BILL ANALYSIS Ó
SB 897
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Date of Hearing: June 22, 2016
ASSEMBLY COMMITTEE ON INSURANCE
Tom Daly, Chair
SB
897 (Roth) - As Amended June 16, 2016
SENATE VOTE: 35-0
SUBJECT: Workers' compensation
SUMMARY: Extends "4850" benefits for certain public safety
officers for an additional year in the event of defined
catastrophic injuries. Specifically, this bill:
1)Requires local government agencies that employ certain peace
officer and firefighter employees to pay up to two years of
"4850" benefits in the event of a "catastrophic injury at the
hands of another."
2)States that "catastrophic injury at the hands of another"
includes severe burns, severe bodily injuries resulting from
the collapse of a building, and severe bodily injuries
resulting from a shooting or stabbing.
3)Specifies that the injury must have occurred during duty, and
through the direct result of the actions of another.
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4)Provides, notwithstanding the "direct result of the actions of
another" limitation, that qualifying injuries that result from
active firefighting trigger the expanded benefit "without
respect to the cause of the fire."
5)Provides that the two year period for which the expanded
benefit is potentially available ends if the injured employee
starts receiving a permanent disability pension.
6)Specifies that the expanded benefit applies to local police
officers, sheriff's officers, and local firefighters.
7)Specifies that the bill does NOT apply to employees whose
duties do not involve active law enforcement or active
firefighting.
8)Provides that a leave authorized by the bill shall not be
deemed by an employer to be family or medical leave.
9)Provides that the benefits authorized by the bill do not apply
to employees of the City and County of San Francisco.
10)Specifies that the benefits authorized by the bill are
temporary disability benefits subject to the time limitations
in the Labor Code.
EXISTING LAW:
1)Provides for a comprehensive system of employer-paid benefits
to be provided to employees who suffer illness or injury that
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arises out of, or in the course of, employment.
2)Includes temporary disability benefits (TD) for up to 104
weeks if an employee is temporarily unable to work during
recuperation from the workplace illness or injury.
3)Establishes a minimum and a maximum amount that an employee
may receive, which is adjusted annually to reflect rising wage
levels. Currently the minimum benefit is $165 per week, and
the maximum benefit is $1103. The benefit is calculated based
on 2/3 of an employee's average weekly wages, subject to the
maximum cap.
4)Provides specified public safety officers (most peace officer
and firefighter employees of local governments and special
districts) with an enhanced temporary disability benefit for
up to the first year of temporary disability. These safety
officers receive their full salary (tax free) during the first
year of temporary disability (commonly referred to as "4850"
benefits).
FISCAL EFFECT: While Legislative Counsel did not key this bill
fiscal, it would likely result in substantial increased
disability costs to local governments that employ public safety
employees who would benefit from the bill.
COMMENTS:
1)Purpose. According to the author, constant medical advances
allow greater opportunities for recovery from severe injuries,
but often, it takes more than a year to fully recover. The
author points to a Riverside Police Department officer, Andrew
Tachias. Officer Tachias was seriously wounded, and his
partner killed, by a disgruntled former police officer who
went on a multi-county rampage in February or 2013. It took
nearly 3 years before Officer Tachias was able to return to
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work, during which time his Department did, in fact, keep him
on full pay leave. The bill is designed to ensure that all
officers and firefighters who suffer similar catastrophic
injuries are similarly treated.
2)Temporary disability benefits. The goal of TD is to
approximate an employee's take home pay during the period
after injury when the employee is temporarily unable to work.
This goal is implemented by basing the weekly TD benefit on
2/3 of the employee's average weekly wages. Because there is
a cap, employees who make more than approximately $1600 per
week do not reach this 2/3 goal, but because the benefit is
tax free, most employees receive an adequate TD benefit while
they are recovering.
3)Special public safety benefits. Most public safety officers
(peace officer, sheriff, and firefighter employees generally)
receive certain special workers' compensation benefits that
other employees do not receive. Most notably, this class of
employee has the benefit of a range of "presumptions" that
certain illnesses or injuries are automatically deemed to be
work related. All other employees are required to prove that
their condition is work related. The second significant
special workers' compensation benefit is granted by Labor Code
Sections 4800 through 4850 - commonly referred to as "4850
time" - and this law grants defined employees up to one year
of full salary in lieu of the regular method for calculating
TD benefits.
4)Tax advantages. Because these benefits are paid due to
disability, they are not subject to either state or federal
taxes. This applies to regular TD benefits, and to 4800-4850
benefits. Because of the tax-free status of this benefit, a
public safety officer takes home substantially more in weekly
benefits than they normally earn while working - i.e., normal
take home pay plus what would have been paid in taxes. Public
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employers have long complained that this creates a
disincentive in getting injured public safety officers to
return to work, even if they are able, due to the financial
loss they would suffer when they return.
5)Collective bargaining? If a public agency wants to grant
employees certain benefits of employment, it is able to
accomplish that goal without need for a statutory change. In
fact, the City of Los Angeles has provided "4850-like"
benefits to a range of employees without need of a statute
mandating the benefit for those employees. By statute and by
collective bargaining, some public safety officers have
obtained enhanced TD benefits that equal their take home pay,
irrespective of the statutory TD cap. Collective bargaining,
and not legislation, may be the better approach to enhancing
the benefits for this class of employee.
6)Benefit available in limited circumstances. Regular 4850
benefits (for local government public safety officer
employees) are available to the defined class of public safety
officers for any disabling injury that arises out of or in the
course of employment (certain state public safety officer
employees only receive 4850-like benefits when performing
"active" law enforcement or firefighting duties). The
expanded benefit proposed by the bill would only be triggered
by certain severe injuries that occur as a result of defined
causation. Thus, the peace officer who is injured in a common
automobile accident would not be eligible for this expanded
benefit, but a firefighter who suffers severe burns when the
building that is on fire collapses on her would be eligible.
7)"Catastrophic injury". The goal of SB 897 is to provide an
extra year of 4850 benefits to a narrow class of public safety
officers for a narrow range of injuries. However, the bill
provides that the catastrophic injury at the hands of another
merely "includes" the listed injuries. The "includes"
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approach suggests that other, not listed, injuries would also
trigger the expanded 4850 benefit. Unfortunately, absent
legislative clarification, exactly what other injuries would
suffice can only be resolved by litigation.
8)"At the hands of another". This qualifying phrase in the
definitions portion of the bill applies to most of the covered
injuries that could be suffered by peace officers. However,
if the injury is the result of active firefighting duties,
there is no requirement that the fire or other triggering
circumstances be caused by another party.
9)Severe burns and bodily injuries. As noted by opponents,
"severe" is a vague term that is not defined by the bill. The
concern, similar to the concern about "includes," discussed
above, is that it is impossible to know whether the bill is
narrow or broad, because there is no clear definition of which
injuries are sufficient to trigger the expanded 4850 benefit,
and which are not. Only through litigation will these issues
be resolved, and opponents fear, in addition to the expense of
litigation, that the bill will end up covering a far broader
scope of injuries than intended by the author.
10)Recent legislation. In recent years, the Assembly Insurance
Committee has looked to the employing jurisdictions to support
expansions of benefits for their local employees. The
Committee has moved 4850 expansions where the local
jurisdiction at issue was in support, but not where there was
no local employer support. The three bills noted below all
involved an expansion for employees of a specific local
jurisdiction, as opposed to SB 897, which would apply to all
local jurisdictions that employ peace officer or firefighter
employees.
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In 2013, SB 527 (Block) was signed into law. SB 527 added
lifeguards employed by the City of San Diego to the list of
public safety employees entitled to 4850 time. Proponents of
that bill argued that the San Diego lifeguards performed
duties comparable to Los Angeles County lifeguards, who
already have this benefit. The City of San Diego supported
the bill.
Last year, SB 559 (Block) proposed to add lifeguards employed by
the City of Imperial Beach to the list of public safety
employees entitled to 4850 benefits. The City did not support
the bill, and it was held in the Assembly Insurance Committee.
AB 1451 (Chavez) also sought to provide 4850 benefits to a class
of lifeguards employed by the City of Oceanside, arguing that
other lifeguards employed by San Diego and Los Angeles who
performed comparable duties already receive this benefit. The
City of Oceanside supported the bill. Governor Brown vetoed
AB 1451. The veto message stated:
"This bill adds full-time lifeguards employed by the City of
Oceanside to the list of employees who are entitled up to one
year of leave, paid at full salary without payroll tax
deductions, if they suffer an illness or injury that arises
out of their job duties.
Recent data indicates public employers' costs related to this
disability leave benefit have increased at an alarming rate.
These cost figures give me pause to extend this benefit
further in state law. If the City of Oceanside wishes to
offer full salary in lieu of temporary disability for one year
to their regular full-time lifeguards, they are free to do so
by means of the collective bargaining process. Eligibility
for this benefit is best left to the City of Oceanside, not
the state, to determine."
REGISTERED SUPPORT / OPPOSITION:
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Support
Association of Orange County Deputy Sheriffs (AOCDS)
Bonita-Sunnyside Fire Protection District
California Applicant's Attorney Association (CAAA)
California Professional Firefighters (Sponsor)
Association of Orange County Deputy Sheriffs (AOCDS)
California School Employees Association (CSEA), AFL-CIO
California Statewide Law Enforcement Association (CSLEA)
Fraternal Order of Police (FOP)
Laborers International Union of North America Locals 777 & 792
LIUNA Locals 777 & 792
Long Beach Police Officers Association (LBPOA)
Los Angles Count Professional Peace Officers Association
Orange County Professional Firefighters Association, Local 3631
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Peace Officers Research Association of California
Riverside Police Officers' Association (RPOA)
Sacramento County Deputy Sheriffs' Association (SCDSA)
San Bernardino Police Officers Association
Service Employees International Union (SEIU)
Opposition
Bonita-Sunnyside Fire Protection District
California Association of Joint Powers Authorities (CAJPA)
California Coalition of Workers' Compensation (CCWC)
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California Insurance Pool Authority
California Police Chiefs Association
California Special Districts Association (CSDA)
California State Association of Counties (CSAC)
California State Association of Counties- Excess Insurance
Authority
California State Sheriffs' Association (CSSA)
City of Anderson
City of Buena Park
City of Chino
City of Fountain Valley
City of Grover Beach
City of Menifee
City of Monrovia
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City of Montclair
City of Newport Beach
City of Plymouth
City of Rancho Cucamonga
City of Redding
City of San Luis Obispo
City of Santa Maria
City of Torrance
City of Ventura
City of Villa Park
City of Visalia
CSAC Excess Insurance Authority (CSAC-EIA)
League of California Cities (LCC)
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Los Angeles County Board of Supervisors
Mayor and City Council of the City of Sacramento
Public Agency Risk Sharing Authority of California
Rural County Representatives of California (RCRC)
Analysis Prepared by:Mark Rakich / INS. / (916)
319-2086