As autumn ushers in cooler weather and the start of a new school year, it also brings unique legal considerations. With changes in policy, procedure and the law, we hope to keep you informed of all updates in the workers’ compensation system to assist you in navigating claims effectively and ensuring compliance in the workplace.
WCAB MUST ACT ON PETITIONS FOR RECONSIDERATION WITHIN 60 DAYS
In Mayor v. WCAB, the 1st District Court of Appeal held that if the Workers’ Compensation Appeals Board (WCAB) does not act on a petition for reconsideration within 60 days from the date of filing the petition, the WCAB loses jurisdiction, and the petition is denied by operation of law.
For cases after 7/2/2024, amended LC 5909 applies. The 60 days for the WCAB to act on a petition for reconsideration starts when the judge serves the decision along with the report and recommendation on reconsideration on all parties and the WCAB, not with the filing of the petition.
This means that practitioners should be prepared to file a writ with the Court of Appeal if the WCAB does not act on a petition for reconsideration after 60 days.
For over 30 years, the WCAB relied on Shipley v. WCAB (1992) 7 Cal. App. 4th 1104, to act on petitions for reconsideration, after the 60-day time-period required by former Labor Code (LC) Section 5909. LC Section 5909 previously stated that “[a] petition for reconsideration is deemed to have been denied by the appeals board unless it is acted upon within 60 days from the date of filing.” Relying on the Shipley decision, the WCAB generally maintained that if a petition was not addressed within the 60-day period due to the board’s inadvertent error, it could still rule on the petition, even after the 60-day deadline had passed.
In Zurich American Insurance Co. v. WCAB (2023) 97 Cal. App. 5th 1213, the 2nd District Court of Appeal held that the WCAB’s longstanding practice was improper. The court found that “the language and purpose of section 5909 show a clear legislative intent to terminate the Board’s jurisdiction to consider a petition for reconsideration after the 60 days have passed, and thus, decisions on the petition made after that date are void as in excess of the agency’s jurisdiction.” The Zurich court interpreted Shipley as creating a narrow exception to the 60-day requirement in LC 5909 only when two conditions are met: (1) the petitioner acted diligently to protect their rights, and (2) the WCAB misled the petitioner in a way that deprived them of their right to review by the WCAB or the appellate courts.
Effective July 2, 2024, Assembly Bill 171 (AB 171) amended Labor Code § 5909. Subsection (a) now states, “[a] petition for reconsideration is deemed to have been denied by the appeals board unless it is acted upon within 60 days from the date a trial judge transmits a case to the appeals board.” Subsection (b) requires that the trial judge notify the parties and the WCAB when transmitting a case to the board, and it clarifies that a report and recommendation under LC 5900(b) constitutes such notice. Lastly, subsection (c) specifies that the amended statute will remain in effect until July 1, 2026, after which it will revert to its previous language.
In Mayor, the 1st District Court of Appeal agreed with the Zurich court’s reasoning, holding that under the former Labor Code § 5909, the WCAB lost jurisdiction to act on a petition for reconsideration once the 60-day deadline passed. The court noted that the amendment to LC 5909 by AB 171 implicitly affirmed Zurich’s interpretation of the previous statute and alleviated the WCAB’s concerns about the future implications of that interpretation.
After trial, the workers’ compensation judge (WCJ) in Mayor issued an Award in applicant’s favor on March 2, 2023. The defendant filed a petition for reconsideration on March 23, 2023. Defendant subsequently wrote to the WCAB about the status of the petition after the expiration of the 60-day period. On August 14, 2023, the WCAB issued an order granting reconsideration, stating that it had first received notice of the petition on June 15, 2023. The WCAB issued its decision after reconsideration on January 26, 2024, and then rescinded that decision on February 2, 2024, replacing it with a revised version that sent the matter back to the trial level for further proceedings. According to the revised order, “due to an administrative irregularity” that was neither parties’ fault, the WCAB did not receive defendant’s petition for reconsideration until more than 60 days after the petition for reconsideration was filed. Meanwhile, the applicant filed a petition for writ of mandate, arguing that the WCAB lost jurisdiction over the case 60 days after the defendant filed its petition for reconsideration.
The 1st District Court of Appeal reiterated that former Labor Code § 5909 was mandatory and that the WCAB had no jurisdiction to grant defendant’s petition after the 60-day deadline expired. The court noted that Zurich rejected the WCAB’s argument that Shipley permitted extending the 60-day deadline whenever administrative errors occurred. The court clarified that Zurich effectively limited Shipley to its specific facts, allowing equitable tolling only when the WCAB misled a diligent petitioner, causing them to miss the deadline for judicial review.
The court said that AB 171 effectively ratified Zurich’s interpretation of the relevant statutes, noting that AB 171 was enacted about six months after the Zurich decision, which suggests that the Legislature intended to respond to Zurich. Notably, the Legislature did not attempt to clarify that the former LC 5909 was not mandatory or that Zurich had misinterpreted the statute’s intent. Instead, it changed the start of the 60-day deadline to begin with the WCJ’s transmission of the case file to the WCAB. The court concluded that this change implied tacit approval of Zurich’s interpretation of the former LC 5909 as mandatory, reasoning that if the WCAB’s previous practice were permissible, there would have been no need to alter the deadline.
The court said that AB 171 addressed the WCAB’s concerns about the future implications of the Zurich decision. By making the amendment to LC 5909 temporary, the Legislature provided a short-term solution to the WCAB’s resource constraints in meeting the former LC 5909 deadline. The said, “[f]or future cases, the new deadline trigger grants the Board additional time to handle petitions and resolve typical human errors or administrative issues.”
The court dismissed the WCAB’s argument that parties had a due process right to review by the WCAB, noting that “… opposing parties need not subordinate their rights to prompt resolution of disputes to accommodate open-ended delays that the Board claims are necessary for it to rule on petitions for reconsideration.” Additionally, the court rejected the WCAB’s claim that Zurich’s interpretation was “draconian” or “drastic” because it had relied on Shipley for more than 30 years to toll the 60-day deadline. In closing, the court said that “[a] long-standing but incorrect procedure remains incorrect.”
Given this, the appellate court issued a peremptory writ of mandate directing the WCAB to rescind its order granting defendant’s petitions for reconsideration and opinions and decisions after reconsideration and declared the WCJ’s award as final.
PRACTICE TIP: WCAB silence is not golden. Do not wait for a decision from the WCAB beyond 60 days after the WCJ transmits a case to the WCAB. Practitioners should be prepared to file a writ if the WCAB does not act on a petition for reconsideration after 60 days or risk losing their appellate rights.
DWC POSTS CALIFORNIA MEDICAL-LEGAL QUALITY CHECKLIST
On July 31, 2024, the State of California Department of Industrial Relations (DIR) Workers’ Compensation Division (DWC) announced that it posted a checklist designed to assist medical legal practitioners (AMEs, QMEs, IMEs and PTPs) to produce consistent and accurate medical-legal reports. In its announcement, the DIR notes that the production of accurate reports facilitates timely and appropriate benefits to injured workers.
The checklist covers practical advice on all aspects of report preparation and includes definitions for key terms and concepts.
The California Medical-Legal Quality Assurance Checklist is a resource for physicians to improve their report-writing but is not a mandatory format or template.
This Bulletin was written by Steve Rosendin, Associate Partner in our San Francisco office. A copy of this Bulletin and the most current twelve months are available on our website at www.mulfil.com/bulletins.
