Incomplete claim file doesn't justify benefits at more than maximum rate

In California, a worker is not entitled to receive TTD benefits at a rate higher than two-thirds of the worker's average weekly earnings, even if the claim adjuster failed to maintain documentation sufficient to determine the worker's average weekly earnings.

Case name: Coca-Cola Enterprises, Inc., et al. v. Workers' Compensation Appeals Board, No. A131011 (Cal. Ct. App. 04/25/11).

Ruling: The California Court of Appeal held that an employer had to pay penalties for an underpayment of temporary total disability benefits.

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What it means: In California, a worker is not entitled to receive TTD benefits at a rate higher than two-thirds of the worker's average weekly earnings, even if the claim adjuster failed to maintain documentation sufficient to determine the worker's average weekly earnings.

Summary: A worker sustained a work-related injury to his shoulders. He received TTD benefits during two periods. During the second period, the employer provided the claim adjuster with a wage statement summarizing the worker's earnings. The worker was later paid a lump sum retroactively adjusting his benefit level for both periods to his weekly income. The worker sought a penalty to be imposed on the employer for an underpayment of benefits. The California Court of Appeal imposed penalties on the employer.

The court found the workers' compensation judge incorrectly calculated the penalties. The court said that the worker was entitled to TTD benefits at the rate of two-thirds of his income. During the first period, his benefits were capped. During the second period, the maximum exceeded two-thirds of his income, so payments should have been made at that amount. The court said that if an adjuster breaches its duty to maintain documents in its claim file to determine a worker's average weekly earnings, an injured worker is not entitled to the maximum statutory rate or a rate higher than the maximum regardless of his actual earnings. The court stated that penalties automatically apply if a claims adjuster fails to make appropriate payments because of insufficient documentation in the claim file.

Read more at the WorkersComp Forum homepage.

June 27, 2011

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