05/03/2007
Court agrees with NFIB's Legal Foundation, upholds state's fair workers' comp formula
CONTACT: Melissa Sharp, (202) 314-2068
Washington, D.C.--California small-business owners breathed a sigh of relief Thursday after hearing the state's Supreme Court decision to stick with the traditional method of determining an employers' workers' compensation liability.
The case decided today dealt with the formula by which California determines apportionment. Apportionment occurs when an employee with a preexisting disability is injured on the job, and is the process of determining the amount of workers' compensation the current employer owes, in spite of the prior injury. The California courts have for years followed a formula that fairly determines the employer's share; however, recent decisions by some lower courts created a new method that would have escalated awards and insurance premiums due to the progressive structure of the workers' compensation permanent disability schedule.
The National Federation of Independent Business Legal Foundation filed an amicus brief in this case urging the court to reject this new, unfair method.
"Workers' compensation costs are the third most problematic issue for small business according to an NFIB Research Foundation poll," said Karen Harned, executive director of NFIB's Legal Foundation. "The traditional method of apportionment, upheld today by the California Supreme Court, ensures that employers are only held responsible for the amount of disability caused by the current injury in question. This is a fair and reasonable method that will help California's small-business owners manage rising workers' compensation costs."
The case at issue is Welcher v. Workers' Compensation Appeals Board et al.
