BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 211|
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THIRD READING
Bill No: AB 211
Author: Cedillo (D)
Amended: As introduced
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM. : 5-1, 6/22/11
AYES: Lieu, DeSaulnier, Leno, Padilla, Yee
NOES: Wyland
NO VOTE RECORDED: Runner
SENATE APPROPRIATIONS COMMITTEE : 6-3, 8/25/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson, Runner
ASSEMBLY FLOOR : 54-21, 5/19/11 - See last page for vote
SUBJECT : Workers compensation: permanent disability
benefits
SOURCE : Author
DIGEST : This bill provides, for injuries that cause
permanent partial disability and occur on or after January
1, 2012, for a supplemental job displacement benefit in the
form of a voucher for up to $6,000 to cover various
reeducation and skill enhancement expenses which would
expire two years after the date the voucher is furnished to
the employee or five years after the date of injury,
whichever is later. This bill exempts employers who make
an offer of reemployment or continued employment from
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providing vouchers. This bill requires the Administrative
Director of the Division of Workers' Compensation within
the Department of Industrial Relations to adopt regulations
implementing the program.
ANALYSIS : Existing law establishes a workers'
compensation system that provides benefits to an employee
who suffers from an injury or illness that arises out of
and in the course of employment, irrespective of fault.
This system requires all employers to secure payment of
benefits by either securing the consent of the Department
of Industrial Relations to self-insure or by securing
insurance against liability from an insurance company duly
authorized by the state.
Existing law provides for the payment of indemnity benefits
if the occupational injury causes temporary or permanent
disability which prevents the worker from returning to
his/her job. In the case of temporary disability payments,
the benefit is two-thirds of the weekly loss in wages due
to disability for up to 104 weeks within a five-year period
(Labor Code Section 4650, 4653, 4654, and 4656).
Existing law provides that, except for certain
circumstances, when an injury causes permanent partial
disability and the injured employee does not return to work
for the employer within 60 days of the termination of the
temporary disability (TD), the injured employee shall be
eligible for a supplemental job displacement benefit
(SJDB). The voucher amounts are as follows:
Up to $4,000 for permanent partial disability (PPD)
awards of less than 15%
Up to $6000 for PPD awards between 15% and 25%
Up to $8000 for PPD awards between 26% and 49%
Up to $10,000 for PPD awards between 50% and 99%
The voucher must be used for education-related retraining
or skill enhancement at state-approved or accredited
schools, and uses include tuition, fees, books, and other
expenses required by the school. No more than 10 percent
of the voucher can be spent on vocational or return-to-work
counseling. (Labor Code Section 4658.5)
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Existing law provides that an employer is not liable for
the SJDB for the injured worker if, within 30 days of the
end of TD indemnity payments, the employer offers the
employee alternative or modified work and the employee
rejects or fails to accept this work. (Labor Code Section
4658.6)
This bill, starting January 1, 2012, creates a new process
for the SJDB. Specifically, this bill:
1. Specifies that the SJDB shall be in the form of a
voucher worth $6,000 for qualified expenses,
irrespective of level of PPD.
2. Expands the purposes for which the voucher may be used
to include up to $1,000 for the purchase of computer
equipment, payment of occupational licensing,
certification, or examination fees, the purchase of
necessary tools, and up to $500 for miscellaneous
expenses that would not require documentation.
3. Provides that an employer is not liable for the SJDB if
an offer of qualifying employment is made no later than
60 days after the first report by a treating physician,
qualified medical evaluator, or an agreed medical
evaluator that indicates there will be PPD and the
injury is permanent and stationary.
4. Provides that if the employer or claims administrator
has provided the physician with a job description for
the employee's regular work, proposed modified work, or
proposed alternative work, the physician shall evaluate
whether the work limitations are compatible with the
physical requirements set forth in that job description.
5. Requires the employer to provide the supplemental job
displacement voucher no later than 20 days after the
time to make a qualifying job offer has expired.
6. Specifies that the voucher shall be valid for two years.
7. Provides that an agreement to settle or release a claim
for the SJDB is valid only if approved by a workers'
compensation judge.
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Comments
Need for this bill . Starting in 2006, both employers and
advocates of injured workers began sitting down and
discussing in earnest the challenges of return to work and
the shortcomings of the supplemental job displacement
voucher. This bill is the most recent attempt to address
these concerns and create a voucher system that is better
for both employers and injured workers.
Currently, an injured worker who suffers permanent injury
becomes eligible for retraining vouchers if he/she does not
return to work within 60 days of the termination of TD. An
employer must make a decision about whether or not to offer
the injured worker modified or alternative work within 30
days of the termination of TD payments. A determination of
an injured workers' longer-term level of disability or
permanent disability rating, however, may not be reached
until a significant period of time after the termination of
TD benefits.
Neither injured worker nor employer may know enough about
the lasting medical condition of the injured worker at the
time of the termination of TD to make a decision about a
return to work or whether the employee should contemplate
accessing retraining benefits in order to prepare for a
change of employment. Also, retraining benefits may not
currently be disbursed until there is an actual PD rating
award. This creates a situation where it is known that the
injured worker is due to receive some kind of benefit, but
the exact amount is not clear, preventing the use of
retraining funds when they are most needed.
This bill seeks to address these issues in several ways.
For one, the clock on eligibility for SJDB does not begin
until the employer has received the medical report of
disability, rather than the termination of TD benefits. If
the employer makes an offer of employment, this bill
ensures that the relevant physician for the injured worker
is involved with the decision. The voucher amount is also
flat, irrespective of the amount of disability, and the
bill also opens up the voucher for additional uses.
Finally, this bill protects the injured worker's benefit by
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requiring that settling the voucher can only be done in
front of a workers' compensation judge.
Prior Legislation
SB 3 (Cedillo, 2009) was nearly identical to this bill. It
was held in the Senate Appropriations Committee.
SB 1189 (Cedillo, 2008) sought to establish a time limit
within which eligible injured workers had to be granted
supplemental job displacement benefits and would have
created a procedure for estimating and delivering earlier
retraining benefits in specified circumstances. The bill
was held under submission by the Senate Appropriations
Committee.
SB 942 (Migden, 2007) sought to clarify when an injured
worker could receive SJDBs to improve return to work rates.
SB 942 was vetoed by Governor Schwarzenegger.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13
2013-14 Fund
Fixed benefit Unknown, increase or decrease in
benefit General/
payment level payments over current tiered
levels*Special
Regulations One-time minor, absorbable
costGeneral
* First payments of up to $6 beginning after January
1, 2012, and generally when the employee is able to
return to work doing modified duties and within two
years of the injury.
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In 2005-06, $12 in SJDBs were paid to state employees.
In 2006-07, $135 in SJDBs were paid to state employees.
In 2007-08, $291 in SJDBs were paid to state employees.
In 2008-09, $276 in SJDBs were paid to state employees.
In 2009-10, $358 (30 percent increase) in SJDBs were paid
to state employees.
SUPPORT : (Verified 8/25/11)
California Applicants' Attorneys Association
California Conference Board of the Amalgamated Transit
Union
California Conference of Machinists
California Labor Federation
California Nurses Association
California Official Court Reporters Association
California Professional Firefighters
California Society of Industrial Medicine and Surgery
California State Employees Association
California Teamsters Public Affairs Council
Engineers and Scientists of California
Glendale City Employees
International Longshore and Warehouse Union
Organization of SMUD Employees
Professional and Technical Engineers, Local 21
San Bernardino Public Employees Association
San Luis Obispo County Employees Association
Santa Rosa City Employees Association
SCOPE, Laborers International Union of North America
UNITE HERE!
United Food and Commercial Workers-Western States
Conference
Utility Workers Union of North America, Local 132
OPPOSITION : (Verified 8/25/11)
Acclimation Insurance Management Services
Allied Managed Care
California Chamber of Commerce
California Coalition on Workers Compensation
California Manufacturers and Technology Association
California Restaurant Association
ARGUMENTS IN SUPPORT : Proponents argue that this bill
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will allow an injured worker to access the benefit voucher
once his or her doctor determines that his/her injury has
become permanent and stationary, rather than forcing
him/her to wait until a final disability rating
determination. They argue that speeding up this process,
as well as expanding allowable uses of the voucher for
tools needed for educational and training programs and for
computer equipment, will allow workers to get the
retraining they need more quickly, allowing them to
re-enter the work force faster and with stronger work
skills.
ARGUMENTS IN OPPOSITION : Opponents of this bill have
taken an "oppose unless amended" position. Opponents
believe that this bill tackles an important issue in
California's system of workers' compensation benefits. The
SJDB is important because it provides injured workers who
cannot return to their at-injury employer with an
opportunity to receive retraining in order to move into
another occupation. However, opponents believe that this
bill needs to be amended to ensure that new problems are
not created with respect to the administration of the
benefit. The opponents believe that their amendments will
enshrine the primary reforms of this bill, but also ensure
that the benefit's administration is simplified and less
expensive for the employer to provide.
ASSEMBLY FLOOR : 54-21, 5/19/11
AYES: Achadjian, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Davis, Dickinson, Eng, Feuer,
Fletcher, Fong, Fuentes, Furutani, Galgiani, Gatto,
Gordon, Hall, Hayashi, Roger Hern�ndez, Hill, Huber,
Hueso, Huffman, Lara, Bonnie Lowenthal, Mendoza,
Mitchell, Monning, Olsen, Pan, Perea, V. Manuel P�rez,
Portantino, Skinner, Solorio, Swanson, Torres,
Wieckowski, Williams, Yamada, John A. P�rez
NOES: Conway, Cook, Donnelly, Beth Gaines, Garrick, Grove,
Harkey, Jeffries, Jones, Knight, Logue, Mansoor, Miller,
Morrell, Nestande, Nielsen, Norby, Silva, Smyth, Valadao,
Wagner
NO VOTE RECORDED: Alejo, Gorell, Hagman, Halderman, Ma
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PQ:mw 8/26/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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