Court Rules the WCAB Has Jurisdiction to Impose Penalties Against a Public Employer for Failure to Pay Advance Disability Pension Payments

The 1st District Court of Appeal decided in the case of Gage v. WCAB [Workers' Compensation Appeals Board], that the WCAB has jurisdiction to impose penalties on public employers for the unreasonable delay or denial of advance disability pension payments available under Labor Code Section (LC) 4850.4 to local safety members who are disabled on the job with a disability retirement pension application pending.

The enforcement of benefits under LC Section 4850.4 has long been an unclear issue for many local courts. It has been extremely difficult to convince local judges to enforce payment when an employer refused to provide it. This decision clarifies the court jurisdiction and allows penalties to be pursued when an employer refuses to provide timely payment of this needed benefit. Previously, when a member filed for industrial disability retirement or service connected disability retirement, there could be a loss of income while the employer or retirement board went through their process of granting or denying the application.  This ruling provides injured workers a powerful legal argument and remedy to force proper and timely payment of benefits.

The Court ruled this way because:

• Such payments qualify as compensation under LC Section 3207.
• Labor Code Section 5814 penalties are available for unreasonable delay or denial of the payment of compensation.
• No other provision of the LC proves a legislative intent to exclude such payments from the penalty provisions of LC Section 5814.

Rebecca Gage was a deputy sheriff in Sacramento County when she was injured on the job and applied for service connected disability retirement. In addition she requested advance disability pension payments while her retirement application was processed pursuant to the requirements of LC Section 4850.4. Although she eventually received the advance payments, she sought penalties, under L C Section 5814, for the county's unreasonable delay in providing the benefit.

The WCAB trial judge opined that the advance disability pension payments constitute "compensation" and are, therefore, subject to penalties under LC 5814 if unreasonably delayed. However, the defendant (the County of Sacramento) argued that disability pension payments are subject to the County Employee's Retirement Law of 1937 and, therefore, do not constitute "compensation" for Workers' Compensation purposes. In other words, if the payments are not considered "compensation," the penalties under LC 5814 don't apply.

"The Court of Appeal decision in this case is a fair and just one," says Adam Dombchik, a partner in the law firm of Gordon, Edelstein, Krepack, Grant, Felton & Goldstein, LLP (GEK). "According to LC 4850.4, any public retirement system must make advance disability pension payments while an employee's application is pending, if the applicant complies with all of the deadlines and requirements, which officer Gage did. It is imperative that those who put their lives on the line every day to ensure our safety receive the full range of benefits they're entitled to, and without delay."

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