California lawmakers have begun instituting some workers’ compensation reform in the form of SB 863. This law has been widely hailed as a “new and improved” workers’ compensation reform package, and includes many changes to the way injured employees are compensated when they cannot return to work in their original role.
Workers’ compensation reform in California: Supplemental job displacement benefit vouchers
“The supplemental job displacement benefit voucher system was put in place to assist employees who were deemed unable to return to work and given permanent restrictions which could not be accommodated by their employers.” Cathy Divodi explained in a recent CER webinar. This assistance is meant to help pay for job retraining during the time of transition for that employee.
Under the old system, injured workers could be offered vouchers with an amount based on a sliding scale ranging from $4,000 to $10,000 in increments of $2,000. The amount of the voucher was based on the injured worker’s permanent disability rating. As such, it was not required for employers or workers’ compensation carriers to offer that voucher until the permanent disability rating was determined, which was often at the point of award or settlement agreement.
“Now, as a result of SB 863, the voucher amount is now fixed – regardless of the permanent disability [rating] – at the $6,000 for employees who are determined [to be] unable to return to their usual and customary work and where the employer is not able to accommodate the employee in a permanent modified capacity.” Divodi explained. The claims carrier or employer has 60 days to give the voucher to the employee. This is 60 days from the date of receipt of the report from the evaluating physician (stating that the injured worker is permanently restricted).
The employee has 2 years from date of issuance of the voucher or 5 years from the date of injury to use it, or it expires.
Within that $6,000 figure, there are sub categories of eligible expenses the voucher can be used for:
- Up to 10 percent ($600) can be used for return-to-work services (i.e. job placement).
- Up to $1,000 for a computer.
- Up to $500 for miscellaneous expenses, which don’t need to be itemized or accounted for. This $500 can be advanced to the employee.
This list represents an expansion of the types of expenses the voucher can be used for. It should provide an incentive for injured workers to use the vouchers. Additionally, the ability to use $500 without providing proof of use (or any other type of accounting of the funds) is a change from before. This should increase the number of people using it.
This article outlines just one of the many changes SB 863 is bringing to California’s workers’ compensation system. It is one step of many on the road to a fairer system.
The above information is excerpted from the webinar “Workers’ Comp Reforms: How S.B. 863 Will Affect Your Workplace; Get Prepared Now.” To register for a future webinar, visit CER webinars.
Cathy Divodi is the owner of Artemis Claims Consulting and has over 20 years in workers’ compensation claims management. She is a workers’ compensation hearing representative and has a wide range of specialties including: expertise for insured and self-insured employers, reviewing claim reserves and analyzing losses, conducting claim audits, training on reporting of claims, early return-to-work programs, abuse/fraud and first-aid programs, expertise in workers’ compensation litigation and more.