Workers' Compensation

California: The Settlement of the SJDB Voucher in the Post-1/1/13 Date of Injury Case

In Beltran v. Structural Steel Fabricators, 2016 Cal. Wrk. Comp. P.D. LEXIS – (cite pending), the WCAB panel rescinded the WCJ’s Order Approving Compromise and Release which disallowed the parties’ agreement to settle any claim the applicant laborer may have to a Supplemental Job Displacement Benefit voucher under Labor Code § 4658.7 [LC 4658.7], in connection with the applicant’s industrial cumulative trauma to his head and back over the period 10/20/2013 to 10/20/2014.

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The WCAB panel found that the prohibition on the settlement of a Supplemental Job Displacement Benefit voucher in Labor Code § 4658.7(g) is analogous to a settlement of vocational rehabilitation benefits, which Thomas v. Sports Chalet, Inc. (1977) 42 Cal. Comp. Cases 625 [42 CCC 625] (Appeals Board en banc opinion) held could be settled in a Compromise and Release only when a serious and good faith issue exists which, if resolved against the injured worker, would defeat all of his or her rights to compensation benefits.

As in Thomas, where the parties establish that there is a good faith dispute which, if resolved against the injured worker, would defeat the injured worker’s entitlement to all workers’ compensation benefits, the injured worker may settle his or her potential right to a Supplemental Job Displacement Benefit voucher by way of Compromise and Release, and that under the facts in this case the parties have established that a good faith dispute exists based on the post-termination affirmative defense under Labor Code § 3600(a)(10) [LC 3600], which, if accepted by the WCJ, could bar the applicant’s recovery of all workers’ compensation benefits.

Commentary:

Beltran reflects the continuing saga of job retraining benefits in California. As pointed out by the commissioners in Beltran, vocational rehabilitation benefits were eliminated as part of the reform that was passed in 2004. Between 2004 and 2012, injured workers were entitled to a voucher to help them obtain the training or skill enhancement up to a value of $10,000. As a result of the most recent reform in 2013, an injured worker is now entitled to a voucher worth up to $6,000 in those cases where the worker has suffered permanent partial disability and where the employer has not been able to offer the worker a return to employment.

Prior to the 2004 reform, it was common for the parties to settle out the vocational rehabilitation benefit. Settlement of this benefit was expressly permitted by the WCAB decision in Thomas v. Sports Chalet (1977) 42 Cal. Comp. Cases 625 (Appeals Board En Banc). Faced with a Labor Code provision that precluded the commutation or settlement of vocational rehabilitation, the Appeals Board in Thomas found that before the settlement of vocational rehabilitation could be permitted, the trier of fact had to thoroughly review the record to determine whether “a serious and good faith issue exists to justify such a release”. Most of the old settlements settling out the vocational rehabilitation benefit specifically recited this “serious and good faith” language.

Since the 2013 reform, Workers’ Compensation Judge’s (WCJ’s) across the State have been told that they could not approve a settlement that settled out the SJDB voucher. When the parties placed Thomas language in a Compromise and Release(C&R) for a post 1/1/13 date of injury, it was likely ignored as there was no longer a vocational rehabilitation benefit. If the C&R purported to settle the SJDB voucher, the parties were told that they were not allowed to settle the SJDB voucher and the settlement could not be approved. 

Beltran significantly changes this. By analogizing to the present situation to the situation addressed by Thomas, when the SJDB voucher is settled in a post 1/1/13 date of injury C&R, the WCJ will now have to consider the evidence and determine whether the case involves “serious and good faith issues” that could lead to the entire defeat of the worker’s entitlement to benefits. Basically, the WCJ will have to determine whether or not, based on the evidence, the worker could be left with the complete denial of benefits should the case be fully adjudicated.

The practical impact of the Beltran will be (1) that the parties will now be able to settle the SJDB voucher in limited cases and (2) WCJ’s will now look more closely at the evidence in settlements resolving a worker’s ability to seek the SJDB voucher. Quite frankly, in those cases where liability had been denied by the defendant, it did not make a great deal of sense to not allow the parties to settle this benefit. Hopefully, post-Beltran, defendants can now obtain the complete release of benefits they are seeking and the injured worker can receive some compensation for a benefit he or she might not otherwise receive if the case were fully adjudicated.

Read the Beltran noteworthy panel decision.

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