When Does the Subsequent Injuries Fund Pay On a Claim?

California law requires that the majority of employers carry workers’ compensation insurance to provide for their workers in the event that they sustain a work-related injury during the course and scope of their employment.  Unfortunately, some employers either do not carry this insurance or even do not realize that they are required to do so.  California Labor Code § 3351 defines “employee,” and the definition is broader than most people realize, including even workers such as handymen, nannies, and minors.  In the event an employee sustains an injury, the Uninsured Employers Benefit Trust Fund (UEBTF) may provide funding for the employee.  If the employer is illegally uninsured and fails to pay the compensation awarded to the employee by the Workers’ Compensation Appeals Board, the employee may submit a claim to the UEBTF for payment of his or her claims.

The Subsequent Injuries Benefits Trust Fund (SIBTF) is another source of compensation for injured workers.  Under California Labor Code § 4751, employees who had a previous permanent disability or impairment at the time he or she sustained another injury in the work place can apply to the SIBTF for compensation.  To be eligible for compensation from the SIBTF, the injury from the current employment combined with the previous disability or employment must have the combined effect of at least a seventy percent permanent disability for the worker.  Moreover, the new injury must cause at least thirty-five percent of the permanent disability.

Note that an employer does not have to be illegally uninsured for an injured employee to be eligible to receive benefits through the SIBTF.  The SIBTF is meant to help pay a portion of the permanent disability compensation for permanently disabled workers for qualifying workers, as described above.  If an employee qualifies to receive benefits through the SIBTF, the employer will pay only the portion of permanent disability that is attributable to the injury received through the current employer.  The SIBTF will pay the remainder of the benefits owed to the employee.  The purpose of the SIBTF is to encourage employers to hire workers who are already permanently disabled without fear that they will be held responsible to pay benefits that are attributable to a permanent disability incurred through previous employment.

We have extensive experience in assisting our clients understand the repercussions of all types of workers’ compensation claims on their business.  Call us today so we can talk with you about your business and its responsibilities.

Do I Have to Pay for My Worker’s Prior Disability if He Gets Injured? (Apportionment)

As an employer, you know that making sure you provide workers’ compensation benefits for your employees is important and in most circumstances is required by California law.  Workers’ compensation provides protection for the employee because it establishes a no-fault system under which an injured worker can receive compensation for his or her work related injuries.  It also provides protection for the employers, as this no fault system means that the employer does not have to worry about being sued by their employees for recovery for injuries sustained during the course and scope of employment.  Although you certainly understand that workers’ compensation is designed to compensate your injured employee for injuries sustained at your business, it is also important to understand your potential responsibility if the employee had sustained an injury previously at a different business.

Apportionment is designed to allow disability percentages to be assigned to previous injuries to the same body part injured and at issue in the current workers’ compensation case.  California Labor Code § 4664(a) states “The employer shall only be liable for the percentage of permanent disability directly caused by the injury arising out of and occurring in the course of employment.”  The law goes on to provide that if there is a pervious determination of permanent disability, then it is presumed that the permanent disability still exists at the time the next workers’ compensation claim is made.  If the request for apportionment is successful, the amount of workers’ disability benefits received by your employee in the current case will be reduced.  To successfully show apportionment, there are specific requirements concerning the doctor’s assessment.  First, a doctor must make a specific determination of apportionment.  This determination must be done using percentages of what existed at the time of the injury.  The doctor must also analyze the permanent disability based on the causation of the disability, not causation of the injury itself.  Third, the opinion must be based on facts and not on speculation.  Fourth, the opinion must be based on a “reasonable medical probability.”  Finally, the doctor must explain how and why he or she reached the particular conclusion.  There are other requirements for a successful claim such as showing the employee was actually compensated for the previous injury and the injury continued to be a source of disability after the accident.

We have extensive experience helping our clients understand apportionment and how to protect their business.  Contact us today for an appointment.

What Is Permanent Disability?

As a business owner, you take every measure possible to reduce the chance of injury to your employees as much as possible.  Unfortunately, no matter how much you strive for an injury-free work place, it is overwhelmingly likely that an injury will eventually occur.  If during the course and scope of employment, your employee sustains an injury, he or she will likely be entitled to receive workers’ compensation benefits.  The type and percentage of disability is a central component of disability claims.

The California Department of Industrial Relations defines permanent disability as “any lasting disability from your work injury or illness that affects your ability to earn a living.”  If an employee is permanently disabled, he or she will be entitled to permanent disability benefits, regardless of whether that injury renders him or her unable to work in the future.  In most cases, permanent disability is determined through Whole Person Impairment (WPI).  This will be determined after the employee is examined by his or her doctor or a Qualified Medical Evaluator.  The doctor or QME will determine the percentage of impairment level, meaning how the injury will impact the employee in his or her ability to work.  The QME will use the standards established by the American Medical Association in making this determination.  The impairment level will then be reduced to a percentage, using a formula which also takes into account the employee’s age and occupation. In cases involving psychological injuries, the injury must either be categorized as catastrophic or the employee must have witnessed a violent crime in the course and scope of employment.  Taking all of these elements into account, the disability evaluator or the judge will then use the statutory formula and decide the amount of permanent disability the employee is entitled to receive.  The amount the employee will be entitled to receive will also be impacted by the date of the injury in addition to the wages paid to the employee before he or she was injured.  The permanent disability benefits typically begin being paid after the end of temporary benefits and the doctor indicates that the injury has “stabilized.”  This means that the injury will not heal or improve any more.

If you have questions about disability payments to your employees, contact us today.  We look forward to discussing workers’ compensation with you and what we can do to help protect you.

How Long Can My Worker Stay Out on Temporary Disability?

There are many precautions that careful employers will take to make sure that workers are not injured during the course and scope of their employment.  Keeping equipment in good repair, having updated training for all workers, and creating a safety committee are just a few ways that may help reduce work-related injuries.  Despite the best safety measures, however, it is highly likely that a worker will eventually be injured on the job.  If this occurs and the injury is severe enough to prevent him or her from doing his or her job during recovery, then that person is said to be temporarily totally disabled.  This is a determination that can only be made by a medical professional.  While the worker is healing, he or she can apply to receive two thirds of the wages he or she received while performing the regular duties associated with his or her employment, up to a maximum amount set by statute.  Especially when a worker is out for a substantial amount of time, as an employer, you may wonder how long that worker can stay on temporary disability.

If a worker sustains an injury that prevents the employee from coming to work for at least three days or requires the worker to be hospitalized (or both), then the worker may apply for temporary total disability.  California statute provides that the first payment must be paid within just fourteen days of when a doctor makes the determination that the work-related injury renders the worker unable to work.  Once the payments begin, there are several ways that the worker’s entitlement to continued temporary disability payments may end.  One way is that the injured worker returns to work in some capacity, even if it is not to the original position.  Another way is that a medical professional determines that the injured worker has recovered to the extent that he or she can return to work in some capacity.  Third, if the injured worker has received total temporary disability payments for the statutory maximum of 104 weeks, the worker will no longer continue to receive payments.  Finally, if the physician determines that the worker’s condition is stable and he or she will no longer improve, then the payments may then change to permanent disability payments.

We have extensive experience in helping our clients understand their rights and responsibilities with regard to their employees.  Contact us today to discuss your business and what we can do to help make sure you comply with the law.

What Is Laches?

The workers’ compensation system is often described as a “statutory scheme.”  This is because in 1911, the California legislature was directed to create the statutes and framework to help provide compensation to workers injured in the course and scope of their employment.  Because the system is based on these statutes and those that were amended or added later, it is said to be statutory in nature.  Nevertheless, there have been some times when equitable principles have been applied to workers’ compensation cases.  One of these principles is laches.

Laches is a legal doctrine that means that an otherwise enforceable right may not be enforced if there is an unreasonable delay in asserting that right, and that delay results in injury to the opposing party.  In essence, if you wait too long to bring a suit or ask for redress under the workers’ compensation system, the court may refuse to allow you to enforce your right to recover, even if you would have been able to recover if you brought your suit sooner.  The California Supreme Court in Kaiser Foundation Hospitals v. Worker’s Comp. Appeals Board determined that laches is applicable to workers’ compensation cases.  In that case, the Supreme Court determined that a claim for a lien can be barred by a defense of laches.  Other court cases since then have also applied the doctrine of laches to workers’ compensation cases.  For example, Godbolt v. Wherehouse Entertainment and Ace Insurance Company, the issue of laches came up when a case was settled in 1988 through a compromise and release, although the agreement did not relinquish jurisdiction over potential liens.  Eight years later, the lien claimant contacted the defendant.  The claimant then contacted the defendant again in 2000, 2006, and 2007.  It was not until 2009 that the lien claimant finally hired an attorney and attempted to move forward with the lien.  The defendant asserted the defense of laches, due to the unreasonable delay in bringing the claim as well as claiming it had been prejudiced by the fact so much time had passed.  The WCAB determined that laches did not apply in this particular case because the defendant failed to make the necessary showing that it was actually prejudiced by the passage of so much time.

If you have questions about the defenses available to your business in a workers’ compensation case, we can help answer them.  Call us today for a consultation.

What Is Subrogation?

The workers’ compensation system was established in 1911 by the California legislature to help provide relief for workers who were injured in the course and scope of their employment.  The system is what is called a “no fault” system, which means that the employee is not required to prove that the injury was the fault of the employer in order to recover for his or her injuries and ongoing disabilities.  In some cases, however, a third party’s actions or inactions may have contributed to the employee’s injury.  Under California Labor Code § 3850, et seq., an employer or the employer’s insurance company may exercise their right to subrogation in this instance.  Subrogation is the right of the employer and/or the insurance company to recover the amount paid under the workers’ compensation suit against a third party.  There are several ways that an employer may use subrogation to recover these expenses.

An employee may seek to recover against a third party whose negligent or even intentional conduct contributed to the accident causing the injury.  An employee may seek to recover, for example, from the equipment manufacturer for faulty safety systems or may sue a negligent driver for a car accident occurring during the course of the employee’s work.  If an employee files his or her own lawsuit against such a third party, an employer has a couple of options.  One option is to serve a Notice of Lien on all of the parties in the lawsuit.  This type of lien is considered a first lien against any recovery obtained by the injured employee.  This means that if the employee obtains a judgment from the lawsuit against the third party, the lien will be paid right after the employee’s attorney fees and legal expenses are paid.  Another option is to intervene in the law suit.  This means that your business will become a party to the lawsuit and will participate in the litigation.

If the employee does not decide to file his or her own lawsuit, your business or your workers’ compensation insurance company still have the independent right to file a lawsuit against a third party.  You should note that the statute of limitations will apply to your business, just as it would apply to the right of the employee to bring his or her own law suit.

If you have questions about subrogation or workers’ compensation, let us answer them.  Call us today for a consultation.

What Is Cumulative Trauma?

The legal system includes a variety of terminology that can seem confusing to non-lawyers, and the workers’ compensation system is no exception.  It is important to understand some of the basic terminology used in the workers’ compensation system to best defend your business.  One important different to understand is the difference between specific trauma and cumulative trauma.  Specific trauma is the kind of injury that typically comes to mind when you think of workers’ compensation, such as a broken arm in a car accident or a concussion from a fall from a ladder.  Cumulative trauma is a bit more nuanced.

Cumulative trauma, also referred to as a “repetitive stress injury,” is an injury sustained from repetitive stress or motions over time.  Carpal tunnel syndrome is the classic example of cumulative trauma, as it takes repeated motion, performed over time, in order to actually develop carpal tunnel.  Another example is the Chronic Traumatic Encephalopathy sustained by professional football players as a result of sustaining multiple concussions.  Cumulative trauma is a compensable injury under the workers’ compensation system, just like specific trauma.

Like specific trauma injuries, workers must bring a claim for cumulative trauma within a specific time frame.  Under California Labor Code § 5412, the worker must bring a claim within one year of discovering the claim or within a year of when the claim should have been discovered, had he or she been exercising reasonable diligence and care.

The California Workers’ Compensation Institute found that on average, cumulative trauma injuries were 53% more expensive than specific trauma cases.  In addition, workers claiming a cumulative trauma injury were much more likely to be independently represented by their own attorneys.  The institute also found that cumulative trauma is most prevalent in the manufacturing industry, which is attributable to the repetitive manual motions typically required of the workers.  Moreover, the study found that a worker claiming a cumulative trauma is ten times more likely to claim another injury.  With these types of statistics, it is clear that it is essential that you have a firm understanding on cumulative trauma and how to protect your business and your workers from these types of injuries and claims.

We have extensive knowledge in helping our clients understand cumulative trauma and the potential impact on their business.  Call us today for a consultation.

Schnore v. Progress Rail Services – Death Benefits and Workers’ Compensation

Work-related injuries are an unfortunate reality of owning your own business. No matter how careful you try to be and how many safety measures you implement to help protect your workers, a work-related injury is bound to happen eventually. Hopefully, when it does occur, the injury will be minor and the employee’s recovery quick and relatively painless. Unfortunately, in some tragic cases, a work-related injury could result in the death of the employee. When this occurs, the surviving spouse or dependents will still be eligible for workers’ compensation benefits. The California workers’ compensation system requires almost all employers to purchase workers’ compensation insurance to cover this very sort of scenario. However, the system is only set up to cover the employees of the business. Independent contractors are not covered under workers’ compensation insurance or benefits. However, the California labor code does not specifically define what it means to be an independent contractor. In a recent case, the California Court of Appeals was faced with a case involving the death of a worker and the classification of independent contractor versus worker.

In Schnore v. Progress Rail Services, a widow brought a claim for death benefits under the workers’ compensation system. Her husband died after suffering a fatal cardiac arrhythmia while driving a truck belonging to the defendant. The widow claimed that she was entitled to death benefits and her husband had been an employee. By contrast, the employer contended that the husband was an independent contractor, and therefore that the widow was not entitled to benefits under workers’ compensation. The court looked to the controlling case on the subject, S.G. Borello & Sons, Inc. v. Department of Industrial Relations. In that case, the California Supreme Court set out a specific set of factors that will assist in determining if a worker is an employee or an independent contractor. In this case, the court considered the fact that the defendant was the one who established the pick up and drop off points for the deceased’s freight loads. The court determined that this method of control was key and that it suggested the deceased was an employee. The widow’s argument was also helped by the fact the trailer used by the deceased was a specialized trailer, which also suggested employment instead of being an independent contractor. The court accordingly rejected the employer’s independent contractor defense and ruled in favor of the widow.

Making a determination about worker classification can be crucial for your business. Call me today at (714) 516-8188. We can talk about your employees and your business.

Borello and Independent Contractor Inquiry

California law is quite clear about an employer’s responsibility to carry workers’ compensation insurance. With very few exceptions, California employers of almost any size are required to carry workers’ compensation insurance for all employees. There can be complicating issues, however, as not everyone who works for a business is considered an “employee” for purposes of this requirement. For example, independent contractors are not employees, and therefore employers do not have to carry workers’ compensation insurance that would cover independent contractors or their work-related injuries. Employers will sometimes misclassify an employee as an independent contractor, which can result in harsh penalties for the business and its owner. Unfortunately, there is not a statutory definition of “independent contractor” that is applicable to workers’ compensation. Instead, California courts have set out a list of factors to consider. Although labor code section 3357 makes the presumption that a worker is an employee, courts will look at other realities to determine if this is accurate. The California Supreme Court adopted a test in S.G. Borello & Sons, Inc. v. Dept. of Industrial Relations that is still important law concerning how to determine if a worker is an employee or an independent contractor.

In Borello, the California Supreme Court was met with the question of whether agricultural workers who were engaged to harvest cucumbers through a “sharefarmer” agreement were independent contractors or employees. The Borello court created an “economic realities” test. Under this test, the most important issues is the control that the employer or principal may exercise over the worker. The focus on what kind of control pivots on not only the type of work that is to be done, but also the manner and way in which it is actually done. In other words, if the employer is telling a worker that he or she must perform the work during certain hours and in a certain location, it makes it more likely that worker is actually an employee, and not an independent contractor. There is  a long list of other factors to consider, including whether or not the type of work to be done is the type usually done by the employer, whether the work done requires a special skill set, and whether the worker is to be paid according to the job or the time spent.

If you have concerns or questions about properly classifying your employees, contact me today at (714) 516-8188. I look forward to answering your questions and discussing your business.

Homeowner Issues – Are My Handman And/Or Nanny Covered?

In today’s busy world, it is common for both partners in a relationship to work full time outside of the home. To help get things done around the house, it is very common for people to hire outside help. This comes in many forms, including a handyman for odd jobs or a nanny to care for the children. When a couple decides to hire outside help, they need to be careful about workers’ compensation requirements in California. California Labor Code sections 3351 and 3352 provide guidance for homeowners thinking of bringing in outside parties to assist with household tasks.

California law requires almost all employers to carry workers’ compensation insurance for their employees. Labor Code 3351 has a long list of those who are included under the definition of “employee,” and subsection (d) provides that anyone who is employed by a homeowner “whose duties are incidental to the ownership, maintenance, or use of the dwelling, including the care and supervision of children” is considered an employee for purposes of workers’ compensation. The statute does, however, specifically refer to a set of exceptions found in section 3352(h). These exceptions state that if the employee was employed for less than 52 hours in the 90 calendar days preceding the date of the injury or if the employee earned less than $100 from the employer during those 90 days, then the person is not an employee for purposes of workers’ compensation.

With this in mind, the homeowner needs to carefully consider the type and frequency of work being performed by a handyman or nanny. According to the definition, a person who helped put up a fence or paint a house would not fall under the definition of employee, as long as the job took 51 hours or less. Similarly, an occasional babysitter would also not fall under the definition of employee. The law is more aimed at the type of worker who is regularly and frequently inside the home, performing regular work for the homeowner. In other words, a nanny or au pair, as opposed to a babysitter, and a regular maintenance person as opposed to an occasional handyman. If you are employing someone who fits these parameters, you are likely required to carry workers’ compensation insurance.

I have extensive experience helping clients understand their obligations under California workers’ compensation, contact me today at (714) 516-8188 to talk about your options.

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