While the legislature is in session, the National Federation of Independent Business/California will be profiling anti-small business bills and policy, and the adverse effect they would have on California’s job creators. This is the fifth column of that series.
Sadly, small businesses aren’t all that surprised these days when the California Legislature tries to erect yet another roadblock that will further block economic or job growth on Main Street in our state. But what small employers did not know or anticipate is that a little-known, quasi-judicial state board would give our elected leaders a run for their money by taking the greatest legislative achievement in the past half-decade – workers’ compensation reform – and completely rewriting legislation that has significantly benefited California employees and employers.
Recently, the NFIB Small Business Legal Center took on this grievous overreach by the Workers’ Compensation Appeals Board (WCAB) and filed amicus briefs in the reconsideration of two pivotal cases (Almaraz v. Enviroserve and Ogilvie v. San Francisco) that affect California workers’ compensation system. The cases challenge workers’ compensation reforms that brought objectivity to the evaluation of permanent disabilities and disability benefits.
The 2004 legislation, Senate Bill 899, established a fixed disability rating schedule based on American Medical Association guidelines. Use of this objective system eliminated the need for dueling expert witnesses and dramatically reduced litigation. As a result, California businesses have saved about $40 billion and workers’ compensation insurance rates have dropped by an average of 60 percent.
Facing significant public pressure for a decision that flies in the face of the Governor and Legislature’s intent, the WCAB quickly pulled back and agreed to reconsider their position, which they are expected to rule on shortly. One can only hope that they maintain the intent of SB 899 that reduced average costs for employers by 64 percent, increased the number of injured workers getting back on the job, and curtailed excessive use of medical service while preserving access to quality medical treatment.
There is no good time for the WCAB to make quasi-judicial activist decisions that fly in the face of reason, but our current economy demands that they act in accordance with the law as written. The board has a responsibility to small business and all California voters to reverse their earlier position and uphold the intent of the 2004 reforms.