Jennifer Callan Callan Law Firm 1100 Lincoln Avenue, Suite 261 San Jose, CA T: Daniel Muller, Esq. Slater, Hersey & Lieberman 160 West Santa Clara Street, Suite 1575 San Jose, CA T: Case Law Update Francis Stevens v. WCAB, Outspoken Enterprises et al. (October 2015) 241 Cal. App. 4 th 1074; 80 CCC 1262 [Court of Appeal, 1 st Appellate District] Background: In 2004, legislation took effect in workers compensation which required all medical treatment requests by injured workers to go through an evaluation process called Utilization Review (UR). Under the UR process, a request for medical treatment is either certified as medically appropriate, or denied as medically unnecessary. Under the UR process, an injured worker can challenge decisions denying the requested treatment, but employers cannot challenge the decisions approving it. Case Law Update Francis Stevens v. WCAB, Outspoken Enterprises et al. (October 2015) 241 Cal. App. 4 th 1074; 80 CCC 1262 [Court of Appeal, 1 st Appellate District] In 2013, additional reforms went into effect which established a new procedure, Independent Medical Review (IMR) to resolve injured workers challenges to UR decisions. The IMR is performed by an independent review organization (Maximus Federal Services), which assigns medical professionals to review pertinent medical records and reports and other information submitted from the parties. The name/identity of the IMR physician reviewer is kept confidential and is undisclosed in the final IMR determination. Case Law Update Francis Stevens v. WCAB, Outspoken Enterprises et al. (October 2015) 241 Cal. App. 4 th 1074; 80 CCC 1262 [Court of Appeal, 1 st App. District] An injured worker who disputes the IMR determination may appeal it to the Board, however, under Labor Code 4610.6(h), there are limited specified grounds for which relief can be sought, such as (1) the Administrative Director acted without or excess of its powers; (2) the decision was procured by fraud; (3) the physician reviewer had a material conflict of interest; (4) the decision was the result of bias; or (5) the decision was based on a plainly erroneous fact that is not a matter subject to expert opinion. Mr. Stevens (and the Applicants Bar) assert the IMR process violates their state Constitutional rights. Holding: CA Court of Appeal upheld the constitutionality of the Independent Medical Review (IMR) process. Status: At years end, it was uncertain whether the CA Supreme Court would grant review of this case. Case Law Update Angelotti Chiropractic v. Baker, (June 2015) 80 CCC 672 [9th Circuit Court of Appeals] Under Labor Code , every lien claimant must pay a lien activation fee of $ for each pending workers compensation lien filed prior to January 1, 2013 at the time a DOR is filed for a Lien Conference. [Note: This section does not apply to any lien filed by a health care service plan, a group disability insurer or EDD]. Plaintiff Angelotti and other lien claimants sued the Director of the Department of Industrial Relations (DIR) alleging violation of the U.S. Constitution. U.S. District Court Judge George Wu issued a preliminary injunction against enforcement of the activation fees on equal protection grounds which became effective on November 19, 2013. Case Law Update Angelotti Chiropractic v. Baker, (June 2015) 80 CCC 672 [9th Circuit Court of Appeals] Following the ruling by the 9 th Circuit Court of Appeals, Judge Wu issued an order vacating the preliminary injunction and permitting lien claimants to pay activation fees from 11/19/15 until 12/31/15. The lien activation fees [for pending lien claims filed prior to 1/1/13] must be paid by 12/31/15 or the affected lien will be dismissed by operation of law. Holding: The U.S. Court of Appeals 9 th Circuit upheld the constitutionality of lien activation fees on June 29, 2015. Case Law Update Douglas OConnor, et al. v. Uber Technologies, Inc., (March 2015) 80 CCC 345 [U.S. District Court for the Northern District of CA] The case was brought by three Uber drivers who believe they should be treated as employees not independent contractors and are requesting reimbursement for their expenses such as fuel and insurance, as well as unpaid tips. Defendant, Ubers position is that their drivers are independent contractors and not entitled to the protection of the CA Labor Code. Moreover, the drivers set their own hours and work schedules, provide their own vehicles and are subject to little direct supervision. Uber further contends that it is not a transportation company, but instead is a pure technology company that generates leads for its transportation providers through its software i.e. a technology intermediary between potential riders and potential drivers. Case Law Update Douglas OConnor, et al. v. Uber Technologies, Inc., (March 2015) 80 CCC 345 [U.S. District Court for the Northern District of CA] Holding: The Court held that Plaintiffs, drivers for Uber are presumptive employees because they perform services for the benefit of Uber. Whether an individual should ultimately be classified as an employee or an independent contractor under California law presents a mixed question of law and fact that must typically be resolved by a jury. Because a number of facts material to the employee/independent contractor determination remain in dispute, the Court denied Ubers Motion for Summary Judgement. Case Law Update Douglas OConnor, et al. v. Uber Technologies, Inc., (March 2015) 80 CCC 345 [U.S. District Court for the Northern District of CA] In finding Plaintiffs are Ubers presumptive employees, the Court stated that it was obvious the drivers perform a service for Uber because Uber simply would not be a viable business entity without its drivers and that Ubers revenues do not depend on the distribution of its software, but on the generation of rides by its drivers. The Court also noted Uber exercises significant control over the amount of any revenue it earns and that Uber also exercises substantial control over the qualification and selection of its drivers. The Court also relied on case law, and in particular, the case of Yellow Cab Cooperative, Inc. v. WCAB, (1991) 56 CCC 34, which explained that under California law there is a presumption that a service provider is presumed to be an employee unless that principal affirmatively proves otherwise. Status: Trial has been scheduled for June 20, 2016 in the U.S. District Court. Regulatory Changes New Mileage Reimbursement Rate On 12/18/15, the DWC announced the mileage rate for medical and medical-legal travel expenses decreases effective 1/1/16 from.575 cents per mile (rate for mileage paid after 1/1/15) to.54 cents per mile. Regulatory Changes Revised Supplemental Job Displacement Benefit (SJDB) Voucher Form On 12/1/15, the DWC posted a revised Supplemental Job Displacement Benefit voucher form on its website to conform to Title 8, California Code of Regulations The Return-to-Work Supplement Program makes supplemental payments to workers whose permanent disability benefits are disproportionately low in comparison to their earning losses. To be eligible for the fund, an applicant must have a date of injury on or after 1/1/13 and have received a SJDB voucher. Under Regulation 17308, the amount of payment from the fund is $5, to each eligible injured worker. Information has been added to the first page of the voucher form regarding eligibility for the Return- to-Work Supplement. Injured worker must apply within one-year from the date of service of the voucher and the application must be filed electronically/online through the DIR website. Regulatory Changes Reinstatement of Lien Activation Fees on 11/19/15 per Angelotti. Regulatory Changes New Online QME Panel Request Form effective 10/1/15 Applies to an initial panel request on represented cases only with a date of injury on or after 1/1/05. Requires parties in a represented case to submit initial QME panel requests online [at:and immediately receive a QME Panel. The requesting party must then serve a copy of the online request, the panel list and a copy of any supporting documentation upon the opposing party with a proof of service within 1 (one) working day after generating the QME panel list.www.dwc.ca.gov Regulatory Changes Temporary Total Disability Rates for 2016 As of 1/1/16, the minimum and maximum temporary total disability (TTD) rates have increased. Minimum TTD rate will increase from $ to $ per week Maximum TTD rate will increase from $1, to $1, per week Labor Code 4453(a)(10) requires the rate for TTD be increased by an amount equal to the percentage increase in the State Average Weekly Wage (SAWW) as compared to the prior year. Regulatory Changes Final Copy Service Fee Schedule Regulations Effective 7/1/15, the DWCs final version of the Copy Service Fee Schedule was approved by the Office of Administrative Law (OAL). The Copy Service Fee Schedule regulations include: Instead of a per-page fee and itemized fees for subpoena preparation, mileage, and other related fees, a flat fee of $ covers records of 500 pages and under and includes mileage, postage, delivery, phone calls, page numbering, witness fees, release of information fees and subpoena preparation costs. Separate charges are allowed for cancellations, certificate of no records, for records obtained from EDD and WCIRB, and for additional sets of records. For copies above 500 pages, an additional.10 cents per page is allowed. CUMULATIVE TRAUMAS Kendall v. Open Wave Systems, Inc., APIC (August 2012) 2012 Cal. Wrk. Comp P.D. LEXIS 159 [Panel] Travelers sought contribution from American Protection Ins. Co. (APIC). An arbitrator found that there was one CT extending through June 7, 2004 and that Travelers was entitled to contribution from APIC. APIC filed a Petition for Reconsideration. The sole issue before the court was the determination of the CT period. Mr. Kendall was treated for bilateral hand/wrist pain and numbness in May At that time he was told to cut back on work hours, but he did not. He did wear wrist braces outside of work and took medication. On July 19, 2004, Mr. Kendall filed a DWC-1 claim for BCTS. TD began on September 30, The WCAB amended the F&A to find that the period of liability for the CT was through September 29, The WCAB noted that liability for a CT is determined according to the last year preceding either the DOI (Labor Code 5412) or the last date on which the employee was employed with injurious exposure. (Labor Code ) CUMULATIVE TRAUMAS Kendall v. Open Wave Systems, Inc., APIC (August 2012) 2012 Cal. Wrk. Comp P.D. LEXIS 159 [Panel] Labor Code 5412 defines CT injury as that date upon which the employee first suffered disability therefrom and either knew or in the exercise of reasonable diligence should have known that such disability was caused by his present or prior employment. Disability in this context means either TD or PD. Mr. Kendall was not found to have suffered PD by the WCAB as he did not reduce his work hours or work modified duty. The WCAB then analyzed when Mr. Kendall first suffered TD, which it found to be September 30, Holding: Since the DOI under Labor Code 5412 was September 30, 2004, and the last day of injurious exposure was Applicants LDW on September 29, 2004, it is appropriate to use the earlier of these two dates and find that the CT ends on September 29, 2004. Psychiatric Claims No compensable consequence psyche permanent impairment add-on to a physical injury for DOIs on or after 1/1/13, absent limited exceptions, namely, being a victim of a violent act or direct exposure to a significant violent act within the meaning of LC , or a catastrophic injury. (Labor Code Section (c).) Labor Code Section Good Faith Personnel Defense 6 Month of Employment Defense Sudden & Extraordinary Exception Psychiatric Claims Labor Code Section Good Faith Personnel Defense: Hybrid medical & legal criteria What is to be addressed by Medical-Legal Evaluator? What is to be addressed by Workers Compensation Judge? Psychiatric Claims Labor Code Section Good Faith Personnel Defense What is to be addressed by Medical-Legal Evaluator? Psyche diagnosis meeting requisite criteria. Whether or not psyche injury was predominantly (> 50%) caused by work activities. Whether psyche injury was substantially (at least 35% to 40%) caused by events/actions which the WCJ deems to be personnel actions Psychiatric Claims Labor Code Section Good Faith Personnel Defense What is to be addressed by Workers Compensation Judge? Psychiatric Claims San Francisco Unified School District v. WCAB (Cardozo) (2010) 190 Cal.App.4 th 1 When a psychiatric injury is alleged and the good faith personnel action defense is asserted, the Workers Compensation Judge must make the following determinations: Whether the alleged psychiatric injury involves actual events of employment; Whether competent medical evidence establishes the required percentage of industrial causation, i.e., whether the predominant cause [i.e., greater than 50%] standard has been met; Whether any of the actual employment events were personnel actions; Psychiatric Claims San Francisco Unified School District v. WCAB (Cardozo) (2010) 190 Cal.App.4 th 1 Whether the personnel actions were lawful, nondiscriminatory, and made in good faith; Whether competent medical evidence establishes that the personnel action or actions are a substantial cause, accounting for at least 35 to 40 percent of the psychiatric injury as defined by Labor Code Section (b)(3). When read together, the plain meaning of Labor Code Section (b)(3) and Labor Code Section (h) is that the entire set of industrial and non- industrial causal factors must be taken into consideration in determining whether or not a psychiatric injury was substantially caused by good faith personnel actions. Psychiatric Claims 6 Months of Employment Defense Sudden & Extraordinary Exception General & Special Employment Calculation of 6 Months Psychiatric Claims Aguirre v. Ekim Painting North, Inc. Redwood Fire & Casualty Ins. Co., (August 25, 2014) ADJ [split WCAB panel decision] On 12/1/08, applicant sustained an industrial injury when he fell two stories from the roof of a building which he was preparing for painting. He alleged injuries to his back, neck, jaw, chest, left upper extremity, left elbow and psyche. The matter proceeded to trial on the issues of (1) six months of employment and (2) sudden and extraordinary employment condition. The parties stipulated that applicant worked for the employer from 9/16/08 through the date of injury of 12/1/08 (77 days). Applicant was then temporarily disabled until he returned to work from 9/15/09 through 10/26/09 (42 days). Applicant sought reconsideration of the WCJs finding that determined his alleged psychiatric injury was non-compensable based upon the Six Month Rule, and that the injury was not caused by a sudden and extraordinary employment condition. Psychiatric Claims Aguirre v. Ekim Painting North, Inc. Redwood Fire & Casualty Ins. Co., (August 25, 2014) ADJ [split WCAB panel decision] Holding re: Six Months Employment Pursuant to Wal-Mart Stores v. WCAB, (2003) 68 CCC 575, applicant is not entitled to credit for the time he was off work from 12/2/08 through 9/14/09 [while he was TTD]. Applicant did not perform actual service for the employer for six months as required by L.C. 3208.3(d), and therefore, he was not employed for six months by this employer. Psychiatric Claims Aguirre v. Ekim Painting North, Inc. Redwood Fire & Casualty Ins. Co., (August 25, 2014) ADJ [split WCAB panel decision] Holding re: Sudden & Extraordinary Per Matea v. WCAB (2006) 71 CCC 1522, the Sixth District Court of Appeal held that if an employee carries his/her burden of showing by a preponderance of evidence that the event or occurrence that caused the alleged psychiatric injury was something other than a regular and routine employment event or condition, that is, that the event was uncommon, unusual, and occurred unexpectedly, the injury may be compensable even if the employee was employed for less than six months. Here, applicant met burden of showing that alleged psychiatric injury resulted from an incident that was unusual, uncommon and unexpected or sudden and extraordinary based upon his unrebutted testimony that in his 8-9 years working as a painter at similar heights he never before fell or lost footing, coupled with the traumatic nature of his injury and defendants failure to produce any evidence indicating that applicants fall was routine or ordinary employment condition. Psychiatric Claims Aguirre v. Ekim Painting North, Inc. Redwood Fire & Casualty Ins. Co., (August 25, 2014) ADJ [split WCAB panel decision] Dissenting Opinion of Commissioner Lowe re: Sudden & Extraordinary To allow applicant to satisfy the sudden and extraordinary exception simply by testifying that he was not aware of any other painters failing off of ladders or scaffolding represents an unreasonably broad interpretation and an unwarranted expansion of the exception. Applicants accident, though terrible, is part of the hazards of performing work above ground level and cannot be said to be extraordinary within the meaning of L.C. 3208.3(d). Psychiatric Claims Martinez v. Mass Precision, Comp West Ins. Co., Balance Staffing Service, Zurich North America (October 21, 2014) ADJ , ADJ [WCAB panel decision] Defendant, Balance Staffing Service (general employer) sought reconsideration of WCJs decision finding applicant sustained both a specific injury on 11/30/09 and a cumulative trauma injury over the period ending 11/30/09 to her lumbar spine, right shoulder and psyche while employed as a part maker by Mass Precision (special employer) and the Balance Staffing Service (general employer). Applicant was employed directly by Mass Precision from 3/17/08 to 3/12/09, and later worked at Mass Precision, employed by the defendant, general employer, from 6/19/09 to 11/30/09. Defendant, general employer, contends applicants claim for psyche is barred under L.C. 3208.3(d), since applicant was employed for Balance Staffing Service for less than the requisite minimum six month period under the statute. Psychiatric Claims Martinez v. Mass Precision, Comp West Ins. Co., Balance Staffing Service, Zurich North America (October 21, 2014) ADJ , ADJ [WCAB panel decision] Issue: Whether, when there is dual employment, the general employer may be liable for a claim of injury to the psyche while working at the special employer if the general employer employed the injured worker for less than six months? Holding: In Martinez v. Tarrant Apparel dba Fashion Resource, 2010 Cal. Wrk. Comp. PD. Lexis 192, it was held that an applicants claim of injury to her psyche was not barred by the six month requirement, though the special employer held liable had employed the injured worker for less than six months. Psychiatric Claims Martinez v. Mass Precision, Comp West Ins. Co., Balance Staffing Service, Zurich (October 21, 2014) ADJ , ADJ [WCAB panel decision] Holding [contd]: Per Martinez, the plain language of section (d) supports the conclusion that applicant was employed by the special employer for more than six months on the date of injury. Moreover, it has long been held that an employee may have more than one employer at the same time. The characteristics of such dual employment are 1) that the employee is sent by one employer (the general employer) to perform labor for another employer (the special employer); 2) rendition of the work yields a benefit to each employer; and 3) each employer has some direction and control over the details of the work. Applying Martinez, the WCAB found that where section (d) requires that the employee has been employed by that employer for at least six months, it extends the requisite employment period in situations of dual employment to the entire period of employment by both the general and special employers. Dissent distinguishes Martinez case applicant was employed by Mass Precision, as a special employee and as a regular employee. However, here, applicant was only employed by Balance Staffing Service as a general employee, and had no relationship with applicant other than for the period from 6/19/09 to 11/30/09. Labor Code Section 132a Any employer who discharges, or threatens to discharge, or in any manner discriminates against any employee because he or she has filed or made known his or her intention to file a claim for compensation with his or her employer or an application for adjudication, or because the employee has received a rating, award, or settlement... Remedies: Back pay, back benefits, and reinstatement; Penalty of 50% of the compensation furnished not to exceed $10,000 Costs not to exceed $250 Criminal prosecution Punitive damages? (See City of Moorpark) 132a Discrimination Claims Dept. of Rehabilitation v. WCAB (Lauher) (2003) 68 CCC 831 [California Supreme Court] Employee bears the burden of proof that the employer violated Labor Code Section 132a and must show: Existence of the claimed injury; Employer knowledge of the claimed injury; Adverse action impacting the employee on account of the claimed disability; and The action was detrimental in removing a benefit of the employment which would otherwise have been available to similarly situated employees, i.e., the employee was singled out for adverse treatment. 132a Discrimination Claims Dept. of Rehabilitation v. WCAB (Lauher) (2003) 68 CCC 831 [California Supreme Court] In the event the injured worker is successful in meeting all of the criteria listed above, the burden then shifts to the employer to demonstrate that the detrimental act was required for a legitimate business purpose. 132a Discrimination Claims City of Moorpark v. Superior Court (Dillon) (1998) 63 CCC 944 [California Supreme Court] Labor Code Section 132a is not the exclusive remedy for discrimination based on work related disabilities. An injured worker may bring a discrimination claim before the WCAB under Labor Code Section 132a as well as actions in state court under the FEHA and for common law wrongful discharge. Remedies of the FEHA and common law tortious wrongful discharge based on violation of public policy, in addition to L.C. Section 132a, are available to employees who assert discrimination attributable to a disability resulting from an injury arising out of and occurring in the course of employment. 132a Discrimination Claims Gelsons Markets Inc. v. WCAB (Fowler) (2009) 74 CCC 1313 Fowler injured his neck and was taken off of work by his treating physician on August 3, Medical reports from Fowlers treating physician and the AME were unclear and ambiguous regarding Fowlers ability to return to his usual and customary job duties. In his deposition in December 2006, the AME concluded that Fowler could probably perform his U&C position. Defendant returned Fowler to work on January 8, Fowler alleged a violation of Labor Code 132a. At Trial, Fowler presented no evidence that defendant treated him disadvantageously because of his industrial injury, as compared to how defendant treated any non-industrially injured employee. 132a Discrimination Claims Gelsons Markets Inc. v. WCAB (Fowler) (2009) 74 CCC 1313: Holding: Fowler failed to satisfy the test established in Department of Rehabilitation v. WCAB (Lauher) (2003) 30 Cal.4 th 1281, 68 CCC 831, for making a prima facie showing of discrimination. WC & Civil Cross-over Dufresne v. City of Hayward (2009) Alameda Superior Court No (Unpub.) Dufresne filed a workers compensation claim against the City of Hayward for stress, depression, anxiety [and] paranoia due to prolonged discrimination [and] harassment. The City accepted liability for the workers compensation claim and provided benefits. During the course of the Trial of Dufresnes civil Complaint against the City for sexual harassment, evidence was admitted regarding the workers compensation claim, including the Citys acceptance of liability for the claim. Jury returned a verdict in favor of Dufresne, awarding her $472, on her complaint for sexual harassment against the City. The City appealed, arguing that the court erred in admitting evidence that the city accepted liability in WC proceedings arising out of the same alleged harassment. WC & Civil Cross-over Dufresne v. City of Hayward (2009) Alameda Superior Court No (Unpub.) Holding: Evidence of what transpired in the workers compensation proceedings was admissible in the civil trial. When the City admitted that Dufresnes workers compensation claim was compensable, it was necessarily acknowledging that Dufresne had presented sufficient objective evidence of harassment and that the harassment was the predominate cause of her injury. WC & Civil Cross-over Jackson v. County of Los Angeles (1997) 60 Cal.App.4 th 171 [Court of Appeals, 2 nd Appellate District] Judicial estoppel applied to preclude an ADA claim when the work restrictions included within an applicants workers compensation award established the individual unqualified for continued employment with the employer. Global Settlements Steller v. Sears, Roebuck and Co. (2010) 189 Cal.App.4 th 175 Whether an Offer to Compromise under CA CCP Section 998 purporting to resolve both a civil disability discrimination claim and a workers compensation claim was sufficient to resolve both pending actions? Settlements of workers compensation claims must be approved by the WCAB to be effective. No release of liability or compromise agreement regarding a workers compensation matter is valid unless it is approved by the appeals board or referee. (Labor Code 5001) [Note: Employers seeking concurrent resolutions should ensure the settlement documents expressly provide for, and make payment conditioned upon, WCAB approval of the workers compensation settlement.]