There are two schedules for rating permanent disability (PD) in California workers’ compensation cases. The “old” schedule adopted in 1997 is generally considered to be more generous in assigning levels of disability. In accordance with the 2004 SB 899 legislative reform, the state has established a “new” PD rating schedule effective January 1, 2005. There was considerable dispute as to when the new rating schedule applies.

It is undisputed that the new schedule applies to all injuries occurring on or after January 1, 2005, and it will also apply to those unresolved claims with injury dates before January 1, 2005, unless prior to that date: (1) there existed a comprehensive medical-legal report indicating that PD exists; (2) or there existed a medical report from the treater indicating that PD exists; or (3) the employer was required to provide notice to the worker under Labor Code §4061. Aldi v. Republic Indemnity Co. (WCAB en banc) 71 CCC 783 and Vera v. WCAB (2007) 35 CWCR 233.

The courts have made it clear that the duty to send notice under §4061 arises when the last payment TD benefits is made, not when those benefits commence. Baglione v. AIG (En banc) 72 CCC 444 and Pendergrass v. SCIF (En banc) 72 CCC 456. It does not seem to matter whether the notice was actually sent or not, only when it was required to be sent.

The courts have also clarified that a treating physician’s medical report or note issued prior to January 1, 2005 must in fact state that PD existed before 2005. Costco Wholesale Corp. v. WCAB (Chavez) (2007) 151 Cal. App. 4th 1101, 72 CCC 582. A report that merely contains a conclusion that PD will likely result, without reasoning, is not enough give rise to the old schedule. SCIF v. WCAB (Echeverria) 146 Cal.App. 4th 1311, 72 CCC 33. The mere mention of a condition that could result in PD is insufficient. Trader Joe’s Co. v. WCAB (Evets)(2007) 72 CCC 204. Also, the date that the report issues, rather than the earlier examination date, seems to be controlling. Biller v. WCAB (2006) 71 CCC 513.

The principal remaining controversy involves whether the report in existence prior to 2005 indicating that PD exists, also has to find that the applicant was permanent and stationary (P&S) at that time. Some courts have held that a report must actually indicate the existence of permanent disability at the time of the pre-2005 evaluation, not “at some time” in the future, in order for a pre-2005 injury claim to be rated under the old schedule. The courts have held that the pre-2005 report must not only find factors of PD, but must also indicate that the worker’s condition is at the time of the exam permanent and stationary (P&S) . Zenith Ins. Co. V. WCAB (Azizi) 153 Cal.App.4th 461, 72 CCC 785 and Vera v. WCAB (2007) 35 CWCR 233.

On the other hand, other courts have rejected this P&S requirement, and have held that the statute does not require that the worker’s condition be declared P&S before 2005. They reason that P&S is not necessarily synonymous with PD, and that therefore a P&S finding in the pre-2005 report is not required to trigger application of the old schedule. Genlyte Group, LLC v. WCAB (Zavala) 36 CWCR 1.

This conflict in the courts may have to be resolved by the state Supreme Court, or else through clarifying legislation. If doubt exists as to which schedule applies, ask physician to address permanent disability using both the old and new schedules.

To contact Tom Richard please visit Mr. Richard is the supervising partner of the firm’s employment law and occupational injury practice. He lectures frequently on current legal topics and has served as an expert witness, pro tem judge and instructor at the Insurance Educational Association (IEA). He is a certified specialist, State Bar of California Board of Legal Specialization, since 1999.