Workers' Compensation Defense & Penalty Claims

 

 

We specialize in Workers’ Compensation Defense, representing employers (businesses, organizations), carriers and Third Party Administrators located both within California and those out of state, involving conventional Workers’ Compensation claims, as well as penalty petitions filed against them.

 

Penalty claims include but are not limited to such matters as Labor Code 132a petitions, Serious and Willful Misconduct, and illegally uninsured employers.

 

We have decades of experience in a range of practice areas, and have been specializing in the defense of Workers’ Compensation claims and related penalty petitions since 2004.

 

We have handled hundreds of new and mature defense files, from inception through case conclusion. We have made hundreds (if not thousands) of appearances before the WCAB throughout the state, as well as in civil and criminal courts for Discovery, Law & Motion, Mandatory Settlement Conferences, Vocational Rehabilitation, trials, Expedited and other hearings.

 

We regularly appear before the WCAB all over California, most often in venues throughout Los Angeles County, the Inland Empire, Ventura and Orange County.

 

We’ve also taken hundreds of depositions, including employees, medical experts and others, and defended dozens more.

 

Workers' compensation is the nation's oldest social insurance program: It was adopted in most states, including California, during the second decade of the 20th century. The Workers' Compensation system is based on a trade-off between employers and employees. Employees are entitled to receive prompt, effective medical treatment for on-the-job injuries or illnesses no matter who is at fault and, in return, are prevented from suing employers over those injuries.

 

As a result, California employers, with rare exception, are required by law to have Workers' Compensation insurance, even if they have only one employee. And, if the employee get hurts, sick or dies because of work, the employer is required to pay for Workers' Compensation benefits. Workers' compensation insurance provides basic benefits, including medical care, temporary disability benefits, permanent disability benefits, supplemental job displacement benefits and a return-to-work supplement, as well as death benefits.

 

The vast majority of Workers' Compensation claims are resolved without any problems. However, sometimes a disagreement can arise between the employer and employee over issues such as whether the injury was sustained on the job, medical treatment or how much in benefits the employee is entitled to receive.

 

An out-of-state employer may also need Workers' Compensation coverage if they have any employees regularly working or residing in California, or if the parties enter into a contract of employment here.

 

Having a claim that is litigated in the Workers’ Compensation system can be expensive and time-consuming. Working with us you can save substantial resources, time and effort. If the employer has Workers’ Compensation insurance, and our firm is not on their panel of pre-approved names, the employer can request that their carrier retain our firm on one or more claims, which is usually granted, until we’re added to their pre-approved list.

 

Uninsured Employers:

 

As a general rule, the law requires that an employer be insured for Workers’ Compensation in California. An illegally uninsured employer faces numerous substantial potential criminal and civil penalties, the more so if a Workers’ Compensation claim is filed. This is discussed below.

 

That being said, for some claims, the law forbids insurance coverage. These generally include claims alleging more than ordinary fault or negligence, often referred to as “willful” conduct. One example is unlawful discrimination in Workers’ Compensation actions, aka a Labor Code 132a petition. Another is alleged Serious and Willful Misconduct by the employer.

 

Under Labor Code section 132a, as with petitions for Serious and Willful Misconduct, alleged willful illegal acts of the employer are not insurable, and businesses large and small must fend for themselves without that protection.

 

The employer frequently has to pay for its own attorney, although occasionally the carrier insurer will provide the representation (but it will not cover the liability).

 

Our experience is that often 132a claims are entirely without merit, knee-jerk reactions filed at no risk to the employee, with the employee’s attorney seeking to use the risk of a prolonged costly litigation and liability from this uninsurable claim as leverage to resolve both the discrimination case and the conventional Workers’ Compensation injury claim.

 

Both Workers’ Compensation claims and related penalty claims, including but not limited to a132a petition, and Serious and Willful Misconduct, are quite different from civil law, are highly technical and generally not familiar to a business counsel or civil litigator. Since the law and procedures are so distinct, an attorney not specializing in the field is often lost and unable to get up to speed to effectively represent their client.

 

An additional penalty claim involves a conventional Workers’ Compensation claim against employers who do not have Workers’ Compensation insurance at the time of the alleged industrial injury, and are not permissibly self-insured.

 

Civil and criminal penalties for illegally uninsured employers:

 

We also represent illegally uninsured employers: business and non-business entities that, for a variety of reasons, legally should be but in fact do not have insurance coverage for a conventional Workers’ Compensation claim that is filed against them. This is a potential nightmare that should be promptly addressed.

 

If an employer willfully fails to obtain Workers’ Compensation (WC) insurance, and no exemption applies (e.g. not legally “Self Insured,” posting a bond, etc.), substantial civil and criminal penalties can be assessed by the Court, in addition to the amount of the WC benefits owed. For example, Labor Code section 3710 et. seq., imposes a penalty of a 10% increase in the amount of benefits awarded and payment of the employee’s attorney’s fees. There are more penalties, both civil and criminal.

 

Criminal penalties can also be imposed. For example, the Labor Code makes the failure to pay WC benefits a misdemeanor: punishable by up to one year in county jail, or by a fine of up to double the amount of the insurance premium, as determined by the court, that would otherwise have been due to secure the payment of compensation during the time compensation was not secured, but not less than $10,000, or by both that imprisonment and fine.

 

For a first conviction, the person may also be charged the costs of the investigation at the discretion of the court. This could well be the total amount of attorneys’ fees and costs (i.e. a deposition, medical records, an investigator, etc.) incurred by the Uninsured Employers Benefit Trust Fund. Where the employer is uninsured, the UEBTF, a quasi-government organization, takes over the defense of the case, pays the bills and any benefits to the employee that are owed.

 

Furthermore, the allegedly injured employee of an illegally insured employer has several remedies: they can bring both a Personal Injury / civil action in the Superior Court, and may also concurrently pursue WC benefits before the WCAB against the UEBTF. In addition, the rules of pleading and proof differ significantly than those of a typical civil action when there’s no insurance: e.g. the employer forfeits common law defenses to a negligence claim; and the Statute of Limitations is extended from one to three years.

 

What’s more, the scope of permissible damages is substantially wider and deeper in a personal injury or civil action than in a WC claim. A WC claim involves a social compromise where the allegedly injured employee does not have to prove anyone’s fault to get benefits where there’s an accident or ordinary mistake, so long as the injury occurred during the course and scope of the employment; however, the workers’ damages are more restricted. For example, damages for “pain and suffering” are routine in a civil case but not allowed in a WC action. [In a routine moderate auto accident case, P&S damages often range between 2 – 4 times the amount of the medical bills].

 

In addition, lost income or wages are much lower in a WC case, as 2/3 of the average weekly wages over the past 12 moths are paid, subject to a ceiling or maximum amount per month. They are also limited by law to a maximum of 104 weeks / two years in duration. There are no such limits in a civil action, with the plaintiff recovers 100% of current wages lost, as well as the estimate future loss of earnings.

 

What’s more, the judgment aka a certificate constitutes a valid lien that can easily be attached to real property, a business, bank account, etc., with the same force, effect and priority as a judgment lien.