Employlaw.com California Workers' Comp

CALIFORNIA WORKERS' COMPENSATION CLAIMS
(Understanding California's workers' compensation system)

(Two future workers' comp claimants at work)

	*COMING SOON - Direct links to California attorneys in your locale specializing in California workers' compensation claims. You can also e-mail our office by pressing here.*
WHAT IS WORKERS' COMPENSATION?
In a nutshell, "Workers' Comp" is an employer-provided insurance benefit that pays an injured employee's medical bills and a calculated amount as lost wages for the time the injured employee is unable to work and generate an income.
A Workers' Compensation program has both private and government aspects to it. "Private" in the sense that a workers' compensation claim is typically handled between the injured employee, the employer, and the employer's insurance company, (who pays the injured employee's medical bills and lost wages to the employee).
California state government gets involved in that there are state laws regulating and administrating aspects of workers' compensation claims. For example, California has a law requiring California employers to provide their employees workers' compensation insurance coverage and benefits. Think of this as being similar to your driving privileges, where if you drive a vehicle in California you must have insurance. (California's mandate on employers having workers' compensation insurance is so strict that it is a crime for a California employer not to have workers' compensation coverage).
Government also gets involved with workers' compensation in that there is large state bureaucracy that administrates some aspects of the workers' compensation system, such as adjudication of workers' compensation claims (for example, when the employer or employee disagrees about a temporary or permanent disability rating.
Although the workers' comp system is heavily regulated by the State of California, *workers' compensation benefits are paid by an employer's workers' compensation insurance policy*. Disputes between the employee and the insurance company are litigated in the State system, the Workers' Compensation Appeals Board [WCAB].
Think of WC insurance working the same way as your auto insurance policy. With your car, if you get in an accident that is your fault, your insurance carrier pays claims under the provisions of your insurance policy. It works the same way with an employer's workers' compensation insurance policy.
Although the WC system is "no fault," because it's the employer's insurance policy that pays the claims, if injured employees make WC claims *the employer's insurance policy rates will most likely increase*, much the same as your auto insurance policy premiums might increase if an accident was your fault.
In California there are hundreds of insurance companies providing workers' comp insurance coverage to employers. Just like your car insurance, the employer tries to find a carrier based on what the policy will cost, deductibles and coverage limits. And just like your auto insurance, if injured employees have made claims, at policy renewal time a carrier will require the employer to pay higher rates for coverage. [It's this fact that motivates some employers to discourage injured employees to file a WC claims.]
Perhaps most important on how all this works, although you file a workers' compensation claim with your employer, after the forms are filled out the claim is forwarded to the employer's insurance carrier, similar to what you would do in an auto accident. Just like your auto insurance policy, it's the employers' workers' compensation insurance company that administers benefits to injured employees.
WHAT SETS A WORKERS' COMPENSATION CLAIM IN MOTION?
Well as you may suspect, you first have to suffer an injury while "in the course and scope of employment." (Note: there has been years of litigation over what constitutes an "injury" and "when is one considered to have been injured "on the job" or working for an employer. For example, if you commute to work, that's usually not considered being "on the job." But what if on the way to work, per your boss' instructions, you stray off your usual route to deliver a repaired computer to customer. You get into an accident that causes you significant physical injury. Was that injury during the course and scope of your employment?)
Anyway, after suffering an injury, as soon as you are able your employer will have you fill out claim forms that will provide the employers' insurance carrier with details about what you were doing, how did the injury occur, witnesses, where did you obtain medical treatment, what medical practitioners have you seen, are you able to work, how much time have you taken off, etc., etc. The completed forms are then sent to the employer's workers' compensation insurance company who proceeds to administrate your claim.
After you file a claim the claims process is out of the employer's hands. Just like your auto insurance policy, a workers' comp insurance company has adjusters, investigators, doctors and lawyers to determine the propriety and value of claims made by employees. It's the workers' comp insurance company that investigates your claim, decides what it will or will not cover, pays wage benefits to you, pays the medical providers, and at some point terminates payment of additional benefits because in the insurance company's opinion you are back to 100%, so to speak..
DOES MY EMPLOYER HAVE TO CARRY WORKERS' COMPENSATION INSURANCE?
That's easy to answer, as said on California's Workers' Compensation Website: "California law requires employers to have workers' compensation insurance if they have even one employee."
Failing to have workers' compensation coverage for an employee is a criminal offense. Section 3700.5 of the California Labor Code makes it a misdemeanor punishable by either a fine of up to $10,000 or imprisonment in the county jail for up to one year, or both. Additionally, the state issues penalties of up to $100,000 against illegally uninsured employers. You would be correct in concluding that California law takes very serious an employer's failure to have workers' comp coverage for employees.
I'M A WORKERS' COMPENSATION CLAIMANT - DO I NEED A LAWYER? WHY?
Considering the number of California employees injured on the job each day, it's reasonable to conclude that the majority of workers' comp claims are handled smoothly and without incident. However, if an employee pursues a significant claim [e.g., where an injury might result in a permanent disability; or maybe there will be lots of time off required for rehabilitation], the severely injured employee may need to retain an attorney specializing in workers' compensation claims to fight the insurance company's inevitable limitation or denial of benefits to the injured employee.
WHY DOES THERE HAVE TO BE A FIGHT; WHY NOT JUST PAY MY DAMN CLAIM?
On serious claims (where there is a lot of money in play) Workers' Compensation claims become contentious because of opposing interests. An injured employee wants his or her doctor bills paid. He or she wants to be paid wages while healing. If there is a permanent disability, the employee wants just compensation for rehabilitation, retraining for another occupation conducive to one's disabled condition.
In contrast, a workers' compensation insurance company is a business, just like any other. This means the insurance company is in business to make money, aka profits.
The golden rule on making money in the insurance business is to receive monthly premium dollars, to invest that money elsewhere, and to pay out as little as possible in benefits. The golden rule in surviving in the insurance business is to pay out a lot less money in claims than premiums being paid.
There is nothing wrong or illegal about this business model. Unfortunately, in trying to maximize profits more than a few insurance companies act in bad faith, utilizing questionable tactics (and at times illegal) to limit insurance policy payouts on injured worker claims.
For a depiction of bad faith insurance practices in action see The Rainmaker starring Matt Damon, Danny DeVito, John Voight, and Claire Danes. Directed by Francis Ford Coppola.
The Rainmaker is one of the best feel good legal dramas of all time. Get it on Netflix immediately, if not sooner!
How can insurance company employees sleep at night? First of all, understand that most people working in the insurance industry are honest, hard working individuals, who act in good faith and with honesty. What about the bad apples, how do they justify their tactics?
Aggressive insurance companies (and adjusters or claims representatives) operate illegally or act maliciously under THEIR flawed assumptions that injured employees are malingerers or frauds looking to game the system. And if the employee "lawyers up?" The insurance carrier assumes the injured employee's attorney is nothing more than an incompetent loser hack advancing excessive or fraudulent claims.
For example, in permanent disability claims (the most serious and contentious of all workers' compensation claims) the insurance company figuratively "fights to the death" because paying out disability claims are a serious detriment on the carrier's bottom line. The carrier justifies aggressive tactics on the assumption that the employee is faking it, so to win the "Big Spin lottery." And the lawyer? Well he, the carrier assumes, is simply looking for a big payday with as little work as possible.
What does your employer think about all this? In general, employers approve of its insurance company's aggressive tactics because if less benefits are paid out to you this may result in less of an increase in insurance premiums the employer has to pay because its employees filed claims. The concept is no different than you fighting a traffic ticket to prevent your auto insurance rates from increasing due to traffic citations received..
*WHY THE JADED VIEW, YOU ASK.*
Well... it's not just employlaw.com that thinks this way:
After reading this workers' comp page a California Judge contacted employlaw.com and offered the following viewpoint. [A major thank you for Your Honor taking the time to write employlaw.com. Readers will surely appreciate the Court's insights.
I am a veteran Workers' Compensation Judge at [location deleted by employlaw.com]. I recently came across your website. I enjoyed your realistic approach. Workers' compensation cases are characterized by the same emotionality that you rightfully attribute to other types of employment disputes and family law cases.
It has been my experience that insurance companies often deny reasonable claims. Neither claimants nor insurance companies seek out doctors whom they think will give them an "honest" opinion because what they want is a medical opinion that favors their respective interests. Consequently, it can be difficult to know which opinion to believe.
Insurance companies frequently deny benefits on the basis of absurd medical opinion (opining the employee is physically fit and able to return to work) when in fact employees can't be rehabilitated, and the employer on whose job the employee was injured won't take him or her back.
This is not to say that claimants-employees don't try to take advantage of employers and insurance companies. They do. After 15 years of judging, and with 7 years practice in the field, I've come to the conclusion that opportunists can be found in equal proportions on both sides.
*[Highlighting provided by employlaw.com]*
*Sincerely, Judge (name redacted by employlaw.com)*
*MISCELLANEOUS TIDBITS*
In California, the omnipresent Department of Industrial Relations monitors and enforces employer compliance with workers' compensation laws. This agency's Field Enforcement agents carry badges and can really put the wombie on an employer who fails to carry Workers' Compensation insurance.
The battleground for disputed workers' compensation cases is the Workers' Compensation Appeals Board ["WCAB"]. An appeal of an administrative law judge's decision is heard by a WCAB panel who render a decision on a timely filed appeal. Battles are fought at the WCAB because California government does NOT want workers' compensation disputes clogging up the State civil court system. Moreover, disputes are supposed to be handled on an expedited basis and not turn into complex and costly litigation, such as the parties would suffer should they be allowed to fight it out in civil Superior Court.
By law, attorneys who handle workers' compensation claims are restricted to collecting a limited contingent fee from the employee for legal services rendered. Since our firm does not handle workers' compensation claims, we don't know what the fee percentage is, although a few years ago we heard it was around 13 percent. We believe it has gone up though, but not by much.
The most significant relationship Workers' Compensation claims has to employment law is the "exclusive remedy" doctrine. Lawmakers, courts, insurance companies, employers, employees and lawyers have extensively wrestled with the doctrine and its application to workplace disputes/injuries and employment law claims. The concept is best understood by example.
Assume an employee has been sexually harassed and assaulted at work. Also assume that once the employee complained to her employer, it responds by falsely accusing her of stealing and terminating her for the alleged theft.
For this example assume the employee can prove physical and emotional injury [or "damages"] from her claims of assault and battery, sexual harassment, defamation of character [falsely accused of stealing], and wrongful termination. In other words, assume the employee is a "basket case." Plaintiff's counsel estimates the fired employee's case has a trial value of $500,000, but tells her if she is restricted to workers' compensation benefits, she will receive $22,000 in lost wages [for being unable to work for six months] and $1600 in medical payments [including therapy.]
In the above example, if the employer can restrict the employee's claim to receipt of workers' compensation benefits, and nothing else, the employer will save significant money by not having to pay tort damages [the $500,000].
So how does an employer do this? Typically, the employer first argues that the employee's injuries, no matter what type, were "work related" [that is, the employee's injuries occurred on-the-job]. The employer then argues that because the injuries are work related, the employee is entitled only to work-related injury payments, typically reduced wages and medical payments paid by the employer's workers' compensation insurance carrier.
In retort, through her employment law attorney the employee argues that her injuries were not work-related [in other words, the injuries were not typical work injuries, such as falling on the floor], therefore, she should be allowed to sue the employer to recover tort damages. Tort damages would far exceed workers' compensation payments. Tort damage recovery may include recovery for emotional distress, punitive damages, and statutory attorney fees.
The possibility that an employee might recover emotional distress and punitive damages has provided strong motivation to employers to aggressively argue that no matter what happens in the workplace, the employee is entitled only to lost wages while off work receiving employer-paid medical treatment.
THE BIGGEST DANGER IN ALL THIS: AN EMPLOYEE CAN ELECT WORKERS' COMPENSATION BENEFITS AS THE EXCLUSIVE REMEDY FOR HIS OR HER WORKPLACE INJURIES. AN EMPLOYEE CAN ALSO WAIVE THE RIGHT TO PURSUE OTHER REMEDIES BESIDES WORKER' COMP BENEFITS. AND TO FURTHER COMPLICATE MATTERS, AN EMPLOYEE CAN PURSUE BOTH WORKERS' COMP AND TORT REMEDIES, AND COLLECT UNDER BOTH THEORIES!
Many things can happen to an employee at work that are not part of the employment contract between employer and employee: assault and battery, sexual harassment, false imprisonment, defamation of character, fraud, battery, or violation of statutes protecting employee privacy, the list is almost endless.
Whether or not workers' compensation is the exclusive remedy for an employee's injuries is not too complicated, but you should seek the advice of a competent employment law attorney in your area to obtain information on these issues.
WARNING: If you have a workers' compensation or other employment related dispute, you should see the advice of an employment law AND also a workers' compensation lawyers to properly advise you on what is what.

LINKS
	Excellent general information on workers' compensation.
	Frequently Asked Questions [and answers] for employers.
	California Workers' Compensation, injured employee's page.
	WCAB Policy and Procedure Manual (How WCAB employees are to carry out their duties)