Gov. Signs Mostly Benign Workers’ Comp Legislation


No man’s life, liberty, or property are safe while the legislature is in session.”  Hon. Gideon J. TuckerIt is the end of another legislative year ending in with the governor’s review, signing or vetoing the work of the California Legislature.  This year there was more smoke than fire in the final analysis with the governor showing concern over the potential expenses bills might carry and also encouraging a broader negotiated result to modifications of the system rather than piecemeal changes.

Gov. Jerry Brown warned about the” veto blues” after the legislature’s passage of more than 600 bills. “You’ve given me 600 bills, and there’s not 600 problems that we need those solutions for,” the governor was quoted as saying.  His comments proved to be especially prophetic in the workers’ compensation arena as he signed a number of mostly non-controversial bills and vetoed most of the significant legislation with various veto messages indicating he was concerned about increasing costs and piecemeal reforms.

Thanks go to the California Workers’ Compensation Institute for its prompt dissemination of the below list of bills signed and vetoed.  The brief summaries are my own and the veto messages are edited portions lifted from the governor’s messages with the vetoed bills:

Bills Signed by Governor Brown:

• AB 335 by Assemblymember Jose Solorio (D-Santa Ana) – Workers’ compensation: notices.

Requires the Division of Workers’ Compensation administrative director with the Commission on Health and Safety and Workers’ Compensation to revise some DWC forms. Removes reference to vocational rehabilitation and substitutes supplemental job displacement voucher references. Eliminates need to send supplemental job displacement voucher NOPE by certified mail at end of temporary disability.

• AB 378 by Assemblymember Jose Solorio (D-Santa Ana) – Workers’ compensation: pharmacy products.

Provides imposition caps on compound drugs at 83% of generic for lowest price generic equivalent until the administrative director adopts a fee schedule.

• AB 397 by Assemblymember William W. Monning (D-Santa Cruz) – Workers’ compensation insurance: contractors.

Requires contractors to prove they are either exempt from coverage or have workers’ compensation coverage when renewing contractors’ licenses.

• AB 585 by Assemblymember Paul Fong (D-Mountain View) – Workers’ compensation: cancer presumption.

Extends existing cancer presumption in Labor Code § 3212.1 to Firefighters working at government installation.

• AB 1168 by Assemblymember Richard Pan (D-Sacramento) – Workers’ compensation: vocational expert fee schedule.
Requires the administrative director to adopt a fee schedule for vocational rehabilitation expert testimony by Jan. 1, 2013

• AB 1426 by Solorio – Workers’ compensation: court administrator.

Eliminates position of court administrator. This position is currently empty and the statutory provisions conflicted with the authority of the administrative director. The functions of the court administrator will be handled primarily through the administrative director’s office.

• SB 457 by Sen. Ronald Calderon (D-Montebello) –Workers’ compensation: liens.

Provides where an employee obtains medical treatment pursuant a medical plan provided by a self-insured employee welfare benefit plan reimbursement shall be determined notwithstanding the official Medical Fee Schedule adopted pursuant to Section 5307.1. Such liens shall be paid pursuant to the terms of the self-insured benefit plan not according to fee schedule.

• SB 684 by Senator Ellen Corbett (D-San Leandro) – Workers’ compensation insurance: dispute resolution: arbitration clauses.

Would allow California employers to arbitrate disputes under insurance policies that arise in California using California law even where the policy may have been written in a different state and provides for arbitration of disputes using another states law.

• SB 826 by Senator Mark Leno (D-San Francisco) –Workers’ compensation: data reporting requirement: administrative penalties.

Provides for imposition of administrative penalties where a claims administrator violates reporting requirements regulations.

Bills vetoed by Gov. Brown:

• AB 211 by Assemblymember Gil Cedillo (D-Los Angeles) – Workers’ compensation: permanent disability benefits. A veto message can be found here:

“This bill would have modified the provisions for providing the Supplemental Job Displacement Voucher from after the PD award till the end of TD. It would also have change the voucher amount to a flat $6000 rather than a structured amount based on the level of PD.”

• AB 584 by Assemblymember Paul Fong (D-Mountain View) – Workers’ compensation: utilization review. A veto message can be found here:

“This bill would have required physicians performing UR services be licensed to practice medicine in CA. The bill would have created different standards for WC UR than the same services in Group health.  The Governor was aware of the effort to impose this unique requirement in WC and did not consider a need to have different approaches in WC than from the rest of the health care industry.”

• AB 947 by Solorio – Workers’ compensation: temporary disability payments. A veto message can be found here:

“This bill would have extended the time for payment of TTD beyond the 104 limit in Labor Code § 4656 where the employee underwent surgery and the period of TD extended beyond the 104 weeks. This bill was amended near the end of the session to limit it to post-surgical cases in an effort to limit the potential expense attached to the changes to Labor Code § 4656.  As originally drafted it would have effectively eliminated the 104-week limitation on TTD.  The recent amendments provided significant limitation on the extension of TTD but the governor appeared concerned the amendments such as this should be part of an overall effort to modify the system and rather than piecemeal changes.”

• AB 1155 by Assemblymember Luis Alejo (D-Salinas) – Workers’ compensation. A veto message can be found here.

“This bill would have interposed additional language in Labor Code § 4663 ostensibly to prevent discrimination on the basis of “immutable characteristics” such as race, gender, sexual orientation etc.  The Governor’s message indicated the law already recognized similar protections and this provision would have potentially generated additional unnecessary litigation increasing employer costs with little corresponding additional protection to employees.”

The tenor of the governor’s messages suggest he is willing to extend additional benefits only if there are some offsetting savings. This was the same message offered by the new administrative director, Rosa Moran, at a presentation she made a few weeks ago at the well-attended California Workers’ Compensation & Risk Conference at Dana Point.

Remember, an optimist is merely one who believes we have the best of all possible workers’ compensation systems; a pessimist is merely one who fears that is true (Paraphrased from James Branch Cabell, The Silver Stallion, 1926)

Richard M. “Jake” Jacobsmeyer is a founding partner of the Shaw, Jacobsmeyer, Crain & Claffey workers’ compensation defense firm in Oakland.

California: Study points to continued increases in costs despite reforms        
Yet another research report indicates reforms adopted in California in the early 2000s are no longer effective in holding down medical costs. The latest study was issued by the California Workers’ Compensation Institute.
Like other reports issued in recent years, the newest data indicates medical costs have been rising for the last several years and have surpassed pre-reform levels. However, there is some indication that the rate of medical inflation may be slowing down.

New law stops bosses using credit info in hiring
Kathleen Pender  San Francisco Chronicle October 13, 2011
Employers can no longer request credit reports on certain employees or job candidates in California under a bill signed this week by Gov. Jerry Brown .

Employees at California’s Keck Medical Strike Over Staffing Decisions
Written by Jaimie Oh | October 12, 2011
Hundreds of Los Angeles-based Keck Medical Center employees began a one-day strike today, as the employees and the hospital work to agree to a contract, according to an LA Times report .

United Farm Workers to Celebrate 50 Years of Service to America’s Workers In 2012
KEENE, Calif., Oct. 14, 2011 /PRNewswire via COMTEX/ — Series of Events Commemorate Historic Anniversary of Organization Founded by Cesar Chavez
The United Farm Workers (UFW) announce today plans to celebrate the organization’s 50 years of service on behalf of the farm worker in America.  The organization founded by Cesar Chavez in 1962, will host a year-long celebration in 2012 with a series of events.  The UFW has partnered with the premier branding event agency LatinPointe to produce and promote the historic events.

State News: 10/14— victim of “polarized” politics, economy — Citing a lagging economy and “dramatically polarized political environment,” the head of California’s pioneering Center for Governmental Studies – which has provided research and analysis on Golden State governance and campaign finance for nearly three decades — says it will close Oct. 20, according to emails obtained by the Chronicle. Carla Marinucci Chronicle Politics  Patrick McGreevy LA Times PolitiCal  Torey Van Oot SacBee Capitol Alert

 — 10/14/11Prison hunger strike ends — At its peak, more than 4,000 inmates up and down the state were refusing meals in prisons from the Tehachapis to Pelican Bay. The strike, which began Sept. 26, followed one in July over conditions in the system’s high-security Security Housing Unit. Nicholas Riccardi LA Times PolitiCal

 — 10/14/11CalBuzz: And Now, a Brief Word About Poor People — Before we mercifully consign this week’s Republican presidential debate to the dustbin of obscure Google searches, it’s worth noting two brief, but politically significant, moments that slipped by with almost no coverage.  Jerry Roberts and Phil Trounstine CalBuzz

   — 10/14/11Fleischman: Brown Talks About Public Employee Pension Reform, But Can He Deliver? — Yesterday in Los Angeles at an event with famed philanthropist and felon Michael Milken, Governor Jerry Brown said that he would soon be releasing details of his own pension reform plan, adding that his proposal will include a constitutional amendment and by necessity be put in front of the voters for approval.  Jon Fleischman Flash Report  — 10/14/11