In the last several weeks I've done 3 conference presentations on SB 863.

Based on audience questions at the various seminars, one of the least controversial parts of the recently enacted comprehensive workers' comp reform is the section dealing with reforms to the supplemental job displacement benefit, commonly known as the "voucher".

So it was with interest that yesterday I noted the title of an article by Jim Sams on Workcompcentral.com, "Claims Pros See Easy Money in Revamped SJDB Program". And then I noted the headline of David DePaolo's blog piece, "Money For (Almost) Nothing".

Both Sams' article and DePaolo are commenting on the new Labor Code 4658.7 that will apply to injuries occurring on or after January 1, 2013.
Section 4658.7 requires the DWC to adopt regulations for administration of the section.

Among the provisions of the new voucher system is a provision allowing use out of the $6,000 for "purchase of computer equipment, up to $1,000" (see 4658.7(e)(5)).

4658.7 also contains a provision which allows out of the $6,000 voucher payment of:
"Up to five hundred dollars ($500) as a miscellaneous expense reimbursement or advance, payable upon request and without need for itemized documentation or accounting. The employee shall not be entitled to any other voucher payment for transportation, travel expenses, telephone or internet access, clothing or uniforms, or incidental expenses."

Do these provisions amount to a $1500 giveaway?

DePaolo notes that "While most of the $6,000 voucher requires some documentation or other verification that the money is going to be used towards retraining or obtaining another job, two provisions thus far (without further regulatory constriction) have most folks opining that $1,500 is just a give away."

In his blog David DePaolo references a provision in Florida's law that requires a $2,000 PD advance to a worker who either is not able to return to work at the same or similar employment or who has sustained significant wage earning loss. As publisher of Workcompcentral.com, David follows not just California workers' comp but also keeps a keen eye on developments in other states.

Here is what DePaolo concludes:
"Thus far in Florida, there is no good data to suggest that this "give away" has resulted in any significant impact on claims costs. It seems more a point of irritation than any great impact on the system, simply because the threshold for getting "free money" is so low and the settled law is that so long as the injured worker is "better off" with the money then it is payable.Thus I suspect the same with the California provision - it doesn't seem that this will affect costs one way or the other for the most part. I think it will be a "sore point" for some who bemoan the entitlement mentality that sometimes pervades social systems - be that as it may, is it better or worse than the prior voucher system, or vocational rehabilitation that preceded that? Honestly, I don't think it makes a difference one way or the other. Those who are serious about returning to work will probably not use the voucher provisions, and those that aren't serious about returning to work probably won't use the voucher beyond getting a new computer and some extra cash".

In the Workcompcentral.com piece by Jim Sams, Douglas Gorman, return to work coordinator for Contra Costa County Risk Management, is quoted as commenting at DWC public hearings in Oakland that "Every voucher is potentially-and I'm sorry to use this term-a $1,500 giveaway."

Let me push back a bit before this $1500 for nothing narrative takes hold as conventional thinking.

Unfortunately, a narrative that the workers' comp system gives "free stuff" become quite pernicious, particularly where there is increasing concern about whether we live in a culture where significant numbers of folks feel entitled to support.

The thought process behind the $1,000 for a computer is to enable workers
who need one to have sufficient funds to purchase what is a tool to better themselves. In the real world most workers need a computer for resume preparation, job search, or information gathering. Yes, some workers, depending on where they live and transportation access issues, may have potential computer access at a library or through a friend.

But allowing the worker money to get computer equipment (which regulations presumably would indicate include a printer/scanner or perhaps a smartphone?) will help many workers get the tools they need to either look for a job or research their options.

When we are taking "free computer" it's easy to forget that we are talking about workers who either lose their job because of their injury or who at a minimum were not given a timely return to work offer.

And what about the $500 payable on request without the need for documentation?

Under the former California vocational rehabilitation scheme great amounts of time and energy were spent by voc rehab counselors, claims examiners and lawyers on reimbursement issues involving mileage, clothing allowance, and other incidental expenses.

Those who don't represent injured workers don't always get it that a fair number of those individuals are really so economically stressed that they have trouble putting gas in their car to come to court, go see doctors, and look for work.

Whether the majority of the workers who get the $500 miscellaneous reimbursement will spend it wisely is not clear.

But the provisions of the new law take those reimbursement issues off the table, in essence opting for a liquidated amount payable (from the $6,000 retraining voucher) to the worker. Looking at it another way, the worker is going to be fronted some money to get the self-generated retraining process going.

Will some workers who can't return to their jobs take the $500 and a computer and call it a day? Perhaps. But even those who don't avail themselves of the other $4500 available with the voucher will probably find that the computer allowance and miscellaneous reimbursement helps them in locating some options for their future.

So let's not go overboard with the "free stuff" argument. There is good policy and many practical reasons to be in support of the reworked SJDB section.

And lets not forget the big picture. These amendments speed up the provision of the voucher.

Currently (and for injuries til 1/1/2013), a retraining voucher is available for employees who do not return to work for the employer within 60 days of the termination of temporary disability (unless the employee rejected a timely-made offer of modified work or alternate work). The voucher for pre-2013 injuries is payable in amounts between $4,000 and $10,000 depending on the amount of the permanent disability award.

Therein lies the problem.

Currently the PD award is often determined quite a while after the last date of temporary disability payable. So use of vouchers has been low.
Workers have typically not been able to use retraining vouchers at the time they would be most useful.

Newly added Labor Code Sec. 4658.7 addresses that problem.For injuries after 1/1/2013 the trigger for a voucher will be where an employer does not offer regular, modified or alternative work within 60 days of receipt of a P&S report finding that the injury has caused permanent partial disability.

This may act as an incentive for employers to hasten the reasonable accommodation process required under FEHA.

And it surely will make the voucher more usable, coming at a time when the return to work issue is paramount.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

Insurance Commish Steve ("the turtle will beat the hare") Poizner and
eMeg Whitman are duking it out this weekend at the GOP Convention in Santa Clara.

Whitman has finally started talking, after a disastrous phony town hall meeting in Orange County:
http://www.youtube.com/watch?v=_t3kSLSBBHs

But you, dear readers, have more lofty aims for your Saturdays than watching phony politicians set up their manipulations.

You could be reading substantive studies on the comp system. Studies like the RAND study recently posted on the CHSWC website on return to work programs. The study, "How Effective are Employer Return To Work Programs?" was written by Christopher McLaren, Robert T. Reville, and Seth A. Seabury. It's available here:
http://www.dir.ca.gov/chswc/Reports/201 ... ANDRTW.pdf

The summary notes that work injuries are costly and "policymakers are
continuously motivated to find new ways to reduce the duration of work-related absence and improve early return-to-work". The authors note that some states offer subsidies to employers who accommodate, hire or retrain injured workers.

The RAND study surveyed efforts at 40 large self-insured employers and 17,000 workers injured between 1991 and 1995.

The findings noted that workers at a company with a return-to-work program returned approximately 1.4 times sooner than at companies without a program. This was equivalent to a reduction of 3-4 weeks on average duration of work absences for workers in their sample.

RAND concludes that "these programs are cost-efective for large employers" but that "more work is needed to determine whether these programs could be adopted successfully by smaller firms".

California did establish a program under Labor Code 139.48 to help some employers pay for workplace accommodations. In earlier posts I noted that there had been an underwhelming response to that program:
http://www.workerscompzone.com/index.ph ... 310-213410

But with vocational rehabilitation gone (replaced by the job displacement voucher), return to work programs are important. The RAND paper is an interesting study which confirms that return to work programs can be a win-win for employers and workers. The study is currently posted on the CHSWC website for comments.

Stay tuned.

Julius Young
www.boxerlaw.com

Sayonara to voc rehab.

Workers injured before 1/1/04 who still hoped to avail themselves of vocational retraining, or who had hopes to collect voc rehab maintenance allowance money for times when voc rehab was disputed are out of luck.

Today the WCAB issued a unanimous en banc ruling on the VR issue, in its ruling in Lawrence Weiner vs. Ralphs Company and Sedgwick Claims.
Here's a pdf version of the decision:
http://www.dir.ca.gov/wcab/EnBancdecisi ... Weiner.pdf

The bottom line? Voc rehab did sunset 1/1/09. The WCAB does not beleive it has the authority to enforce undecided rehab claims that were in process before 1/1/09. The concept of "ghost statutes" does not fly.

Mr. Weiner went to trial on 11/24/08 on VR entitlement issues. A decision was not rendered by the workers' comp judge until 1/13/09. That was too late for Weiner. The WCAB no longer maintained jurisdiction to award voc rehab or retro VR benefits. Even though he had made timely demands for VR, his VR rights were not "vested".

Let's take a trip back on memory lane. Voc rehab was designed to help disabled workers transition to a new vocation.

After a vocational rehab beneft was added to the law, an army of vocational counselors was established. A state "bureau" was established.
In the 1980s and early 1990s the "bureau" took a paternalistic approach.

Sometimes there was form over substance. I recall many cases where the focus was on "the plan". Coming up with a "plan" for worker training or placement was paramount. Unfortunately the worker was sometimes lost in the process.

Anecdotally, I can say results were uneven (perhaps there were statistical studies, but if so I can't cite them). As with any type of professional service, there was varying quality in the effort of rehab professionals. Many came out of voc rehab graduate or social work programs and were dedicated to their clients. Others ran voc rehab mills.

Running parallel to the workers comp voc rehab program were voc rehab benefits under the California Department of Rehab.

Things changed under Governor Pete Wilson in 1994. Voc rehab, which previously had no hard dollar cap, was then capped at $16,000. That sum was useful, but could provide only a limited amount of training.
Carriers liked the limitation on their exposure. But often carriers ran afoul of notice requirements, and disputes over notices or eligibility sometimes led to substantial liability for "retro" voc rehab money.

Some workers whose claims have not been settled before 1/1/09 may have been sitting on such "retro VR" claims that appear now to have turned to dust.

The Weiner case won't necessarily be the last word. Courts of Appeal will visit the issue. The 2nd District Court of Appeal has granted a writ in a case involving similar issues; the case is Beverly Hilton vs. WCAB. But it looks likely that it's really "sayonara". The courts often extend great deference to the WCAB.

Few honest observers will vouch for the adequacy of the current $4k to $10k "supplemental job displacement voucher". It's not vocational counseling. It's not retraining. It's not placement assistance. It's beneficial only to a certain type of disabled worker.

In retrospect, what went wrong? Would it have been better to give more extensive retraining benefits to a smaller group of workers"? Workers who were somehow judged to be more significantly disabled? More motivated or more likely to benefit from retraining? Should voc rehab have been folded into the State Department of Vocational Rehab? Should services have been provided on some matrix of wage loss or assets and need? Did the benefit go downhill as too many fly-by-night schools and vendors fed at the trough? Could better incentives have been built into the program?

These questions are academic now.

But there are strong policy arguments to be made for helping disabled workers transition to a more productive future. Workers who can not transition are more likely to become users of other public (taxpayer) funded services.

The current system which disqualifies some workers from their jobs without retraining (with only a low "whole person impairment" rating and resulting minimal monetary award), is suspect.

There must be a better way.

Julius Young
www.boxerlaw.com
(you can share your opinions or criticisms with me at jyoung@boxerlaw.com)

In a post within the last several weeks I noted that CHSWC (the California Commission on Health, Safety and Workers' Compensation) had heard a report on unimpressive results in the Return-To-Work Program that was established in Labor Code 139.48.

Out of $500,000 available for distribution to employers seeking funds to help pay for workplace accommodations, only $8,744.44 was distributed from August 18, 2006 to December 15, 2008. I noted that the cost of the program seemed very extraordinary compared to its results.

This program does sunset on 1/1/2010, and I noted that it seemed to be a failure.

Today at the DWC conference I had the chance to speak with the DWC's chief of legislation and policy, Susan Gard. Gard makes a good observation.The program cost figures I quoted in my earlier blog post apparently include the costs for staffing for other functions of the Retraining and Return to Work Unit as well. Exactly how an auditor would allocate RRTW Unit funding between various functions may be open to interpretation. A draft report prepared for CHSWC cited figures for some program expenses but not others. It is true that the RRTW deals with supplemental retraining voucher issues as well.

But Gard's point is that the return to work program is not nearly as expensive as I'd indicated. I'll accept that and offer apologies for any confusion caused by conflating other program costs and the Return-To-Work program. The blog may take strong and even provocative positions at time, but I'm striving to be accurate and fair, and I welcome reader feedback.

But Gard noted in an statement faxed to me that the program "has simply not gotten off the ground". Should we care? Here are some further thoughts.

Let's all keep in mind that the goal of this program is very laudable, as I noted in my earlier post.

At my office (Boxer & Gerson) we have four employment civil litigation lawyers, all of whom do FEHA reasonable accommodation/disability discrimination civil cases. Our office does something that is somewhat unique: the civil attorneys offer a free monthly informational workshop to workers who are having accommodation issues, even if we don't represent them in the comp case.

I'm quite mindful of the struggles that injured workers have when they need accommodations. About a year ago I struggled for 6 months to get a major grocery chain to consider revamping the height and shape of the checkout stand so one of my clients could remain on the job. It's critical that workers be able to get accommodations.

It's also understandable that small employers are often likely to balk
on account of cost. The goal of the Return-To-Work program is to provide a source of funding for some of these costs.

If workers can stay on the job, it's a win for everyone. The 2003 legislation led to the demise of vocational rehab for workers injured after 1/1/04. I've yet to meet many attorneys or injured workers who feel that the supplemental job voucher is an adequate replacement for the loss of the prior $16k retraining benefit.

So in the final analysis we see a Return-To-Work Program that may not be as expensive as I'd alleged, but which has been on the books since August 2006 with very little to show for itself. A program which has been around for over a year and a half and which sunsets in around nine months.

As an armchair quarterback, perhaps more could or should have been done to promote the program up until now.

Apparently one major problem is that few employers have ever heard of the program. The March 2009 draft CHSWC report notes at one point that :
"It is possible that the efforts undertaken by the RRRTW Unit to publicize the program did not reach the intended audience. Small employers may be difficult to reach through educational conferences. The RRTW Unit plans to conduct informational workshops about the program around the State in 2009. Careful design and planning of future outreach may need to consider how, where, and when small employers usually receive information relevant to their businesses..."

Ms. Gard indicates that the DWC has recently undertaken a comprehensive plan to market the program to small employers, enlisting the help of small business advocates. That's good. She indicates that she expects to see more results in the coming months. That's good.

This is a program that all stakeholders want to see become successful.
But without a quick showing of results. it's hard to envision the program surviving the 1/1/2010 sunset.

In my next post I'll share some reflections on some of the topics covered at the Oakland DWC conference.

Julius Young
www.boxerlaw.com

At the bottom of this post there is a link to a DWC newsline issued today.

The DWC advises that the right to vocational rehabilitation sunsets at the end of 2008 for those workers injured before 2004 who might otherwise be eligible.

A benefit that had no dollar limits before 1994 and a $16,000 cap after 1994 may be expiring forever.

There is some controversy over this. I've heard some applicant attorneys advance the argument that voc rehab may still be pursued after January 1, particularly if rehab was started (or demanded) before January 1.

We are coming up on Halloween, so it's a fitting time to note that some attorneys believe that the courts could enforce voc rehab by recognizing
"ghost statutes" even though the Voc Rehab "bureau" or "unit" as it has been called will no longer exist.

Perhaps. But that's an untested and risky strategy.

So those workers seeking VR now have a window of time to use it or lose it. Workers injured after 1/1/04 will remain eligible for a job retraining voucher.

The DWC newsline can be seen here:
http://www.dir.ca.gov/dwc/dwc_newslines ... 62-08.html

Stay tuned.

Julius Young
www.boxerlaw.com
(you can subscribe to the blog by clicking on the RSS reader button on the lower right column under "Most Recent Entries")