Supplemental Job Displacement Benefit vouchers FAQ

Sunday, January 2, 2005 | 0

2005 promises to be a very interesting year with substantial changes to all aspects of the workers' compensation system. We have survived all previous attempts at reform and will do so again - with just a little dose of luck!

Supplemental Job Displacement Benefit (SJDB) vouchers - FAQ

We have neither regulations nor case law to guide us, so there are a lot more questions than answers about vouchers and how to meet requirements. The following are the questions I get most frequently followed by my answers (subject to change when we get regs and case law, of course).

1. Since the DWC has not issued regulations, do I really have to send notices on 2004 cases? The fact that lack of regulations may serve to mitigate penalties does not excuse the employer or insurer from its obligation to provide statutorily required information to the injured worker. Employers/insurers must make a "good faith" effort to provide eligible injured employees with a Notice of Potential Rights, an Offer of Modified or Alternative Work (if required and appropriate), and a Voucher where the employee is eligible. Since there are no regulations, the employer can draft its own letters and forms or use existing ones such as the RU-94 for an offer of modified or alternative work. Failure to provide any notices or offers will likely subject the employer/insurer to the maximum penalties, once these are established. [Note: The DWC initially proposed penalties ranging from $1000 to $5000 for failure to send the Notice of Potential Rights or a voucher when due.]

If you need letters immediately, Leno & Associates has drafted a set of notices in Word format that can be used until the DWC finalizes its regulations sometime in 2005. The letters are available for $100 and can be sent to you via e-mail for immediate use.

2. Is it really necessary to send the Notice of Potential Rights via certified mail? Certified mail is an expensive and time-consuming process. Sending so many letters via certified mail is expensive and it requires a lot of clerical time that could be used on other critical tasks. Unfortunately, the statute (L.C. section 4658.5(c)) specifically requires the use of certified mail so there is no choice in the matter.

3. Some of my cases are on and off TD multiple times; do I have to send a Notice of Potential Rights each time I stop TD? This is a very tricky issue. The technical answer is "No." The Notice of Potential Rights is only due after the last payment of TD. The problem is, how do you know when the last payment will be? If you guess wrong, an injured worker might be eligible for a voucher even though s/he is able to return to their regular duties. Such an occurrence is certain to cause problems with your insured employer. The safe course of action, despite the expense and extra work, is to send the Notice each time TD ends.

4. The injured worker is P&S and TD has ended but the treating physician has yet to provide work restrictions. What should I do? At minimum, send the Notice of Potential Rights. The real issue, of course, is whether the employee will need job accommodation and, if so, whether the employer can offer medically appropriate work (you need work restrictions to make these determinations). The statute doesn't address delays and it is unknown whether the regulations for 2004 will address the equivalent to the pre-2004 "delay" notice. My suggestion would be to create a delay notice advising the employee that you need work restrictions from his/her doctor to assist with the return to work determination and you will provide an answer as soon as you can obtain the necessary information.

5. What if it takes more than 30 days to obtain the necessary information to make the offer of modified or alternative work? My suggestion would be to make the offer anyway, even if it is late. Vouchers will not be available until the employee's workers' comp case is resolved, so we may find many more workers motivated to return to work in the positions offered. The employee has the option to reject the offer and take his/her voucher. At worst, the employee accepts both the job and the voucher (it appears that an employee may be entitled to a voucher if mandatory notices are late). And this "worst case" scenario may not be all that bad. Just because the employee gets a voucher doesn't mean s/he will use it. Even if the voucher is used, it seem likely that the comp case will be settled more quickly and amicably when the employee is back to work and has hope for the future because s/he is looking forward to improving his/her education and skills.

6. The employer has modified work for the employee but the work is seasonal and the start date will not fall within 60 days from the last TD payment. Should we offer the job or just provide the voucher? The Legislature did not consider seasonal workers when it created the voucher so the 60 day return to work requirement would seem to require provision of a voucher whenever the seasonal employer cannot provide a start date within 60 days of the last TD payment. The DWC does seem inclined to make an exception for seasonal workers, but without final regulations there is no guidance and certainly no guarantees. Nonetheless, I would suggest offering the job. If the employee accepts the offer, there is no problem. If the employee rejects the offer, the issue of the voucher remains "in play" until the case in chief is resolved.

7. The injured employee is P&S, has permanent disability, and the employer is unable to offer modified or alternative work. When am I required to provide the voucher to the employee? L. C. section 4658.5 indicates the voucher is available when the amount of PD is known and that happens at the time of a C&R agreement or an F&A by the Board. The voucher therefore is not due to the employee until the case in chief is resolved. The insurer and employer can agree to provide the voucher earlier (preferably as soon as the employer determines it cannot provide modified or alternative work). Providing the voucher closer to the P&S date makes it more usable by the injured worker and may serve to provide the employer with a buffer against a discrimination claim under the Fair Employment & Housing Act.

8. The injured employee is P&S, has PD, but is released to regular duties; however, the employer has had a substantial reduction in force so the employee no longer has a job. Is the employee entitled to a voucher? Probably not - but the issue will likely require clarification via case law. L. C. section 4658.5(a) indicates that the requirements for a voucher are that the employee has PD and does not return to work for the employer within 60 days. This seems to suggest that the injured worker in this question is entitled to a voucher. However, the exception to the requirement involves offers of modified or alternative work, which our injured worker in this example does not need. An injured worker who is released to full duty presumably does not need to upgrade skills, unlike the worker whose injury requires job accommodation. Absent case law to the contrary, we would therefore assume that the worker who can return to regular duties does not receive a voucher, even where s/he has no job to return to. Note, however, that this employee would be entitled to a 15% increase in PDAs pursuant to L. C. section 4658(d).

9. Can the voucher be settled? Most attorneys (both applicants and defense) have assumed that the voucher can be settled because there is no prohibition against settlement. However, the voucher is described as being "non-transferable" which could serve as a bar to settlement. Note that the voucher does not allow payment of money directly to the injured employee, except as reimbursement for training obtained at an approved training facility. Otherwise, the only parties to be paid are approved schools and vocational counselors. It could be argued that these requirements serve as an effective bar to settlement. However, if both the applicant and the employer/insurer wish to settle cases, who would bring a case before the Board? It appears that cases will be settled, whether or not settlement was intended by the Legislature.

10. The injured employee has submitted receipts for training. What are the requirements and criteria for payment? As long as the expense was incurred after injury and the school is an approved training facility, the employer/insurer must reimburse the training expenses within 45 days. Reimbursable expenses include tuition, required fees, and the costs for required books, training materials, and equipment up to the limits of the voucher. Employers/insurers should note that the employee can continue to register for and take classes or training programs to the limit of the voucher. Reimbursement may not be denied simply because the employee previously completed a training program.

If you have other questions regarding the voucher, please submit them via e-mail and we will attempt to answer them in future articles.



Contributed by vocational rehabilitation expert Allan Leno, 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.