Gino DiCaro

Again, Perata proposes to increase permanent disability benefits

By Gino DiCaro, VP, Communications

Capitol Update, April 18, 2008 Share this on FacebookTweet thisEmail this to a friend

Once again several labor and injured worker advocate groups are pushing legislation that will increase costs to California’s workers’ compensation system.  Senator Don Perata (D-Oakland) has amended SB 1717 to increase the Permanent Disability (PD) benefits in California by 2011.  Specifically, this bill doubles the number of weeks that an injured worker collects benefits for each percentage point of disability.

Current law directs the Administrative Director, (AD) for the Division of Worker’s Compensation (DWC) to develop PD regulations and adjust rates as necessary.  DWC has always based these adjustments on sufficiently gathered data.  They are, in fact, currently evaluating the need for a PD adjustment.

Yet, the proponents of SB 1717 continue to argue that there has been a dramatic decrease in the indemnity payments which is now hurting injured workers.  SB 1717 attempts to preempt any adjustments that might be made by the AD.  CMTA is strongly opposed to this legislation because it would drive costs immediately higher and undermine the positive effects of recent reforms.

Prior to the reforms, California businesses were facing extraordinary costs, PD claims were filed at a rate three times the national average with California’s rates being 20 percent higher than the next highest state.  

It is essential that California businesses continue to stay actively involved to protect the reforms that were put in place with the passage of Governor Schwarzenegger’s legislation, SB 899, in 2004.  CMTA encourages those that have seen a positive impact with the reforms to contact their legislators with their stories.  Legislators need to know how the savings have been reinvested in the workforce, such as with higher salaries or additional benefits.  

SB 1717 has not yet been assigned to a committee but is likely to be heard in the Senate Labor and Industrial Relations Committee and then later in the Senate Appropriations Committee.

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