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Winners and Losers

The Olympics have just concluded.  Watching the athletes reminds us that, even when you try your best, you cannot win every time.  In this edition of the Bulletin, we report on some recent wins and losses.

Defining “Sudden and Extraordinary”. On February 23, 2018, the Court of Appeal ordered published its opinion in the case State Compensation Insurance Fund v. WCAB (Guzman), in which the court clarified what is, and is not, a “sudden and extraordinary employment condition” to support a claim for psychiatric injury.  We consider this decision a win not just for the defense position, but for all of our understanding of the law.

Per Labor Code §3208.3(d), in the first six months of employment, a psychiatric injury is not compensable unless it is caused by “a sudden and extraordinary employment condition.”  In Guzman (no relation to the other well known Guzman case), the applicant was a construction worker using a compactor to tamp down earth.  After using the compactor on a slope for about half an hour, the compactor hit a rock, bounced up, and fell on him.  He had been working for the employer for just under six months.

Applicant claimed psychiatric injury, and argued that the injury was caused by a “sudden and extraordinary” event.  At trial, he testified that he had done this type of work for many years (on level ground, not on a slope), had never before had a compactor fall on him, and had never heard of a compactor falling on someone. Relying on his testimony, the trial judge concluded that having a compactor fall on an employee is not foreseeable, and therefore was a sudden and extraordinary event.  Defendant argued that striking a rock in the soil is a typical hazard, in that it is foreseeable that soil will contain rocks, that a compactor will recoil when hitting rocks, and an employee could be injured.  The fact that he had not been injured before did not make this something “extraordinary”.  Defendant also argued that, considering he had been doing this task for half an hour before it happened, the incident was also not “sudden.”

The Court first noted that it is the employee’s burden of proof to establish a compensable injury, including whether an event claimed to cause psychiatric injury was “sudden and extraordinary”.  Whether an incident is “sudden and extraordinary” is not based on the specific employee’s past experience.  Rather, it is based on the circumstances of the incident and whether, in those circumstances, what occurred is “uncommon, unusual, and totally unexpected”.  Noting that there was no evidence that it was unexpected for rock to be in soil, or for a compactor to rise when striking rock, or for an operator to become unbalanced while working on a slope, the Court found that the evidence did not support a finding that this was “extraordinary”.  The Court also agreed that an incident which occurred thirty minutes after the employee started the task was also not “sudden”.

We applaud the Court for their common sense interpretation of the law in this case.

Losing Despite Your Best Efforts.  As an example of how things can go wrong even when you do everything right, we have the WCAB panel decision in the case Belinda Go v. Sutter Solano Medical Center.

The issue was whether an applicant was entitled to temporary disability benefits for a period while she was recovering from surgery, which she scheduled with a self-procured doctor after her authorized treating doctor’s request for the surgery was denied by UR, and the denial was upheld by IMR.

The Board panel’s decision was that she was entitled to the temporary disability benefits because the QME, Dr. Zwerin, found that the surgery was reasonable medical treatment.  The panel drew a distinction between whether a defendant is required to pay for self-procured treatment and whether a defendant is required to pay disability benefits to the applicant resulting from that treatment.  The Board held that Labor Code §4605 allows an applicant to self-procure medical treatment (although the employer is not required to pay for it), and “In that the UR and IMR statutes are silent on the question of temporary disability indemnity, an employee is not precluded from claiming it even if the disability results from reasonable medical treatment that is self-procured pursuant to section 4605.”  Although the panel recognized that this could expose employers to liability for the consequences of treatment that does not meet the UR/IMR standards, they found “this is the law under the existing statutes.”  As an indication that even the Board panel was not entirely comfortable with this, at the end of the opinion they obliquely invited the legislature to look into this further.

Like the Board panel that issued this decision, we are not particularly pleased with this interpretation of the law, and agree that, if this is an accurate interpretation of the relevant statutes, the legislature might want to look into this further.  It seems inconsistent with the intent of the UR/IMR rules that an injured worker can get indemnity benefits by ignoring the UR/IMR process, self-procuring treatment outside the system, and then have a QME declare the treatment to be reasonable. The best that we can say about this case is that it is only a panel decision and not binding in any other case, although citable.

A  Significant Win. There is an ongoing dispute in the workers’ compensation community on the issue of whether vocational rehabilitation expert reports are admissible in cases where the date of injury is January 1, 2013 or later. Although the dispute has existed for more than five years, there are no published decisions on the issue. Applicant’s attorneys argue that vocational rehabilitation expert opinions are still admissible, although we do not find their arguments particularly persuasive, or even logical.  The defense position is that vocational expert reports are not admissible because the permanent disability rating schedule set forth in Labor Code §4660.1, which applies to injuries 1/1/13 and later, does not contain any provision for adjustment for diminished future earning capacity or diminished ability to compete in the open labor market.  Instead, the statute provides that all impairment ratings based on the AMA Guides are simply multiplied by a factor of 1.4.

We are proud to report that James Cotter of our Oakland office was successful in obtaining an Opinion on Decision in which the trial judge agreed with the defense position on this issue. Although the applicant in the case sought to have a relatively modest permanent disability rating converted to a 100% rating based on a vocational expert report, the judge agreed with James that Section 4660.1 does not allow him to even consider those reports.  Applicant did not even seek reconsideration.

Good job James!

Need Assistance? Are you interested in having M&F attorneys design a customized training or claim review round-table meeting for your office? We’d be happy to provide on-site assistance as required to help you meet the challenges of today’s claims administration issues, and to assist you in complying with all regulatory guidelines. Contact us today at education@mulfil.com for further details or to schedule a seminar!

DISCLAIMER — The purpose of this e-mail is to review the latest developments in workers’ compensation law and related issues which may be of particular interest to the workers’ compensation community. The information contained herein has been abridged from various sources and should not be construed as legal advice or opinion, and is not a substitute for the advice of counsel.