Young: Scaling Back

Tuesday, June 21, 2022 | 0

One of the most controversial 2022 California workers’ comp bills is SB 1127. But that bill has now been considerably scaled back.

Julius Young

SB 1127 initially provided for a reduction of the time to accept or deny non-presumption claims, from the current 90 days to 60 days. And the time to accept or deny presumption claims would have been reduced from 90 to 30 days.

But that was before June 13. Now SB 1127 has been amended. The time to accept or deny presumption claims would be reduced from 90 to 75 days. The time to accept or deny non-presumption claims would remain at 90 days, the current standard.

I attended the employer-side meeting, the Disneyland conference of the California Coalition on Workers’ Compensation. Clearly, the CCWC folks were greatly concerned about the reduced timelines under SB 1127.

On the other hand, applicants' attorneys and labor groups were excited by the bill’s provisions, believing that long timeframes to accept or deny claims bake delays into the comp system, thereby harming workers. 

With the amendments, SB 1127 would do nothing to help non-public safety officer workers. In non-presumption cases, employers will still be able to delay decisions on claims for up to 90 days. 

The system should do better than delaying decisions on many cases for so long.

Also trimmed back are the proposed penalty provisions in SB 1127. At one time, it provided for a penalty of up to a maximum of $100,000 (five times the amount of benefits unreasonably delayed due to the rejection of liability in presumption cases). The current version of SB 1127 would reduce this to five times the unreasonably delayed benefit but no more than $50,000.

The bill is currently with the Assembly Insurance Committee.

Public safety unions that benefit from the presumptions clearly have a lot of political juice with the Legislature. Although the current bill is less expansive, it is still very favorable to the interests of their public safety members.

I expect a lot of backroom wheeling and dealing at the Capitol and with the governor’s office on this one.

The bright spot in the amended bill:

“This bill would require, on or before July 1, 2023, the division to identify and amend its existing data collection processes to include collection of the date on which a claimant is notified of acceptance, denial or conditional denial of liability.”

Presumably, with more data collection, the Legislature will be able to better evaluate future policy changes.

Julius Young is an applicants' attorney and a partner for the Boxer & Gerson law firm in Oakland. This column was reprinted with his permission from his Workers Comp Zone blog on the firm's website.