California Court of Appeal Holds Workers’ Compensation Appeals Board has Jurisdiction to Award Penalties for Delayed Advance Disability Pension Payments Because the Payments are “Compensation”

The California Court of Appeal recently addressed whether the Workers’ Compensation Appeals Board could impose penalties for unreasonably delaying or denying advance disability pension payments to local peace opolice carfficers disabled on the job.  The jurisdictional question posed in this case was whether the Workers’ Compensation Appeals Board could impose penalties according to the Labor Code for an unreasonable delay in payment.

The plaintiff in this case worked as a deputy sheriff in Sacramento and suffered a job-related injury. She applied for industrial disability retirement and requested advance disability pension payments, available under Labor Code section 4850.4, during the period that her retirement application was processed. She did eventually receive these payments, but she sought penalties for an unreasonable delay, under Labor Code section 5814.

The Workers’ Compensation Judge found that section 5814 penalties were available for the delay in payment, but the Worker’s Compensation Appeal Board (WCAB) reversed the finding. The plaintiff petitioned for a writ of review.

The court of appeal stated that the purpose of California’s workers’ compensation law is to protect individuals from “special risks” of employment.  The law is set forth in the Labor Code, division 4, and public employees are covered by California’s workers’ compensation law.  However, some public employees in active law enforcement who are disabled at work are entitled to special benefits, instead of disability benefits.

The WCAB can impose penalties when compensation payment is denied or unreasonably delayed.  These penalties are imposed to help employees obtain the relief they are entitled to receive by law.

The court of appeal also discussed the differences in defining the term “compensation,” since it can mean remuneration for work done or indemnification for injuries.

Regarding whether applying penalties to delayed payments of benefits is contrary to the workers’ compensation statutes, the court stated the County did not stand for this proposition. The Labor Statute and section 5814 help injured employees. Applying section 5814 to advanced disability pension benefits would further this purpose.  Otherwise, disabled officers may not be capable of supporting themselves, until disability retirement payments begin.

The County’s position was that applying penalties to these benefits is not consistent with the statutory scheme.  Disability pension advances are not workers’ compensation benefits, nor are they provided in lieu of workers’ compensation benefits.  In other words, the County argued that the Workers’ Compensation Board should not be able to penalize employers for delaying payments.

The court turned to the Labor Code to determine how “compensation” is defined.  The appellate court stated that advance disability pension payments are compensation and set forth in division 4. Benefits under section 4850.4 serve the same purpose as workers’ compensation benefits.

The appellate court annulled the decision and remanded the matter to the WCAB.

At Sharifi Firm, our dedicated workers’ compensation attorneys help injured Southern California workers in their claims for compensation.  Our experienced team can guide clients through all facets of the process, including appealing an adverse decision.  Contact our office for a complimentary, confidential consultation by calling 866.422.7222.

More Blog Posts:

California Court of Appeal Annuls Writ of Review Because Workers’ Compensation Orders and Decisions Must be Final before Seeking Writ, November 25, 2016

California Court Holds State Workers’ Compensation System Provides Injured Employees Ample Opportunity for Review and Does Not Violate State Constitution, Southern California Injury Lawyer Blog, November 17, 2015

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