Right-To-Work Regulations and SJDB Vouchers

Saturday, September 9, 2006 | 0

By Alan Leno

The comment period for proposed AD Regulations Sections 10002 and 10003 for offers of regular work ended Aug. 7. These proposed regulations are being revised by the Division of Workers' Compensation and returned to the Office of Administrative Law (OAL) for further review. Final approval is expected sometime in September. Once OAL signs off on the proposed regulations, they will be registered with the Secretary of State and an effective date published.

Claim administrators should note that the DWC AD Form 10003 Offer of Work is not yet required; however, it would be advisable to send the applicant a brief letter to document a return to regular duties where weekly PD payments are reduced by 15% pursuant to L.C. Sec. 4658(d).

SJDB Vouchers - More FAQs

An injured worker (2004 DOI) is entitled to a voucher if precluded from his/her usual and customary duties and the employer cannot provide modified or alternative work. Can the employer/carrier settle the voucher by giving the applicant the allotted amount? Does the employee have to be represented by an attorney?

There is no prohibition in the Labor Code against settlement of the voucher so the DWC has taken the position that the voucher can be settled via a compromise and release agreement (see AD Reg 10133.52). The new C&R agreement form includes a provision for settling either VR (pre-2004) or the SJDB voucher (DOIs on/after 1/1/2004). The voucher cannot be settled via an F&A or Stipulated Award. Claims administrators should note that there are no rules on the amount of settlement; it is up to the parties to negotiate the amount of settlement, just as they do for the case in chief. I have seen the voucher settled for as little as $1 up to the full amount of the injured worker's entitlement.

Unlike VR, there is no requirement for the injured worker to be represented by counsel in order to settle his/her voucher entitlement. In pro per injured workers can, and do, settle their voucher rights.

The Labor Code and AD Regs require the claims administrator to send an injured worker the Notice of Offer of Modified or Alternative Work (AD Form 10133.53) within 30 days of the termination of TD. Injured workers often go back to work in transitional jobs prior to P&S. Is the claims administrator required to send the 10133.53 form? Does the employer have to engage in the "interactive process" when the employee returns to transitional work?

This really two questions. First, the Labor Code should have said the 10133.53 was due within 30 days of P&S but, unfortunately, it says within 30 days of the last payment of TD. Because the wording is specific, the DWC believes the 10133.53 form must be sent within the 30-day timeframe whether the employee is returning to transitional work or permanent modified or alternative work. This makes no sense for transitional work but the DWC's attorneys believe the statutory language leaves them no choice. If the employer/claims administrator does not send the 10133.53 for a transitional job and the employee later needs a permanent modified/alternative job, the employer loses the right to use the 10133.53 (If the employee returns to regular duty, the 10133.53 becomes irrelevant) and the employee will be entitled to a voucher, even if he returns to work in a permanent modified or alternative position...

This presents a problem for employers, particularly those with unions and/or civil service type employment rules. It is also a problem for injured employees because the conditions stated on page 1 of the 10133.53 do not apply to transitional or temporary assignments (transitional jobs do not last for one year, there is no 85% wage requirement, etc.). We also do not have final work restrictions so how can the employer offer a "permanent" modified/alternative job? The best advice I can give to an employer is to use the 10133.53 as DWC requires but be sure to specify in the "Duties Required" and "Description of Activities" sections on page 2 that the transitional job is temporary (it would be appropriate to specify the time frame) and that the need for permanent job modification or reassignment will be evaluated when final work restrictions become available and a permanent offer considered at that time. If permanent job modification is required after P&S and work is available, the employer/claims administrator can then send a "revised" offer to the employee.

Regarding the second question, an employer is not required to engage in the "interactive process" for a temporary or transitional work assignment, although it wouldn't hurt. An employer has the right to assign any employee to temporary work, as long as the nature of the assignment isn't demeaning or punitive. Please note that the "interactive process" is an FEHA requirement and generally is not within the purview of a claims administrator (unless the employer is permissibly self-insured/self-administered).

What is the "interactive process?" How does it work?

A complete description of the interactive process would take too much time and space to discuss here. And it would be bad for business (my business) to spell out every detail of the process. The essential elements of the process include the following: (1) recognize the need for job accommodation or reassignment, (2) invite the employee to participate, (3) review the employee's job duties and work limitations, (4) obtain a job analysis/use available resources as needed to assess return-to-work options, (5) identifying and procure any required assistive or adaptive devices required for the workplace, and (6) offer the modified or alternative position to the employee. And, of course, document everything. This process can take as little as an hour or two or it can take many hours spread over days or weeks. Available case law suggests that an employer must be very thorough to meet its obligations under FEHA.

What labor code or regulation addresses the requirement to send an SJDB voucher within 25 days of an award? We are getting requests for tuition reimbursements prior to an award -- sometimes we don't even know what the value will be for the voucher. Are we obligated to pay prior to an award?

In a word - No. The requirement to pay within 25 days of the award can be found in AD Reg 10133.56(c). A claims administrator is not required to pay tuition to a school or reimburse the employee for tuition paid prior to the award.

If an employee is returned to work immediately in a modified position and there is no lost time but the employee has PD, at what point is the Notice of Rights due? When is the 10133.53 Mod/Alt Offer due? How would this situation impact the L.C. Sec. 4658(d) +/-15% requirement?

Where no TD has been paid (as in this no lost time case), the claims administrator should send the Notice of Potential Rights (10133.52) as soon as there is evidence of the existence or probable existence of permanent disability. For those who may be hesitant to send the notice prior to ironclad evidence that there will be PD, remember that the Notice of Rights is informational only; it is not like the Notice of Potential Eligibility that we sent on pre-2004 QIW cases. The NOPE was an offer of benefits and services where the SJDB Notice of Potential Rights tells the applicant a bout a benefit he might get if all conditions are met.

Since no TD has been paid, you can send the 10133.53 Notice of Offer of Modified or Alternative Work as soon as you have final work restrictions. While this situation is not addressed by statute or regulation, I would recommend sending the offer no later than 30 days from your knowledge of the final work restrictions.

The 15% PD adjustment cannot be taken until the employee is P&S, even though the employer provided modified or alternative work immediately. L.C. Sec. 4658(d) specifically uses the P&S date to start the PD adjustment process. You also cannot start the 15% PD reduction until there has been an actual offer of the position (in this case via the 10133.53).

Can an employer take the 15% reduction in weekly PD payments where the employee opts to retire rather than returning to work in available modified or alternative work? Also, what is the employer's obligation to engage in the interactive process with this employee?

The employer should be able to take the 15% PD reduction IF it makes an offer of available modified or alternative work. This means the employer needs to complete the DWC AD Form 10133.53 Notice of Offer of Modified or Alternative Work and send it to the employee. The employee has 30 days to accept, reject, or not respond to the offer. The employer can take the 15% reduction when the offer is made. Absent case law or further regulations, I think it would be a mistake for the employer to forego the 10133.53 because the employee has already retired or has made his intent to retire known.

Regarding the FEHA requirement to engage in the "interactive process," an employer could argue that there is no need for this process because the employee has already removed himself from employment consideration by virtue of the retirement decision. However, I would suggest that the employer invite the employee in to discuss return-to-work (i.e., initiate the interactive process). If the employee is serious about retirement, it is probable that he will decline which provides documentation for the employer. It would also help remove any argument that the retirement was "forced."

Is an employer required to offer a modified or alternative position to an employee who has been terminated for cause? Must this employer engage in the "interactive process?"

These questions get into the realm of policy decisions for employers. L.C. Sec. 4658(d), Sec. 4658.5, Sec. 4658.6 do not address what we might think should be logical exceptions to the statutory requirements for 15% PD increases and the obligation to provide a voucher. If an employer fired an employee for "cause," it would not want to offer a modified or alternative position and it could argue that such an employee should not be "rewarded" with a 15% PD increase or with an SJDB voucher. These seem like very logical and reasonable arguments and conclusions but there is no specific support in the statute or regulations. This means that the employer/claims administrator must make a policy decision about how it wishes to address such situations and then wait for case law (which will most certainly follow). At my company, I would not offer an employee terminated for cause a modified/alternative job and I would also not adjust PD upward nor provide a voucher. Of course, my company has no employees so my decision is safe. Employers need to consult with their attorney and make a good faith decision that will apply to all similarly situated employees (ex-employees).

Must the employer engage in the FEHA interactive process? The interactive process requirement applies to employees. Assuming that the termination for cause is bona fide and defensible, that individual is no longer an employee and is not eligible for re-hire so the interactive process requirements would not apply. I would advise the employer that it must be very confident in its termination decision because having the termination over-turned by the courts could expose the employer to a charge of failure to engage in the interactive process.

If an employee has 0% PD, is he entitled to an SJDB voucher? On one of my claims, the physician apportioned 75% of the disability to a 1995 claim, 15% to a 2004 claim, and 10% to a 2005 claim but apportions to non-industrial factors. The doctor goes on to indicate that the 2005 claim was an exacerbation and created no new disability.

I would say you have an unratable report. If, when this report is clarified, there is disability of industrial causation occurring on/after Jan. 1, 2004, that serves to preclude the applicant from returning to his/her regular position and the employer cannot provide modified or alternative work, the employee would be entitled to a voucher. If the net result is 0% PD attributable to injury on/after Jan. 1, 2004, the applicant would not be entitled to a voucher. We are, in fact, seeing cases where there is 0% PD but the physician gives work restrictions but the employee is not entitled to a voucher because L.C. Sec. 4658.5(a) ties eligibility to the voucher to an award of PD.

DWC established an application procedure for counselors who wish to assist voucher-eligible injured workers with their re-training effort. To qualify as a VRTWC, an applicant must meet the education and experience requirements of AD Reg. Sec. 10133.50(a)(15):

A person or entity capable of assisting a person with a disability with development of a return-to-work strategy and whose regular duties involve the evaluation, counseling and placement of disabled persons. A VRTWC must have at least an undergraduate degree in any field and three or more years full time experience in conducting vocational evaluations, counseling and placement of disabled adults.

The application procedure and form are available at the DWC Web site. Go to
www.dir.ca.gov/dwc/SJDB/SJDB_Main.html and click on "Procedure for application for appointment as a vocational return to work counselor Adobe version". Qualified VRTWCs will have their contact information listed at the DWC Web site (the current list can be found at http://www.dir.ca.gov/dwc/SJDB/VRTWC_list.pdf.

Training

The National Association of ADA Coordinators announced its fall 2006 and spring 2007 national conferences. The fall 2006 conference will be held in San Diego from Oct. 30 through Nov. 3. The spring 2007 conference will be in Miami, Florida, April 23-26. Anyone interested in attending these conferences should contact NAADAC at (800) 722-4232 or visit NAADAC's Web site at www.jan.wvu.edu/naadac/index.html.

NOTE: The Nov. 3, general session in San Diego will be devoted to California's Fair Employment and Housing Act (FEHA) and its interaction with other statutes such as workers' compensation. This workshop is designed to assist employers with their FEHA compliance efforts but it would also be valuable to senior claims staff, rehab counselors, and attorneys who assist and/or provide advice to employers on their return-to-work efforts and policies. Interested parties can sign up for this session only or in combination with ADA sessions offered earlier in the week. Contact NAADAC at (800) 722-4232 for more information or visit NAADAC's Web site at http://www.jan.wvu.edu/naadac/index.html.

This column was contributed by vocational rehabilitation expert Allan Leno of Leno & Associates, (818) 370-8859, allanleno@leno-assoc.com.

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The views and opinions expressed by the author are not necessarily those of workcompcentral.com, its editors or management.