Volume 1, Issue 5                                                 The Martin Newsletter                                                   June 2007

WORKERS’ COMPENSATION JUDGE THROWS OUT ADMINISTRATION’S PERMANENT DISABILITY CUTS:

Permanent Disability Compensation Cuts “Arbitrary,” “Disturbing,”

 “No Rational Explanation” for Administration’s Cuts

SACRAMENTO - Advocates for injured workers today reported that a Judge of the Workers’ Compensation Appeals Board has invalidated the Schwarzenegger Administration’s deep cuts in injured workers’ permanent disability compensation.  The advocates for Californians injured on the job hailed Workers’ Compensation Appeals Board (WCAB) Judge Jacqueline Duncan’s May 9 decision in the case of injured worker Scott Boughner vs. Comp USA and Zurich North America.  “The court’s decision affirms that the administration’s schedule violates the legislative mandate of Labor Code Section 4660, and is not based on empirical data.  We call upon the Legislature to enact a statute that ensures restoration of adequate benefits to permanently disabled workers,” said California Applicants’ Attorneys Association (CAAA) President Linda Atcherley.  “We have repeatedly asked the administration to overturn the drastic reduction in the already-meager compensation permanently injured workers receive.  Today, we renew that call based upon the court’s decision.”

The judge’s 56-page decision specifically found that:

“The Administrative Director failed to base the adjusted rating schedule on empirical data and findings…” (Page 2) and “[T]he AD acted arbitrarily and in violation of the requirements of the statute in unilaterally terminating all efforts to obtain sufficient empirical data.” (Page 49)

Four studies, including one by the insurance industry’s own ratings bureau, have found the Schwarzenegger Administration’s ratings reduce compensation to permanently disabled workers by more than half.  A UC Davis professor conducted one; another was by the State’s own Commission on Health, Safety and Welfare Compensation (CHSWC); yet another was by an insurance defense expert; and the fourth was from the insurance carriers’ own ratings bureau.  The studies have consistently shown the Schwarzenegger Administration’s schedule will reduce permanent disability compensation by an average of 50% to 70%.  “The court has agreed with us that the Administration failed to link the new permanent disability ratings to wage loss by using empirical data and findings.  Instead, the Administration substituted policy judgments for empirical data and assumptions for empirical studies.  Nowhere does the law give the Administration authority to make a ‘policy decision’ that severely reduces permanent disability benefits to injured workers.”  As Sen. Sheila Kuehl noted during that hearing, “SB899 does not grant authority for this overall reduction of benefits.”

Fighting For Injured Workers' Rights in California

Thomas F. Martin
Professional Law Corporation
2107 North Broadway, Suite 206
Santa Ana, California  92706
(714) 547-5025
www.thomasfmartinplc.com

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