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Workers’ Compensation Legislation Affecting Public Employers Continues to Move through the Capitol

Will Governor Newsom be More Accommodating than Governor Brown?

June 14, 2019
In the 2019 Legislative Session, the Legislature has introduced a series of measures in the workers’ compensation space that will drive up employer cost and expand the system to pre-2012 reform levels.
 
The predominant area we have seen this year surrounds the proposed expansions of presumptions within the workers’ compensation system — backed by the California Professional Firefighters (CPF), the Peace Officers Research Association of California (PORAC) and/or the American Federation of State, County and Municipal Employees (AFCME). While the League continues to work with the authors and sponsors to pursue amendments and alternative solutions, Capitol reality is that the Legislature will likely pass these measures, leaving the tough decisions to Gov. Gavin Newsom.
 
Presumptions Are Cost Drivers
 
California workers’ compensation law provides for several presumptions, which apply specifically for safety and law enforcement positions. In workers’ compensation law, an injured worker generally has the burden of proof. The injured worker’s burden is to prove that the injury was caused by “reasonable medical probability.” This burden essentially means “more likely than not.”
 
The presumptions afforded to safety and law enforcement officers allow them to gain an evidentiary advantage in proving industrial causation. One of the biggest challenges for employers for presumptions is that it takes cost-containment measures off of the table such as the ability to use apportionment in assessing the causation of the injury — especially when the use of ‘4850’ time (one year at full salary, tax free) is accounted for.
 
Additionally, expanding the classification of employees eligible for presumptions becomes incredibly challenging for employers to try and stabilize costs, ensure appropriate staffing and provide adequate services to the public. There is also a concern that this will lead to an increase in the prevalence of Industrial Disability Retirement (IDR’s) which are costly for public agencies.
 
Current Workers Compensation Expansion Bills Affecting Public Employers
 
Below are four measures that prove to be most problematic in the 2019 Legislative Session for public employers, ranked in order of greatest fiscal impact:
  1. AB 932 (Low) Off-Duty Firefighters: Out-of-State. Expands the scope of workers’ compensation to apply when a firefighter engages in a fire-suppression, rescue operation, the protection or preservation of life or property, outside of this state. Sponsor: CPF. 
  2. AB 1400 (Kamlager-Dove) Firefighting Operations. Civilian Employees. Provides all presumptions within the workers compensation system currently authorized for active duty firefighters to “all fire service personnel.” This will apply broadly to all non-sworn fire personnel. Sponsor: AFCME. 
  3. SB 542 (Stern) Post-Traumatic Stress Disorder. Creates a new presumption for post-traumatic stress disorder within the workers’ compensation system for police and fire personnel. Applies provisions retroactivity to Jan. 1, 2017. Sponsor: CPF. 
  4. SB 416 (Hueso) Expansion to All Peace Officers. Expands all presumptions in the workers’ compensation system currently approved for firefighters, sheriffs, police officers, California Highway Patrol officers, and arson investigation units to all employees designated as peace officers as defined in Chapter 4.5 of Title 3 of Part 2 of the Penal Code, except for those peace officers described in subdivision (b) of Section 830.1, subdivision (b) or (d) of Section 830.2, or Section 830.39, 830.4, or 830.5 of the Penal Code. Sponsor: PORAC. 
Governor Newsom vs. Governor Brown
 
In 2012, Gov. Jerry Brown spearheaded one of the largest workers’ compensation reform packages in recent memory. His action sent an incredibly strong message to the Legislature, the public and interest groups such as the attorneys and organized labor that he was unwilling to sign measures that would drive up employer cost without sufficient data to justify the expansion. We saw this in practice time and time again when Governor Brown consistently vetoed measures that sought to take away apportionment. As such, Governor Brown became a critical backstop for curbing costs in the workers’ compensation system.
 
Governor Newsom, to date, has not indicated where he will land on proposed workers’ compensation expansions. As early endorsers of his gubernatorial campaign, CPF anticipates Governor Newsom will be more receptive than Governor Brown.
 
Despite the potential of the measures listed above to drive up costs for public employers in the workers’ compensation system, the Legislature is likely to send Governor Newsom the majority, if not all, of these pieces of legislation. The critical question remains: will Governor Newsom continue to hold the line on cost driving measures in the system, or be more accommodating than his predecessor?
 
Recent Action and Next Steps
 
The League of California Cities in conjunction with the California Coalition on Workers Compensation, California State Association of Counties, California Special Districts Association and other statewide public and private organizations have joined together in opposing these measures. All the measures outlined above, however, have made it through their respective legislative houses. It is critical that cities work through the League to oppose these measures to increase the ability to either stop them in the Legislature or get on record so that Governor Newsom will more fully understand the potential financial impacts on public employers. As these measures continue through the legislative process, cities are encouraged to send letters of opposition to their legislator and a copy to cityletters@cacities.org. The full text of the measures can be found at www.cacities.org/billsearch by plugging the bill number into the search function.


 
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