Two pieces of legislation were introduced on February 15, 2024, to the Senate Committee on Labor, Public Employment and Retirement, which if passed could have a significant impact on the administration of Temporary Disability benefits in the Workers Compensation system.

The first bill is SB1205 which proposes the addition of new Labor Code section 4600.03. The addition of LC 4600.03 specifies that notwithstanding LC 4656, when treatment is provided pursuant to an employee who is working, an employee is entitled to receive all reasonable expenses of transportation, meals, and lodging incidental to receiving treatment, as well as, (and most significantly) one day of temporary disability indemnity for each day of wages lost receiving treatment. Section B provides that if an employee does not have to miss a full day of work, then the employer may pay a percentage of TD indemnity representative of the percentage of time lost receiving treatment. Section C, just as importantly, provides this section shall apply regardless of whether an injury is permanent stationary or not.

The second of the two bills is SB1346 which proposes an amended to LC 4656 which sets the cap on temporary disability indemnity at 104 weeks and 240 weeks within a five year period from the date of injury. The amendment to LC 4656 would add a section (e) which provides that if a denial of treatment requested by a primary treating physician is overturned by independent medical review, the WCAB has the discretion to award TD benefits notwithstanding the 104 week cap of section (e) and the 240 week cap set forth in section (d).

The direct implications of these senate bills are a major expansion of TD benefits that employers will be required to pay their employees for industrial injuries. The addition of LC 4600.03 would potentially cause a substantial increase in the amount of reimbursement already being paid to employees receiving treatment for industrial injuries. This would require reimbursement for treatment received while the employee has already returned to work and has been deemed permanent and stationary.

The introduction of SB1346 expanding LC 4656 makes this even more interesting, as it provides the WCAB with discretion to disregard the already existing caps of 104 and 240 weeks for TD indemnity. Assuming that section (e) is added, this would provide an interesting but niche scenario wherein IMR overturns a treatment denial and an employer would potentially be responsible for additional treatment beyond the 104 weeks, regardless of whether an employee has returned to work or not.

As everyone knows by now the expansion of TD benefits is always at issue, and while these senate bills have not been signed into law, they have the potential to substantially alter the way TD benefits need to be paid moving forward. I am intrigued to see if LC 4600.03 is added due to the ramifications of TD needing to be paid beyond the 104 weeks per 4656(c). LC 4656 getting expanded to include section (e) would, in my estimation, open the doorway to the need to pay benefits pursuant to LC 4600.03 beyond the 104 week cap.

I must reiterate, that these bills have not currently been signed into law, but need to be monitored for their far reaching implications. While, LC 4656’s expansion applies to a niche scenario on paper, it provides for judicial discretion to award additional benefits. If this bill passes, it would not be out of the realm of possibility that judicial discretion would expand this bill beyond the niche scenario it is written for. However, that is far from the current reality, and there is every possibility that this bill, along with SB1205, does not pass. At this time, it would be wise to monitor the progress of this bill, because it would unambiguously expand employee benefits beyond what they are currently.