Under Labor Code section 4453, subdivision (a)(10) temporary disability rate is increased annually by the  percentage increase in the state average weekly wage (SAWW) as compared to the prior year.  The SAWW is defined as the average weekly wage paid to employees covered by unemployment insurance as reported by the U.S. Department of Labor for California for the 12 months ending March 31 in the year preceding the injury.  In the 12 months ending March 31, 2010 the SAWW declined from $984.83 to $979.90, a decline of .5%.

For 2010 the minimum TD rate was $148.00 and the maximum TD rate was $986.69.

The California Department of Workers' Compensation (DWC) has interpreted section 4453 to be a one-way door.  It is reporting the rates will remain unchanged for 2011 dates of injury.  However, the statute is silent on the effect of a drop in the SAWW.  The effect of the DWC's interpretation will result in a windfall to injured workers once the SAWW starts to increase again.

For example:  If, next year the SAWW returns to its 2009 level ($984.83) the "percentage increase" will be .5%.  The same .5% it decreased last year.  There would be no net change to the SAWW over the 2 year period.  However, the 1 year change in the SAWW would be .5%.  This would result in the TD rate increasing .5% over the 2 year period despite no change in the SAWW.  If the decline in the SAWW continues the effect when the trend changes will be even more drastic.

It is clear that the drafters of section 4553 never contemplated such a scenario.  It remains to be seen whether any defendant will challenge the DWC's interpretation of the adjustment provision by unilaterally adjusting the TD rates paid to reflect the decrease in the SAWW.

Labor Code section 4659(c) also requires adjustment of life pension and permanent total disability rates for workers with dates of injury on or after January 1, 2003.  The DWC is again stating the rates remain unchanged.

Posted November 1, 2010.

To learn more about how we can help you with your case, please contact us today!

Message

Heggeness, Sweet, Simington & Patrico, A P.C.
.........................................
Locations:

San Diego
7071 Convoy Court
Suite 200
San Diego, CA
92111-1023
Phone (858) 874-2100

Riverside
6180 Quail Valley Court
Suite 110
Riverside, CA
92507-0757
Phone (951) 656-1944

Santa Ana
600 West Santa Ana Boulevard
Suite 700
Santa Ana, CA
92701-4555
Phone (714) 550-1133

Bay Area
1633 Bayshore Highway
Suite 360
Burlingame, CA
94010-1537
Phone (650) 350-1908

Salinas
748 Northridge Center, #348
Salinas, CA
93906
Phone (831) 320-9941