Wednesday, January 21, 2009, 08:55 PM - Political developmentsThe long wait is over.
Governor Schwarzenegger has filled the last open slot on the California Workers Compensation Appeals Board. The appointment went to a fellow Republican, Greg Aghazarian. Aghazarian represented an area encompassing San Joaquin County as an elected member of the California Assembly (26th District) from 2002 to 2008.
Aghazarian (who I've never met) recently ran an unsuccessful race for an open California State Senate seat, losing to Davis-area Assemblywoman Lois Wolk by a 65% to 35% margin. One issue that surfaced in the campaign was his acceptance of six-figure per diem expenses while living in Stockton and commuting to Sacramento.
Aghazarian is a graduate of USC and McGeorge School of Law in Sacramento.
In the Assembly he served on the Public Safety and Natural Resources Committees as well as Chair of the Republican caucus.
He was honored in 2008 by the California Civil Justice Association, a business group that supports tort reform:
http://www.cjac.org/newsandresearch/pre ... zarian-ho/
According to political blogs I've seen, there had been speculation a few years ago on whether Aghazarian would take a shot at unseating first term U.S. Rep Jerry McNerney. But eventually Aghazarian did not make the race.
There had been much speculation over whether the Governor would give the final slot as a plum to a political appointee or whether he would reserve the slot for an industry veteran. Earlier Schwarzenegger appointments have been widely applauded by insiders in the "comp community"; the earlier appointees were all distinguished attorneys with years of workers' comp experience.
The current WCAB members all live in the San Francisco Bay Area. There was criticism of a former WCAB member, Janice Murray, who lived in Los Angeles and did not appear at WCAB staff meetings on cases in San Francisco.
Hopefully Aghazarian will make the move from Stockton and be a hands on member of the board, which is a vital part of the California workers' comp system.
Here is a link to a site on Aghazarian's voting record in the legislature:
http://www.allballots.com/user/candidat ... spx?Id=736
Aghazarian may or may not have handled a handful of comp cases, but he clearly is not an attorney with years of experience in the field. However, he will receive guidance from the terrific staff counsel at the the WCAB and other WCAB members who have decades of comp experience.
As a member of the WCAB, he will participate in decisions on appeals in workers' comp cases for years to come.
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Monday, January 12, 2009, 09:54 PM - Political developmentsOne of the more embarrassing recent episodes in California workers' comp has come to a close.
Dollar Tree Stores has agreed to pay the death claim in the case of Taneka Talley. Talley was murdered in 2006 while working as a salesclerk in Fairfield. A customer who Talley did not know walked into the store and stabbed her.
We may never know all of the true circumstances in the mind of the attacker that fateful day. But we do know that there was no personal connection between Ms. Talley and the assailant other than the fact that the workplace provided the connection which led to the attack.
A decision to fight the claim by Dollar Tree (which may or may not have been recommended by its attorneys, Gray and Prouty) garnered national outrage. The case became a textbook example of poor public relations planning.
Talley's family was capably represented by my colleague Moira Stagliano at Boxer & Gerson in Oakland. Boxer & Gerson is proud that we were able to help her family achieve some sense of justice after suffering the loss of Ms. Talley in the senseless murder.
Here's the article of the settlement that appeared in the San Francisco Chronicle:
http://www.sfgate.com/cgi-bin/article.c ... =printable
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Wednesday, January 7, 2009, 11:54 AM - Political developmentsWhat's ahead in the comp world for 2009 and beyond?
It's time for soothsayers among us to crawl out of the post-holiday haze. Rev up your futurescope and take the quiz:
1. Regarding the vacant WCAB commissioner spot, in 2009 Gov. Schwarzenegger will a) continue to leave it unfilled, helping the state budget crunch in the process; b) appoint someone from outside the comp world as a plum post as part of a legislative budget deal; c) appoint a workers' comp insider from the "comp community"; d) appoint a DWC figure to the board; e) none of the above
2. Looking ahead to 2010, applicant attorneys will a) be very divided, with most of the current crop of Democratic candidates finding a share of applicant attorney support; b) unite early behind AG Jerry Brown as the best hope for workers; c) largely hold back from supporting any candidate in hopes that Senator Feinstein will find the Governor's race more interesting than being Senate Intelligence Committee Chair; d) flirt with a Steve Westly candidacy in hopes that Westly can match up well against Republican Silicon Valley CEOs seeking the governorship: e) sit on their hands
3. The issue involving Benson vs, Permanente Medical Group and the apparent demise of the Wilkinson case allowing some successive injuries to be rated as one will be a) resolved quickly and definitively by the 1st District Court of Appeal; b) be unresolved as of 1.1.10 as conflicting decisions are rendered in 09 by different District Courts of Appeal; c) delayed as the Court of Appeal remands the case to the WCAB for more development of the record: d) resolved by the California Supreme Court in 09
4. A revision of the 2005 permanent disability rating schedule will a) be
adopted mid-09, similar to what was proposed in 2008; b) shelved, with
the Schwarzenegger administration claiming that the state's recesssion is too severe to risk any benefit increase; c) adopted at the end of 2009 to go into effect for injuries after 2010; d) dropped in favor of a legislative compromise allowing for a small increase in permanent disability rates; e) still under study at the end of 09
5. 2009 will see California comp insurers a) continuing to enjoy healthy profits; b) in some instances having trouble because of financial problems at parent companies continuing from 08; c) quietly nodding in favor of a benefit increase as they find premium volume continue to decrease; d) attempting to control overhead/loss adjustment expenses as a percentage of premium by laying off staff;
6. In 2009, the following will occur: a) significant shrinkage of the QME pool as old timers say sayonara; b) consolidation and shrinkage of the applicant bar as some practitioners exhaust their supply of pre-899 cases; c) a Federal economic stimulus package creates a boomlet of late 09 construction site cases; d) major changes in the comp defense bar due to decreased claim volume; e) economic shift causes a dramatic loss of power for unions in California, weakening worker advocacy
7. By late 2009, EAMS will : a) be working more smoothly, in part due to better training by the DWC; b) be limping along, with some boards relying on local rules as "workarounds" are developed to avoid some of the time consuming aspects of EAMS procedures and forms; c) be in a state of chaos, as unscannable forms and tasks mount up in EAMS limbo; d) become a subject of legislative hearings
8. By mid 09 the DWC and WCAB district offices will a) breathing a sigh of relief that a legislative budget solution was reached that prevented furloughs and layoffs: b) celebrating that layoffs and furloughs at SCIF were avoided at the DWC and WCAB due to "user funding"; c) operating with terrible morale, as furloughs and budget cuts amounted to wage cuts; d) operating pretty much as always
9. Big stories in 2009 will be a) financial crunch at the Self Insurers Fund due to a spate of corporate bankruptcies; b) the effect on the comp system as the safety net of public health services, unemployment benefits and SDI comes under pressure due to the economy and state budget; c) the California Supreme Court decision in the Smith case on attorney fees for handling treatment denial issues; d) a major Court of Appeals decision on apportionment issues; e) changing CMS rules regarding handling of Medicare SetAsides;
10 . In the legislature 2009 will be a) a repeat of 2008, where a number of bills sponsored by labor and the applicant bar were passed only to face a gubernatorial veto; b) a slow year, with very little legislation pushed by labor and the applicant bar during this legislative year; c) a productive year, where comp legislative deals are cut as part of legislative dealing on the budget and finance issues; d) a year when the Governor softens his opposition to making some changes in his SB 899 comp reform package; e) a year marked by a minor battle over renewal of the right to predesignate
11. On the issue of rebutting the PD schedule by testimony on diminished future earning capacity, by the end of 2009 a) the issue of how to rebut the schedule per the Costa case will clarified by WCAB en banc decision; b) under consideration at the Court of Appeal level; c) still unclear, as various WCAB cases deal with the issue on a piecemeal basis; d) moot, as a PD schedule fix makes such an approach unnecessary or impractical
12. As Republican candidates gear up for the 2010 Governor's race, we will see: a) Insurance Commissioner Poizner holding the line on insurer rate hike requests; b) Former EBay CEO Meg Whitman gathering considerable support from comp insurance interests; c) little if any focus on workers' comp issues; d) one of these candidates reaching out to labor in an effort to broaden their base
13. The incoming Obama administration will in 2009: a) other than in the economic policy area have no direct affect on the comp world ; b) will unveil a healthcare reform package with profound implications for comp; c) enact legislation making it easier for unions to organize and retain members; d) push legislation for Federal insurance company charters; e) achieve immigration reform which will have secondary effects on workers' comp
14. In 2009 there will be increasing interest in: a) regulation of expensive opioid treatments for chronic pain: b) integrating SDI and comp indemnity benefits; c) integrating workers comp and healthcare benefits; d) dropping EAMS altogether; e) integrating retraining voucher rules and fair employment laws;
15. By the 5th anniversary of the passage of SB 899, system observers will be: a) noting how little public attention is paid to comp anymore;
b) observing how comp is insinuating itself into the 2010 governor's race; c) marveling at the resilience of the California Applicant Attorneys
Association; d) noting that system administration and overhead costs are rising and benefits dropping, signaling ongoing problems with the system; e) starting to focus on new strategies to keep medical cost drivers under control; f) speculating on what further major changes will be made at SCIF to get it back on track
Serious entrants in the contest are welcome to e mail me their answers at
email@example.com. I'll tabulate answers at the end of 09. The winner gets a bottle of Dom Perignion for 1/1/10.
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Tuesday, December 23, 2008, 08:52 AM - Political developmentsLots of stuff is getting destroyed these days.
In a deflationary environment, there is "demand destruction". Oil prices go to $50 a barrel. Prices for recycled paper, copper and other materials have fallen off a cliff. Across a wide range of the economy, there are no buyers, only frustrated sellers.
Business models are in transition even for many long-successful enterprises.
But one big concern for workers is whether there will be additional pressure for workers' rights and benefits to devolve. Yes, devolve.
Baby boomers have lived in a time when American workers rights basically were evolving.
The folks outside of Silicon Valley did not get a chance to have on site gyms and Friday beer bashes, but they did enjoy increased benefits in the latter part of the 20th Century (an era that is starting to sound quaint).
But that's been stalling for some time now, as wages have stagnated and many company sponsored health plans have been eliminated or cut back. And manufacturing jobs were outsourced, often while executive pay packages soared.
Even in the wake of a gargantuan bailout, some of the bailed out financial institutions are awarding huge bonus packages.
Union membership tanked, failing to keep up with changes in the type of IT workforce and service economy that was developing.
Workers' comp benefits have been cut in many states over the past decade, with carrier profits ballooning as a result.
Financially stressed, many companies are now cutting 401(k) contributions. Many California employers hope for changes in wage and hour laws as part of a 2009 budget crisis solution.
Are we in a race to the bottom?
Here's a warning from Bob Herbert of The New York Times:
http://www.nytimes.com/2008/12/23/opini ... .html?_r=1
Stay tuned. Later today I'll be posting a piece on the Aguilar case which was recently decided by the California Court of Appeal. Following that, I'll be posting the Top 10 Developments in California Workers Comp for 2008.
Monday, December 22, 2008, 09:06 AM - Political developmentsBeing a chief executive in government is a difficult thing. You have to deal with your own party, your own base.
Gov. Schwarzenegger continues to have problems in that department. We now know he'd like to run for President (he can't). But acting erratically during last week's budget negotiations, no one seems to know what's in his head:
http://www.latimes.com/news/local/la-me ... umn?page=1
Meanwhile, Obama faces an early test in dealing with his labor base. When Bush stepped up at the last minute to provide short-term bailout funding to GM and Chrysler, terms included targets for wage reductions to levels at other U.S. auto plants. Those would be the non-union factories of German and Japanese automakers in the South.
That may be popular with taxpayers, and it may allow Detroit's workers to keep working. But it is hardly going to stem the trend of declining union membership in the USA.
The wage reductions are targets, and it will be up to Obama and his people to deal with the details. As I said, it's not always easy dealing with your base.
Labor is hoping to reverse the declining membership trend.
Most labor advocates were heartened by the appointment of Hilda Solis to be Secretary of Labor. Solis has been a longtime friend of working people's interests as a member of the California legislature and as a member of Congress, elected from a Los Angeles district. I've seen her speak, and she seems to be the real deal.
It's not clear whether Obama will push for quick action on the Employee Free Choice Act, the Holy Grail for many in labor, or whether he will put this lower on the agenda. This will be a divisive issue in Congress and much political capital will be spent.
The Pastor Rick Warren controversy and the difficulty finding a CIA director who will satisfy critics of CIA rendition, torture and Guantanamo policy has shown that Obama may have trouble with his base.
Here's an interesting take on all of this written by Peter Brown of the Quinnipac Poll (what follows in quotes is by Brown) that appeared in the Wall Street Journal:
" President George W. Bush, in giving the auto companies a financial reprieve, presented President-elect Barack Obama and the new Congress the choice of putting another nail into organized labor’s coffin, or starting off the Democratic era with a decision that will rile most of the American people."
"Left for the Democratic president and even more Democratic Congress — both more pro-union than their predecessors — is the knotty question: Should the government insist on conditions for an auto bailout that could put industrial unions even closer to the endangered species list by reducing their value to the membership?"
"The Bush bailout that provides cash for the auto makers to keep them operating through March, leaves it to the new administration and Congress to find a long-term solution to the problem, but the bailout contains provisions that require the United Auto Workers by the end of 2009 accept a pay and work rule package roughly on par with the one in place at nonunion, foreign car plants in the South."
"The Obama White House and the Democratic Congress have the power to change that requirement once they take over."
"Knowing that was likely to be the case, union leaders earlier this month refused to sign a deal with Congress for a bailout that included parity, which would mean UAW workers would have to accept the lower pay and more flexible work rules."
"They are hoping to make fewer concessions to the taxpayers when the changing of the guard means Democrats control all the levers of power in Washington next month."
"Yet, the new president’s embrace of bailing out the Big Three without requiring their workers sacrifice to keep their jobs, especially when those concessions would just mean they will be treated like other American workers who work on assembly lines where the weather is warmer, would require him to spend substantial political capital that he might prefer to save for other battles."
"Of course, no one at the UAW — or for that matter among congressional Republicans who for political reasons would be just as happy if that Democratic Party patron disappears — will couch the decision about that portion of the proposed bailout in those terms."
"That would be tacky, and would raise emotional issues better left unsaid at this point as the future of the American auto industry hangs in the balance."
"But make no mistake about it: If the UAW can’t get a better deal for its members than workers get at Nissan, Toyota or Honda in Dixie, at some point those on the Ford, Chrysler and General Motors assembly lines up North may start wondering why they are paying union dues."
"A Last-Ditch Opportunity
The irony is that all this comes at a time when both friends and foes of the union movement have viewed the election of Mr. Obama and a heavily Democratic Congress as a last-ditch opportunity."
"With 12.5% of U.S. workers – including just 7.5% of those in the private sector – belonging to unions these days, organized labor sees the coming years as a last chance to reverse a trend that has taken it from major political power broker to an oft-ignored voice, even within the Democratic tent."
"What ultimately happens to the car companies and the strings that will be attached to any federal bailout will be the best indication of whether the new Democratic majority will be willing and able to help unions grow, rather than continue to wither."
"It would be naive to think that the next four years offers anything but a throwback to yesteryear, when the unions and business groups battled it out for public opinion and favorable government-mandated rules relating to organizing and business operations."
"When President-elect Obama takes office Jan. 20, it will be the first time in 14 years that Democrats control both ends of Pennsylvania Avenue. These years have witnessed a growing global economy based on intense wage competition that has contributed to the further diminution of the union label in the U.S."
"Declining Union Membership
Roughly a third of workers belonged to a union when Dwight Eisenhower took the oath of office 52 years ago, the high water mark for organized labor in the U.S. When Democrats Lyndon Johnson, Jimmy Carter and Bill Clinton were inaugurated in 1964, 1976 and 1992, that share had dropped to 30%, then 28%, and finally 16%, respectively."
"The Obama administration would seem likely to be the most pro-union of the last half-century. During his campaign for the Democratic nomination, Mr. Obama said he would walk a picket line as president to show his solidarity with workers."
"Although he didn’t make any similar remarks after clinching the nomination, President-elect Obama is clearly much more committed to increasing the role and clout of unions in the American economy than Messrs. Johnson, Clinton, or Carter."
"All three of the most recent past Democratic presidents came from the South, which was never a bastion of organized labor."
"But whether the new president can revive a movement that has fallen on the hardest of times in a world where flexibility and wage competition have become the economic coins of the realm is another question."
"Business and labor are already girding for a gigantic fight over a union proposal to do away with secret ballots in union elections. Business, which calls the proposal the biggest revision of labor laws in the last 75 years, says it would allow union organizers to publicly pressure workers to sign election petitions."
"Union leaders say the secret ballot requirements are biased in favor of management. If the change becomes law, labor thinks unions can organize many industries that are mostly non-union."
"The structure of any final deal to save the auto makers — and what it will require from the UAW members – will be an early indication of whether the Obama administration will be able to do anything to reverse the decline of unions in America."
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