Tuesday, August 2, 2011

Work Comp Complexity - Just Part of Life

Workers' compensation law is so complex, even the higher courts don't understand it, or get it right.

That appears to be the sentiment following Friday's release by the California First District Court of Appeal's opinion in Ogilvie.

The injured worker's attorney, Mark Gearheart, told WorkCompCentral, "I think it's likely that this decision will not end the litigation and confusion about how to use future earning capacity evidence, but will engender another round as the parties try to do it again. The battle will go on."

And the defense bar is also decrying the court's seeming lack of sophistication when it said that "loss of earning capacity" and "ability to compete in the open labor market", the former substituting the latter in the landmark reform bill SB 899, as being synonymous.

The California Division of Workers' Compensation (DWC) has a new Administrative Director (AD) coming on board, and presumably one of the major actions that the new AD will be taking is instituting a new permanent disability rating schedule (PDRS), which DWC was required by law to have implemented last year (a law that the DWC under the Schwarzenegger Administration conveniently ignored).

Some in the community are hopeful that a new rating schedule can be constructed to deal with vagaries that have been introduced by court decisions, and in particular the Ogilvie case.

I am less optimistic.

The court decisions throughout the years, well before SB 899, have consistently upheld the concept that factors in the PDRS can be rebutted. There has been some guidance, but this being case law, unique facts underlying the opinions make the standardization of any specific factor very difficult.

While the WCAB may have exceeded its authority in ascribing the technique to be used to rebut the diminished future earnings capacity (DFEC) component of a rating, it was a solid attempt at bringing some stability and predictability to rating. If you could provide the specific evidence documenting supporting numbers, you know what the answer would be, given the WCAB's original formula.

Now we are back to a case-by-case basis in determining not only what can rebut a rating, but what a rating may be given any similar set of facts.

That will not change with a new rating schedule - the DWC lacks the authority to overturn by regulation what has been upheld as case law for many years.

If anything, a new rating schedule will introduce more confusion and complexity since it will apply only to injuries incurred after the effective date of its introduction (unless perhaps there is some legislation to make it retroactive, in which case that may open up older cases to new litigation).

Such is life in the California workers' compensation system.

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