Rules ask state benefit increase for workers injured permanently

Californians permanently injured at work would receive more money for their disabilities under rules proposed Friday by the state board that sets formulas for workers' compensation benefits.

Although the proposal by the Division of Workers' Compensation would increase payouts an average of 16 percent, reaction ranged from cautious to derisive from critics who say the current permanent disability formula pays too little.

"It's a joke," said Mark Vickness, a workers' compensation attorney and head of the Russo Law Firm in Oakland. "It's an inadequate adjustment that means nothing."

Division Director Carrie Nevans in a news release on Friday said that the new schedule is based on "empirical data that ties wage loss to injury type. We've been studying how these two factors intersect … and now have enough data and analysis to support this increase."

Jerry Azevedo, a spokesman for the Workers' Compensation Action Network, a Sacramento-based coalition of state employers and insurers, said the group was going to need time to evaluate the planned rules.

Friday's proposal boosts the figures used to project how much a permanently disabled worker might have earned if he or she hadn't been injured. The so-called "multiplier" is key to figuring out fair compensation for an on-the-job injury that keeps an injured worker from making a living.

The new formula would also change how age figures into permanent disability payouts.

Currently, injured workers 37 and younger generally get less money for permanent disabilities. Those over 41 get more. The new plan would get rid of the disparity and would boost benefits for workers under 21 and over 52.

Senate President Pro Tem Don Perata, D-Oakland, is behind Senate Bill 1717, which is aimed at partially restoring the permanent disability payments that dropped drastically after a sweeping 2004 overhaul of the system backed by Gov. Arnold Schwarzenegger.

"We're pleased to see that there was an update," said Perata spokeswoman Lynda Gledhill, but we're still studying the information to see what exactly it would mean for workers."

The workers' compensation overhauls in 2004 cut employers' insurance premiums to less than $3 per $100 in payroll last year, down from $6.47 per $100 in 2003.

Injured workers and groups representing injury attorneys say that the cheaper rates have come at the expense of benefits, now far below those of other states.

For example, a report by the U.S. Chamber of Commerce notes that a California worker who lost an eye on the job would receive an average of $17,714. The same injury in New York would be worth $64,000; in Illinois, $168,318.

The new state compensation proposal would boost the average paid for a permanent shoulder injury to $8,153 from $7,693 if the workers' compensation division adopts the new rules for 2009. A hip injury would be worth $15,755 vs. $14,490; an ankle, $7,521 compared with $6,003.

Not good enough, said Sue Borg, president of the California Applicants Attorneys Association, which represents injured workers.

"I thinks it's appalling, really," Borg said. "This is certainly nothing that could be considered a fix."

The proposal announced Friday now moves into several rounds of public comment and revision before state officials can adopt it. The process could take as little as three months, said state spokesman Jeffrey Vistro, although it will likely take more time because of the complexity of the issue and the level of comment the Division of Workers' Compensation expects.

"It doesn't always go like clockwork," Vistro said.

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