On March 10, 2021, Senator David Cortese (D-Santa Clara) amended his Senate Draft 335 regarding penalties for employee compensation payments. The bill had not previously made significant changes to Section 5814. This bill would amend sections 3212.86, 3212.87, 3212.88, 3761 and 5402 and add section 5814.3 to the Labor Code.
Section 1 of the bill would amend Section 3212.86 of the Labor Code to make technical changes. This section deals with employees with a COVID-19-related illness. Section 2 of the bill would amend Section 3212.87 of the Labor Code to make technical changes. This section deals with fire fighters. Section 3 of the bill would amend Section 3212.88 of the Labor Code to make technical changes. This section deals with employees not described elsewhere who will test positive during an outbreak in a workplace.
Section 4 of the bill would amend Section 3761 of the Labor Code to make technical changes. This section deals with an insurer protecting an employer’s liability. Section 5 of the bill would amend Section 5402 of the Labor Code to make several changes to that section, which deals with employer’s liability for compensation claims, including:
- Halve the number of days from 90 days to 45 days if liability is not refused after the date of filing the application form. The violation is considered to be liable to compensation under the law. The presumption can only be rebutted by evidence discovered after the 45-day period has expired (reduced from the current law of 90 days).
- Add a new subdivision that, regardless of the previous clause, applies to specific injuries or illnesses (including those related to hernias, heart conditions, pneumonia, or tuberculosis) that were sustained during the employment of a specific law enforcement officer or specific first person responder), if liability is not denied within 30 days from the date of filing the application form, the breach will be considered indemnifiable. The presumption would only be rebuttable by evidence discovered after the 30-day period had expired.
- Increase the medical treatment liability limit from $ 10,000 to $ 17,000 from one business day after an employee submits a claim form to the date the alleged infringement claim is accepted or denied.
Section 6 of the bill would add Section 5814.3 of the Labor Code to provide:
Notwithstanding the Labor Code, Section 5814 (which deals with the improper delay or refusal to pay compensation) if payment of compensation was inappropriately delayed or refused before or after the award of an arbitration award for claims for injury or illness in certain sections (including Hernia, heart disease, pneumonia or tuberculosis, etc.) would increase the total amount of the order, decision or award by 10 percent.
However, multiple increases would not be granted for repeated delays in the execution of a series of payments due for the same type or type of service, unless a legally significant event occurred between the delay and the subsequent delay in payments of the same type or type the service that gives rise to the liability of the employer or insurance carrier.
In addition, the issue of the delay and the adequacy of the cause would be determined by the Board of Appeal for Workers’ Compensation in accordance with the facts. This delay or rejection would be an important reason to set aside, change or add to the order, decision or arbitration award in order to effect the increase provided for in this section. Ultimately, this section would apply to all injuries regardless of whether the injury occurred before, on, or after the date of surgery of this section.
This bill is expected to be negotiated in its first political committee in April.
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