Minimum TD Rates and Volunteers

Sunday, June 22, 2003 | 0

The following question regarding TD rates for volunteer employees was posted to our Professional's Legal Forum. The editors at workcompcentral.com felt that this discussion is a timely and relevant topic for insurance professionals as it is an area that invites confusion across the professional spectrum:

Q: If a person is a volunteer employee of a non-profit hospital and the hospital does cover volunteers under their WC, does the volunteer exclusion still apply? As I understood it, volunteers were excluded unless the employer specifically covered them. Reading the recent article re: TD benefits, it specifically states even people with no wages can get the minimum TD rate. If volunteers are covered under a non-profit employers WC, are they considered an employee and is the minimum TD rate due, even with no wages? HELP! I did read LC 4453 (8), but have not able to get this answered clearly.

A - You have answered your own question. Once the employer chooses to cover volunteers (usually by a specific endorsement on the policy) the volunteers are covered for all statutory benefits. Accordingly, the volunteer is entitled to minimum TD rates for injuries on or after 1/01/03.

A - I think Samcat is very likely going to be correct that even volunteers, and those with no earnings will be entitled to TD at minimum rates (or else why are there minimum rates?) But the answer is complicated by some conflicting case law as well as rules of statutory interpretation.

There is some support for the concept that payment of full wages after an injury may allow payment of benefits at less than the minimum TD rate based on the concept that without wage loss there is no need to pay TD. The concept is supported by a WCAB en banc decision from 1988 (Cone v Zacky Pizza or something like that). However, the issue is more complicated than the actual case history.

Workcompcentral [has posted] an article reviewing this issue and discussing the interesting history and case law on the topic. I imagine this will run after the AB 749 series and should be available in a couple of weeks.

A - Some insurance companies who cover, e.g., hospital volunteers, have, in addition to "Coverage A and Coverage B," which covers almost all WC claims, a "Coverage C" endorsement. If you have a claim involving such a person you need to get a copy of the endorsement which typically covers candy stripers, "gray ladies" who pass out books, etc., or student nurses working for experience.

I ran into a case 20 years ago, got a copy of the endorsement of my insured's hospital, (I was a claim supervisor for Hartford at the time), and discovered Coverage C allows the volunteer an ELECTION to either pursue comp or file a personal injury or tort claim.

If there is a Coverage C, the injured person needs to be advised of the possibility of an election, otherwise they could collect w/c benefits, then file a tort claim! Also, the statute of limitations on the tort claim will be tolled indefinitely until they are advised.

I agree that if the injury is on or about 1/03 they would qualify for the minimum TD rate, or if the injury is 2 or more years ago, L.C. 4661.5 would mandate a minimum TD payment now.

The case Jake had in mind is Hayes 54 CCC 334 and later 18 CWCR 269, 55 CCC 352 which holds an employer can continue to pay the same wage as before an injury and the carrier has to pay the difference between that payment up to the minimum rate in effect on the date payment is made.

Q - Thank you for the help. I suspected as much, but my client is balking at the thought of paying a "volunteer" with no earnings minimum TD, so I need to be very clear before I make a recommendation. The question remaining for me, is in the 2003 LC tables the chart for TD rates (including minimum) starts at .01, not at 0.00, leading me to assume that a person would have to earn at least .01 to qualify for the minimum rate. But then 749 contradicts this! I know PD is payable at minimum with no earnings, but TTD? I'm not in a hurry to set precedent here.

I have revised Table 14 annually since asked to do so by Matthew Bender in 1991 (for the 1992 edition). Your point about the table beginning in 2003 with "0.01" is well taken, and I think I will revise it for next year (unless Lexis/Nexis asks me not to do so.)

Normally, people work for pay and, normally, volunteers are not covered. Thus there are normally SOME earnings, sometimes. However, seasonal workers with "$0.00" earnings in the off season will get $126.00/wk minimum. When I wrote the 2003 changes to the table, I was thinking of an annual average wage used in the off season when earnings were "$0.00" and, thus there would be some earnings to consider and to which the table as written would apply. Now, I am not so sure. "$0.00" makes more sense.

I suggest the employer be told that if their policy requires them to cover volunteers, they need to be treated as any other employee and paid the minimum. If this is not done, they will owe an L.C. 4650(d) 10% increase on all delayed TD, plus probably a L.C. 5814 10% increase on all TD past present and future!

Last of all, I am a paralegal, not an attorney and my opinions are my own. Rely on them at your peril...but I bet I'm right! Perhaps the case I cited before that Jake was thinking about, the Hayes case may convince your employer.

Last of all, be certain to get a copy of the endorsement that covers volunteers. It is absolutely critical. I'll bet it lays out how earnings are to be calculated...based on the value of the services rendered in terms of what someone would be paid to do the job. Then you will have a projected "wage" to apply to the table, instead of $0.00.

A - I can't help but think that regardless of the official status of the volunteer, that there wasn't some remuneration that could otherwise be construed as 'compensation for services', such as free food, t-shirts, or something other than cash that was given to the volunteer as appreciation for his/her work, that has a fair market value sufficient to be 'wages'.

Also, remember the catch all in 4453: (4) where the employment is for less than 30 hours per week, or where for any reason the foregoing methods of arriving at the average weekly earnings cannot reasonably and fairly be applied, the average weekly earnings shall be taken at 100 percent of the sum which reasonably represents the average weekly earning capacity of the injured employee at the time of his or her injury, due consideration being given to his or her actual earnings from all sources and employments. (Italics added).