Originally Published on Bloomberg Law on September 1, 2023
A loophole that allowed an appeals board for California workers’ compensation claims to indefinitely stallcases without explaining why was closed in August, forcing the board to change the way it handlesbacklog in ways that may leave workers no better off.
The Aug. 1 ruling from the California Second District Court of Appeal said that the Workers’ CompensationAppeals Board can no longer use a rubber stamp to buy time on a case via “grant-for-study,” a way theboard had delayed ruling before the 60-day deadline required by law. Cases put under grant-for-study often languish for years.
The ruling addressed a long and bureaucratic process with high stakes for injured workers who were stuckin limbo while monthly bills pile up, adding stress to workers who sustain sometimes life-threatening injuries.
But the decision isn’t the big win anyone was hoping for, watered down by language in the ruling thatallows the board to still use the loophole if it describes in detail why it is warranted. And lawyers say its downstream impacts could ultimately move the board away from its worker-centered approach, given its financial constraints.
The decision could increase the number of cases remanded back to trial court for more evidence or couldcause the board to deny more cases outright, applicants’ attorney Jason Wells said.
Additionally, the board will need more funds to address cases that it no longer can automatically delay. Itmight get those funds by increasing assessments of insurance companies and self-insured employers,workers’ compensation defense attorney John Parente said.
Lawyers on both sides of the appeals process say the decision in Earley v. WCAB won’t help cases flow faster through the legal system—but it could cause workers’ compensation proceedings to seek alternatevenues to resolve their differences.
“They’ve been under the gun, and this forced their hand,” Parente said.
A ‘Black Hole’
For years, when he was Kern Valley State Prison’s Chief Psychiatrist, Asarulislam Syed, a client of applicantattorney Michael Bannon, sustained psychological injury.
According to court documents, his employer put him in situations that Syed felt pushed him to violatemedical professional standards: Syed was asked to report to two non-medical practitioners in succession,and he was then given a letter that required he “perform job duties inappropriate to a chief psychiatrist.”
A workers’ compensation judge found in late 2019 that Syed’s injury was due to his work.
However, when Syed’s employer appealed the decision to the Workers’ Compensation Appeals Board,saying in part that Syed “misperceived reality,” the seven-member appeals board granted it for study,sending his initial victory into question for an unknown amount of time.
His case dragged on for two and a half years after that, before the board ruled in Syed’s favor. Workers sometimes wait three years or more after their cases are moved to grant for study, Bannon said.
The use of grant-for-study in workers’ compensation cases nearly doubled around the onset of Covid-19,with the Board applying it to 40% of cases between 2020 and 2021, according to the Earley opinion. And ofcases granted for study between October 2018 and October 2021, 543 were awaiting a ruling in November 2021.
Stories from lawyers representing these clients include workers who are so sick with terminal conditionsthat they may not see benefits in their lifetime due to the grant-for-study delays.
“It has now been a year and a half since the Opinion and Order Granting Petition for Reconsideration wasserved on the parties,” a 2018 letter from applicants’ attorney Alan Gurvey to the Board said. “This matter involves a catastrophically injured worker, who is unable to work due to his work injuries and is need of home care. As for now, provision for all of his medical needs are not being provided and the family is concerned about his well-being.”
Bannon said one client lamented to him, “I swear they’re trying to drag this case out until I die.”
“Grant-for-study is, in no uncertain terms, a black hole,” applicants’ attorney Michael Bannon said.
No Rubber Stamp
Ultimately, Earley doesn’t mark the end of the grant-for-study loophole. That’s because, counter topetitioners’ wishes, the 2nd District said the board isn’t required to issue a final decision on a case before the 60-day deadline.
The board needs to explain specifically why each case was put under reconsideration instead of usingrubber stamp language when it grants cases for study, the 2nd District ruled.
Understanding the board’s rationale could give attorneys more grounds to appeal their cases, applicantsattorney Timothy Chan said. Chan’s firm, Michael Burgis & Associates, represented some plaintiffs in the Earley v. WCAB case.
The board claimed in Earley that issuing specific grant-for-study orders for each case was impossible. This claim could be read as a plea for more funding, which is beyond the Court of Appeals’ control, the opinion said.
Following the decision, the board said that it “is still assessing our next steps,” adding that it strives “to ensure that all injured workers receive the benefits they are entitled to and that will continue to be our focus.”
Should capacity issues continue, attorneys say the workers’ compensation legal system will be forced to act more like the civil litigation system. Remanding cases for further review and denying consideration outright isn’t common practice in workers’ compensation law. California code says such laws should be liberally construed in favor of the employee.
With uncertainty clouding the grant-for-study process, parties might line up for mediators to get settlements outside of court in larger numbers, Bannon said.
Meanwhile, delays will continue to harm the system, injured workers, and employers, Gurvey said.
“Earley kind of cut the baby in half,” Gurvey said. “It really isn’t a victory for anyone.”