by 1.5, right?  Sometimes you might adjust for increased wages (such as a Union raise) or you might make sure the rate is not below or above the statutory minimum and maximum.

Well, if Sacramento has its way, that won’t be the end of it.  Allow me to bring to your attention SB1458, introduced by Senator Monique Limon of California’s 19th Senate District. 

Senator Limon’s bill would add Labor Code 4453.1 to the labor code, which would increase the average weekly wage calculation “by the percentage of disparity in earnings between genders as reported by the applicant’s employer in it spay data report to the Department of Fair Employment and Housing…” if the applicant’s average weekly wage is less than the average weekly wage of the opposite gender.

If the employer made no such report to DFEH, SB1458 would require an increase based on the United States Department of Labor Statistics.

Of course, this added temporary and permanent disability benefit is not going to come out of Senator Limon’s pocket – the legislation would make the employer not only bear the cost of these calculations and open the door for further litigation on the proper TD and PD calculation, but would also make the employer pay the burden of the added benefit. 

This legislation, of course, flies in the face of the history of case law that bases average weekly wages on earning capacity.  Would a worker injured on his first day on the job be expected to make the same wage as employees who had been at a particular company for several years? 

Your humble blogger hopes with all his heart that SB1458 never becomes law, but if it does, the additional burden on claims administration will be significant.  Claims adjusters will have to determine the following:

1. The gender of the injured worker (and your humble blogger is willing to bet that we will see the case where there meaning of the word “gender” is litigated)
2. The average weekly wages for the applicant;
3. The percentage of difference between the average weekly wages for the opposite gender,
4. And the disparity between the two.

Of course, the legislation does not provide for the opposite: if a particular gender is making less than the injured worker, the employer does not get a break by reducing the TD by the disparity.

The bill for having the doors open and the lights on in California just keeps getting bigger, no?

Till next time, dear readers!

Happy Wednesday dear readers!

You know, if writing blog posts about horrible proposed legislation was a full time job, your humble blogger would demand overtime pay after doing it for 32 hours per week.  Does that sound like gibberish?  Well, it should…

Allow me to direct your attention to Assembly Bill 2932, introduced by the California Legislature last month to cap full time at 32 hours and make overtime pay mandatory for all work done in excess of 32 hours per week.  If that sounds familiar, it should – your humble blogger respectfully drew your attention to a federal proposed bill, H.R. 4728, that would have a similar effect.

The California bill would apply to those employers who have more than 500 employees, although the plain language of the bill does not appear to limit that number to California employees.  Presumably, an employer with 10 employees in California but 500 employees globally would have to start paying overtime at 32 hours for its California employees.

Another bizarre component to the bill is that it prohibits employers from reducing an employee’s regular rate of pay to end up with the same weekly wage at 40 hours. 

Should AB 2932 become law, much like with H.R. 4728, we can expect increased AWW calculations, including for those employees who worked more than 32 hours per week prior to going out on temporary total disability.  

So, dear readers, this is another one to watch…