Last month I noted in a post "Nail Biters" that Assemblywoman Mary Salas had nudged out former Assemblyman Juan Vargas in a race for the Democratic nomination in the 50th Senate District.

Not so. The margin between Salas and Vargas was not more than a few hundred votes. As some slow returns filtered in, Vargas took a small lead.
There were over 12,000 Riverside County ballots that had not been tallied.

With those ballots in, Vargas had a 22 vote lead. Vargas declared victory today in the primary. The 50th stretches across parts of San Diego, Imperial and Riverside Counties. The winner of a Democratic primary in the district is basically assured of election in November.

There's word tonight that Salas has requested a recount.

This is a bitter battle that has attracted major interest from various California interest groups. Vargas attracted large amounts of cash from insurance interests and tort reform groups.

Millions, actually.

Salas was backed by applicant attorneys, trial lawyers and most unions. I'm aware of only one union backing Vargas, AFSCME.

Although I cover some of the legislative background from time to time, you, dear reader, may be wondering why the fascination with this race.

Consider the picture. Business interests smell blood.

They seek a more receptive audience in the legislature if there is a Brown administration. The goal will be to find some Democratic votes to block legislation.

And if Whitman is elected, those interests seek Democratic friends who will join with Republican minorities to move legislation.

Holding onto Democratic California Senate seats is not a forgone conclusion.

State Senator Dean Florez is termed out. Kern County Supervisor Michael Rubio is seeking to replace him, but issues have arisen regarding whether Rubio resides in the district.

In a coastal counties district, State Senator John Laird survived to fight another day in a runoff, but faces a tough race against the GOP's Sam Blakeslee. The runoff is scheduled for August.

It's all inside the beltway River City stuff that many readers may find as interesting as watching paint dry.

But there's a reason why people who do care are pouring millions into these races. They matter.

Politics is sometimes played as a blood sport. These races are prime examples.

Stay tuned for my piece on the Top 10 developments in California workers' comp in the first half of 2010.

Julius Young
www.boxerlaw.com

Hey, it's not Aaron Burr versus Alexander Hamilton. No dueling pistols here.

But we are in modern times. We have dueling lawsuits.

This time it's Arnold Schwarzenegger versus State Controller John Chiang.

Schwarzeneger has filed to get a court order to force Chiang to cut state woker pay to minimum wage levels while the state has no budget. Chiang has filed his own action, seeking to throw out the order to cut salaries that was sent to him from Schwarzenegger's Department of Personnel Administration.

Here's more on the Chiang lawsuit in a piece by Wyatt Buchanan from the San Francisco Chronicle:
http://www.sfgate.com/cgi-bin/article.c ... &tsp=1

It's a duel of great interest to the folks who work for DIR/DWC and the WCAB.

Stay tuned.

Julius Young
www.boxerlaw.com

As a blogger on California workers' comp issues, I sometimes get interesting calls.

Yesterday's call? From doctor's group (to protect confidentiality, I'll mask any particularizing details).

The medical practice is debating whether to join an MPN and whether it wants to treat injured workers under California's workers' comp system.
The caller was seeking input from sources with knowledge about California's workers' comp system.

At first, I envisioned a need to educate the caller about issues that concern providers....utilization review....fee schedule issues....medical treatment guidelines.....lien claims.......

I quickly realized that was unnecessary. The caller already understood what was going on in those areas quite well.

The caller was really looking for something else. What's the benefit in treating workers' comp cases? Why should our doctors do it?

This physician noted that the medical group was already very busy with non-workers' comp patients. The group was a member of various HMO
groups.

Why should they take workers' comp? Was it worth getting involved in the hassles of paperwork documentation and authorization disputes?

I wondered whether their HMO contracts bound them to treat injured workers. The caller didn't think so.

I noted that with changes coming under Obamacare, healthcare reforms could affect treaters in unanticipated ways. Perhaps the doctor group wanted to diversify into workers' comp.

The caller was unmoved.

Did the doctors feel a sense of civic duty to treat some share of the state's working folks? After all, many of the doctors live in the community. The workers they would be treating serve the doctors in various capacities. I appealed to the communitarian, altruistic impulses of the caller.

The caller was unimpressed.

I tried an economic argument. Perhaps, I noted (not having stats to back up my hypothesis) if the doctors did not take comp cases, would that have a negative effect on the economics of local MRI facilities and surgicenters which may be partially owned by these doctors? Would other treating doctors refer patients to alternative surgicenters and MRI centers instead, negatively affecting the calling doctors' investments?

The caller noted that this argument could resonate with some of his partners, but might not be compelling.

As the call ended, I wondered how often this debate goes on in partnership meetings at doctors groups. Was the call just an "outlier", or was it a mainstream wake-up call showing deep dissatisfaction among doctor groups with practice in the comp system?

Julius Young
www.boxerlaw.com

State Controller John Chiang says he'll continue to resist Schwarzenegger's efforts to impose the minimum wage on state workers as long as there is no state budget.

But Chiang now has to devise a legal strategy to deal with the California Court of Appeal 3rd District decision rendered yesterday in Gilb v. Chang.
In that decision, 3rd DCA justices Rick Sims, Vance Raye and Arthur Scotland upheld a ruling by Sacramento Superior Court Judge Timothy Frawley that allows the Department of Personnel Administration to order Chiang to cut state worker wages when there is no state budget.

Here's a pdf of the ruling:
http://kqed02.streamguys.us/anon.kqed/b ... DCApay.pdf

Chiang has noted that the state's computer and accounting system do not make it feasible to do the reductions that have been ordered.

The 3rd DCA opinion was rendered in connection with the 2008 Schwarzenegger order to lower state worker salaries due to the 2008 budget increase.

But in response to Chiang's claims about the computer and accounting systems the 3rd DCA noted:
"We decline to consider the feasibility issue, because it involves variables that may or may not recur in the future, depending on the content of any future pay letter by the DPA, and the state of the evidence in any future litigation. We will not speculate as to the future capabilities of the payroll system that will be in place at the time of future budget impasses. We recognize the Controller's payroll chief attested that a pending upgrade (the 21st century Project) will not solve the problems that make unfeasible compliance with the DPA's interpretation of White v. Davis. However, that does not necessarily excuse or preclude the Controller from implementing other changes to make compliance feasible."

In coming days we'll see whether Chiang appeals the 3rd DCA decision to the California Appeals Court or whether he pursues an injunction in Sacramento Superior Court against the 2010 pay cut order, or both.

Chiang has vowed to fight. It's a fight of great interest to employees of the WCAB and the Division of Workers' Compensation.

Here is Chiang's response to the order from Debbie Endsley, Director of the Department of Personnel Administration:
http://www.sco.ca.gov/Files-EO/07-02-10lettertoDPA.pdf

And here is the brief statement Chiang made on the 3rd DCA ruling, noting that it is not a simple software matter to reduce pay and then comply with wage payment timelines once a budget is enacted:
http://www.sco.ca.gov/eo_pressrel_contr ... uling.html

Here's a link to the text of the 2003 California Supreme Court ruling in White v. Davis (133 Cal.Rptr. 2d 648, 30 Cal 4th 528, 68 P.3d 74):
http://scholar.google.com/scholar_case? ... i=scholarr

Stay tuned.

In a few days I'll be doing a post of the top 10 developments in California workers' comp for the first half of 2010.

Julius Young
www.boxerlaw.com
(have an iPhone or iPad? you can create a workerscompzone.com widget/button by clicking on the cross to the left of the url box)

Today Governor Schwarzenegger made good on this threat to cut state employee salaries if there's no state budget.

Schwarzenegger has ordered most state worker pay cut to the federal minimum wage until there is a budget. That is likely to be after a long, hot summer.

The Administration claims that it can do that under the ruling in White v. Davis, a 2003 California Supreme Court case.

Based on the experience we've seen with the state worker furloughs over the past year, it's unlikely that "user funded" agencies such as the California Workers' Compensation Appeals Board will be exempted if Schwarzenegger has his way.

Since the budget chasm is so wide, reaching a budget compromise in an election year may set all records for delay. So even if state workers are eventually given back pay after a budget deal is struck, the economic consequences could be devastating for many of the folks at the WCAB and at the DWC.

Wait. There's more.

According to a piece by Jon Ortiz in today's Sacramento Bee, "Some employees, such as doctors and lawyers, would get no pay because federal exempts them from any minimum wage requirement". Huh?

Would that include judges too?

But State Controller John Chiang, a Democrat, has announced that he will resist the Schwarzenegger order. There's a pending case in the Court of Appeal over the legality of a similar order by Schwarzenegger in 2008.
So this battle between Schwarzenegger and Chiang may be settled by the courts, perhaps months from now.

It's all part of a Kabuki dance as the state tries to stay afloat.

If you see your favorite WCAB clerk or judge popping a few Valium, now you know why.

Here's a link to the Schwarzenegger minimum wage pay letter:
http://blogs.sacbee.com/the_state_worke ... letter.pdf

Stay tuned.

Julius Young
www.boxerlaw.com