CALIFORNIA COMPENSATION CASES
Vol. 88, No. 5 May 2023
A Report of En Banc and Significant Panel Decisions of the WCAB and Selected Court Opinions of Related Interest, With a Digest of WCAB Decisions...
By Hon. Susan V. Hamilton, Former Assistant Secretary and Deputy Commissioner, California Workers’ Compensation Appeals Board
In 2022 there were 7,490 wildfires in California. They burned 362,455 acres...
By Christopher Mahon
Should temporary workers be treated separately under workers’ compensation law due to additional employment and income risks they may incur after workplace injuries? A new study...
Here's a noteworthy panel decision where a family member conveyed essential information to the AME on behalf of the injured employee. The Lexis headnote is below.
CA - NOTEWORTHY PANEL DECISIONS...
Oakland, CA – Part II of a California Workers’ Compensation Institute (CWCI) research series on low- volume/high-cost drugs used to treat California injured workers identifies three Dermatological drugs...
Two Recent WCAB Panel Decisions and Key Issues to Consider Based on Evolving Case Law
By Raymond F. Correio, Esq.
Given the fact that settlement of Supplemental Job Displacement Benefits (SJDB) in the form of vouchers is generally not permitted except in very limited circumstances, an applicant’s right to claim SJDB vouchers after settlement of a case either by a Compromise and Release or Stipulated Award remains a constant thorn in the side of employers, claims professionals and defense counsel. Think of a defendant not being able to close a claims file except perhaps provisionally and having to maintain a $6,000 reserve for an indeterminate period of time to cover any claim related to an SJDB voucher!
The Beltran Decision and Potential Settlement of SJDB Vouchers in Limited Circumstances: Beltran v. Structural Steel Fabricators (2016) 81 Cal.Comp.Cases 1224, 2016 Cal. Wrk. Comp. P.D. LEXIS 366 (Appeals Board noteworthy panel decision) permits the settlement of SJDB voucher benefits in very limited circumstances “where the trier of fact makes an express finding based upon the record that a serious and good faith issue exists to potentially defeat a right to workers’ compensation benefits altogether to justify a release, a compromise and release agreement may be approved by the Board which will relieve the employer from liability for a Supplemental Job Displacement voucher.”
The main problem with the Beltran decision is that as a panel decision it is not binding but only persuasive authority on the issue and therefore WCJ’s or other WCAB panels may choose not to approve proposed settlements of SJDB vouchers even in situations where the record indicates the existence of a serious good faith issue to justify such a release.
While the WCAB’s en banc decision in Dennis v. State of California (2020) 85 Cal.Comp.Cases 389, 2020 Cal. Wrk. Comp. LEXIS 19 (Appeals Board en banc) dealing with an SJDB voucher provides useful guidance, there are myriad fact patterns related to SJDB voucher claims that inevitably lead to ongoing litigation.
Recent WCAB Panel Decisions: Two recent WCAB panel decisions, Schmidt v. Fremont Swim School, 2022 Cal. Wrk. Comp. P.D. LEXIS -- and Sanchez v. Forever 21, Inc., 2022 Cal. Wrk. Comp. P.D. LEXIS -- involved the issue of whether applicants were entitled to SJDB vouchers. Both cases are good reminders that the issue of claims by applicant’s for SJDB vouchers will be ongoing into the foreseeable future. These cases also reflect that SJDB voucher cases are both fact specific and fact intensive.
The Schmidt Case: The Schmidt panel decision issued on 12/7/22. Applicant suffered an admitted injury and had hernia surgery shortly thereafter. Following surgery, applicant returned to work, but with modified duties. However, he had problems performing modified duties and he voluntarily resigned just short of three years after returning to work. The reporting PQME based on a strict AMA Guides rating analysis found 0% permanent disability but based on an Almaraz/Guzman rating analysis found 10% WPI. Following trial, the WCJ found that applicant was not entitled to the SJDB voucher based on a lack of substantial medical evidence related to an allegedly flawed Alamaraz/Guzman analysis by the PQME resulting in 10% WPI.
Applicant filed for reconsideration which was granted by the WCAB who rescinded the WCJ’s Findings of Fact and remanded the case back to the trial level for further proceedings. In reversing the WCJ, the WCAB’s decision contains an extensive discussion of Almaraz/Guzman and why the PQME’s opinion did constitute substantial medical evidence as to the applicant’s 10% WPI finding. In part the WCAB stated:
Here, Dr. Davidson explained that a strict application of the AMA Guides results in applicant having a 0% WPI because applicant no longer has a palpable defect or hernia due to surgical treatment. (Applicant Exhibit 1, Dr. Davidson report dated December 3, 2019, p. 8.) However, applicant does have surgical scarring and constant persistent pain. (Id. at p. 9.) Dr. Davidson did not believe that a strict application of the AMA Guides is an accurate depiction of applicant’s permanent impairment. (Ibid.) Dr. Davidson identified Class 2 from Table 6-9 as the most accurate description of applicant’s permanent impairment, resulting in a rating of 10% WPI. (Ibid.) In other words, Dr. Davidson provided an explanation as to why he deviated from the Permanent Disability Schedule, stayed within the AMA Guides framework, and used his judgment, experience, training and skill to determine a more accurate WPI for applicant. This is exactly what Almaraz/Guzman II required him to do. Therefore, we find his reasoning and conclusions to be substantial medical evidence.
The WCAB also provided guidance to the WCJ and the parties on remand with respect to an applicant’s claim for an SJDB voucher as well as the defense burden of proof related to an SJDB voucher.
Lastly, considering the arguments in the Petition, we provide the following guidance with respect to applicant’s claim for a SJDB voucher. Applicant is entitled to a SJDB voucher upon showing that he sustained permanent partial disability and the employer failed to show that it offered regular, modified, or alternative work, regardless of whether the record contains a Physician’s Return to Work & Voucher Report. (§§ 4658.7(b), 5705; Opus One Labs v. Workers' Comp. Appeals Bd. (Fndkyan) (2019) 84 Cal. Comp. Cases 634, 636 [2019 Cal. Wrk. Comp. LEXIS 51] (writ denied) [the burden of proof remains with defendant to show that it offered regular, modified or alternative work, irrespective of whether defendant received a Physician’s Return to Work & Voucher Report so long as defendant was apprised of applicant’s permanent disability status and work preclusions].)
Moreover, applicant’s resignation has no bearing on his entitlement to a voucher. (Dennis v. State of California (April 30, 2020) 85 Cal.Comp.Cases 389, 406 [2020 Cal. Wrk. Comp. LEXIS 19] (Appeals Board en banc) [“Thus, absent a bona fide offer of regular, modified, or alternative work, regardless of an employer's ability to make such an offer, and regardless of an employee's ability to accept such an offer, an employee is entitled to a SJDB voucher.”])
The Sanchez Case: The WCAB’s decision in Sanchez issued on 12/5/22. Defendant filed for reconsideration of a WCJ’s Order that they were to provide applicant with an SJDB voucher and also pay reasonable attorney’s fees but deferring the issue of penalties and sanctions. The WCAB granted reconsideration and rescinded the WCJ’s Order based on the WCJ’s failure to comply with Labor Code 5313 and Blackledge v. Bank of America (2010) 75 Cal.Comp.Cases 613, 2010 Cal.Wrk.Comp. LEXIS 74 (Appeals Board en banc), by failing to state the required reasons or grounds upon which the WCJ’s determinations were made.
The Board remanded the case for further proceedings and provided an extensive discussion and analysis of the most relevant controlling case law that should provide a useful roadmap for the bench and bar to follow in future cases in order to properly assess an applicant’s claim for an SJDB voucher and the respective burdens of both parties in that regard.
Nevertheless, in light of the parties’ arguments, we provide the following guidance with respect to applicant’s claim for a SJDB voucher. Applicant is entitled to a SJDB voucher upon showing that she sustained permanent partial disability and the employer failed to show that it offered regular, modified, or alternative work, regardless of whether the record contains a Physician’s Return to Work & Voucher Report. (§§ 4658.7(b), 5705.) In Opus One Labs v. Workers' Comp. Appeals Bd. (Fndkyan) (2019) 84 Cal. Comp. Cases 634, 636 [2019 Cal. Wrk. Comp. LEXIS 51] (writ denied), a different Appeals Board panel concluded that:
We are persuaded by applicant’s contention here that, in this instance, defendant had the burden to obtain a Physician’s RTW form when defendant was apprised of applicant’s permanent disability status and work preclusions in the QME report. The purpose of a Physician’s RTW form is to inform defendant that applicant has become permanent and stationary, the industrial injury caused permanent partial disability, and of applicant’s work capacities and restrictions. (Lab. Code, § 4658.7(b)(1), (h)(2); Cal. Code of Regs., tit. 8, § 10133.31(b).) The QME report here provided this information. To conclude otherwise would place form over substance. (County of Kern v. T.C.E.F, Inc. (2016) 246 Cal. App. 4th 301, 321, 200 Cal. Rptr. 3d 714 [“A general principle of statutory construction is that courts do not place form over substance where doing so defeats the objective of a statute, especially a statute designed to protect a public interest. (citations omitted.) It is an ‘established principle of the law that the substance and not the mere form of transactions constitutes the proper test for determining their real character. If this were not true it would be comparatively simple to circumvent by sham the provisions of statutes framed for the protection of the public. This the law does not permit.’ (citations omitted).”]; Pulaski v. American Trucking Associations, Inc. (1999) 75 Cal. App. 4th 1315, 1328 [64 Cal. Comp. Cases 1231, 1236] [“Substantial compliance, as the phrase is used in the decisions, means actual compliance in respect to the substance essential to every reasonable objective of the statute . . . . Where there is compliance as to all matters of substance technical deviations are not to be given the statute of noncompliance. . . . Substance prevails over form. (citations omitted.)” (internal quotations omitted [by WCAB]; emphasis in original.)].) [Citations to record omitted]
We agree. The burden of proof remains with defendant to show that it offered regular, modified or alternative work, irrespective of whether defendant received a Physician’s Return to Work & Voucher Report.
Moreover, the offer of regular, modified or alternative work must be bona fide. In Dennis v. State of California (April 30, 2020) 85 Cal.Comp.Cases 389 [2020 Cal. Wrk. Comp. LEXIS 19] (Appeals Board en banc), we held that,
Our review of statutes and case law, however, leads us to conclude that an employer's inability to offer regular, modified, or alternative work does not release an employer from the statutory obligation to provide a SJDB voucher. (§ 4658.7(b).) “Labor Code section 3202 requires the courts to view the Workers' Compensation Act from the standpoint of the injured worker, with the objective of securing the maximum benefits to which he or she is entitled.” (Rubalcava v. Workers' Comp. Appeals Bd. (1990) 220 Cal.App.3d 901, 910 [269 Cal.Rptr. 656, 55 Cal.Comp.Cases 196].) Thus, absent a bona fide offer of regular, modified, or alternative work, regardless of an employer's ability to make such an offer, and regardless of an employee's ability to accept such an offer, an employee is entitled to a SJDB voucher. (Dennis, supra, 85 Cal. Comp. Cases at 406.)
Key Points to Consider When Dealing With SJDB Voucher Entitlement Litigation
Copyright © 2022 Raymond F. Correio, Workers’ Compensation Judge (Retired), Pearlman, Brown & Wax, L.L.P. All rights reserved. Reprinted with permission.