It’s Wednesday, dear readers, and your humble blogger brings to your attention a case that is distinct for two very important reasons.  The first is that the opinion reflects the WCAB’s intention to affirm its prior En Banc decision.  The second, which is only important to WC nerds like myself, is that this case has the distinction of being the first reported by Lexis for this decade.  In fact, the citation itself is 2020 Cal. Wrk. Comp. Lexis 1.

Now, onto the case itself – Dennis v. State of California.  The WCAB held that Rule 10133.54, which provides that parties make refer their disputes regarding SJDB vouchers to the administrative director, was invalid as conflicting with Labor Code section 5300, which holds “the following proceedings shall be instituted before the appeals board and not elsewhere…” including “the recovery of compensation, or concerning any right or liability arising out of or incidental thereto.”

It further held that “an employer must show that it made a bona fide offer of regular, modified, or alternative work in order to avoid liability for a [voucher].”

In the Dennis case, following an admitted injury sustained by an inmate laborer, the employer sent an notice of offer of regular, modified, or alternative work which offered work contingent upon applicant showing he was eligible to accept the position, which he, of course, was not: he had been released from incarceration!

The Administrative Director did not respond to the request for dispute resolution, so applicant filed a DOR and went before the WCAB.  The trial judge held that the appeal of the Administrative Director’s presumed decision was not timely and that he was not entitled to the voucher.  Upon appeal, however, the WCAB granted reconsideration, concluding that applicant was entitled to the voucher. 

With respect to the WCAB’s holding that the regulation allow the administrative director to hear disputes about vouchers, I don’t think it has that much of an impact.  Yes, it removes one more hoop applicants have to go through to pursue the voucher, but since the determination of the administrative director would be appealed to and heard by the WCAB in any case, vesting decision-making power with a WCJ doesn’t add much to the calculations.

However, the other ruling, that a “bona fide” offer of work has to be made to avoid liability for the voucher… that’s something else.  The WCAB interpreted Labor Code section 4658.7(b), which states in pertinent part “[i]f the injury causes permanent partial disability, the injured employee shall be entitled to a [SJDB Voucher] … unless the employer makes an offer of regular, modified or alternative work…” to read in the words “bona fide” or “good faith” into the language of the statute. 

As an aside, if we’re going to require parties in workers’ compensation matters to act in good faith, can we please require pleadings to be made in good faith as well?  How many times, dear readers, have you had an applicant’s attorney dissatisfied with your spine QME, suddenly claim a CT to get another bite at the apple? Your humble blogger is aware of zero consequences to the applicant or the applicant’s attorney for filing baseless cumulative trauma claims, costing thousands of litigation dollars and needless driving up employer x-mods.  Feel free to show me the error of my ways.

In footnote 19 of the Dennis decision, the WCAB cites authority to define good faith as “genuine” or “made with earnest intent.”   Accordingly, the fact that the employee cannot accept an offer of work because he is no longer incarcerated is not a defense to providing a voucher.  Defendant was then ordered to provide a voucher to applicant.

In discussing this case with reader W.A. (which WC nerds such as your humble blogger tend to do)several hypotheticals came up, all which centered around one fact: a change in circumstance completely unrelated to the industrial injury: The loss of a professional license; geographic limitations (such a domestic violence restraining order from a co-worker); discovery of immigration status issues post-injury.

Or, to reverse the Dennis case facts – what happens when applicant cannot accept the job because he has become incarcerated?

Labor Code section 4664 provides that “the employer shall only be liable for the percentage of permanent disability directly caused by the injury…”, but a SJDB voucher is not permanent disability.

What about a different approach?  In Dennis, the employer made the offer of work “subject to applicant verifying they are lawfully qualified to accept employment…”  What if the offer did not have any qualifications, but a termination for cause followed failure to present to the job?  When the applicant cannot report for work in the prison because he cannot get through the front gate, then the employer proceeds with termination for job abandonment.  When an attorney shows up for work but has been disbarred, a termination of employment follows. 

The problem with this approach is, of course, that not only does it run the risk of having the WCAB rule that the “offer” was not valid if the employer knew or should have known that the injured worker could not accept, the employer also runs the risk of 132a exposure.

Having handled a few 132a cases myself, I can attest that more than once I’ve heard employers tell me “we didn’t fire him because he had an injury at work, we fired him because he lied about having a workers’ comp injury!”  As you can imagine, that line of reasoning doesn’t do too well when we get down to trial. 

Maybe someone will decide to run the gauntlet and try this theory out?  If you are that brave soul, dear reader, please don’t forget to let your humble blogger know how it goes: I’ll be happy to broadcast your success or lament your failings on this most humble of blogs.