On Tuesday, Gov. Jerry Brown (D) signed into law legislation (SB 863) that overhauls the state's workers' compensation system, the Sacramento Bee's "Capitol Alert" reports (Walters, "Capitol Alert," Sacramento Bee, 9/18).
Details of Bill
The legislation -- by Sens. Kevin de León (D-Los Angeles) and Jose Solorio (D-Anaheim) -- changes the formula used to calculate benefits for injured workers, increasing their compensation by an average of 29%.
It also eliminates benefits for certain health conditions that often are subject to lawsuits, such as psychiatric problems, sexual dysfunction and sleep loss.
The State Compensation Insurance Fund said employers likely will pay less for workers' compensation insurance under the law.
According to de León, any savings generated by the law will help raise benefits for permanently disabled workers (California Healthline, 8/29).
Supporters of the bill -- including business representatives and labor leaders -- said it will save businesses $1 billion next year by making the system more efficient and limiting litigation.
Opponents of the bill -- including some chiropractors and attorneys for injured workers -- said that limiting litigation would result in fewer benefits for individuals who are unable to return to work (Watson/Lin, AP/U-T San Diego, 9/18).
Brown's Comments on New Law
In a statement, Brown said, "These significant reforms save hundreds of millions of dollars for California's employers while preventing an imminent crisis of skyrocketing rates that would have hurt both injured workers and businesses." He added, "It's extraordinary to see Republicans and Democrats come together to solve a problem before it becomes a crisis" ("Capitol Alert," Sacramento Bee, 9/18).
Other Comments on New Law
California Assembly Speaker John Pérez (D-Los Angeles) said that the signing of the bill "represents a major victory for working people and employers alike in California."
Senate President Pro Tempore Darrell Steinberg (D-Sacramento) said that the law is "a big deal because it dramatically improves the plight of injured workers, while at the same time it ensures cost stability for California's employers" (Castellanos, Los Angeles Times, 9/19).
However, Brad Chalk -- president of the California Applicants' Attorneys Association -- said that the law "restricts the ability of an injured worker to access necessary medical treatment and to receive adequate compensation if a worker is permanently disabled and cannot return to work at the same salary."
Kassie Donoghue -- a chiropractor and director of government affairs for the California Chiropractic Association -- said that some of the law's reforms do not make sense because many cost increases in the workers' compensation system are driven by prescription drugs and medical treatments (AP/U-T San Diego, 9/18).