Rate Of T. D. May Have Changed With 1989 Law

A Court of Appeal case has determined how the reform legislation of 1989 may have changed how temporary disability is paid. The case deals with Labor Code section 4453, subdivision (d).

The applicant was a full lime employee when she sustained an admitted injury.  The applicant was receiving temporary disability when a wage increase went into effect at her place of employment. The applicant believed her temporary disability rate should be increased, relying on Thrifty Drug Stores Inc. V. WCAB. The defendant argued that the legislation that added section 4453, subdivision (d) in 1989 replaced the “Thrifty Drug rule”. The Court of Appeal rejected both panics positions.

“The 1989 statutory changes did not alter the law as to pre-1990 injuries and cases interpreting that law remain valid for those injuries. As to injuries sustained on or after January 1, 1990, however, the Act changed section 4453.” The Court specifically referred to the third sentence of section 4453, subdivision (d). It concluded that benefits must remain in effect for the duration of the disability. They indicated that this requirement is inconsistent with the Thrifty Drug case. “Moreover, because benefits should be calculated with reference to the date of injury, wage increases or decreases that are not scheduled or reasonably anticipated at the time of injury should not be used to calculate temporary disability benefits for injuries sustained on or after January 1, 1990….However, insofar as Thrift}’ Drag holds that wage increases or decreases reasonably anticipated at the time of injury may be taken into account to calculate average weekly earnings under the earning capacity of section 4453, subdivision ©(4), it remains valid as to all injured workers regardless of the date of their injury.”

The Court indicated that when a dispute arises between the employee and the employer as to the proper T.D. rate the Appeals Board must make a two step analysis. The Board is first supposed to determine the normal duration of the disability. Second, the Board has to look at factors existing at the time of the injury to see if a wage increase could reasonably be anticipated at that time. “ Where there is specific demonstrable evidence that such factors exist which would have affected an injured worker’s earning capacity other than in a de minimis manner, the Board should consider these factors to calculate one sum that represents a fair and reasonable estimate of the average weekly earning capacity for the anticipated duration of the disability.” This rate will remain constant unless changed pursuant to Labor Code section 4661.5.

The main tiling to be determined is whether a salary increase was scheduled at the time of injury.

Case: Grossmont Hospital V. W.C.A.B.

Harvey Brown
3501 Jamboree Rd. Suite 602
Newport Beach, CA 92660

Newsletter Sign up

Workers Compensation Feed

Recent Newsletters