Monday, September 1, 2008

Negotiating and Settling Liens

Announcing, the first class in our - Industry Education Series - A series of Educational Forums provided to the Workers' Compensation Industry


DATE: 3/19/2009

LOCATION: Scott's Jack London square

TIME: 8:30 am to 1:00 pm

Register now at

Spend $150 and save thousands!

Class includes: Legal perspective from Dave Schmit, Esq.; EDD Rep participation, Retired WCAB Judge and Hearing Rep perspective!

The Second Class of The Series will be announced shortly for May 2009.

"Preparing For A Utilization Review Audit"

1. Avoid penalties and fines
2. Improve your company Best Practices for UR
3. Receive a passing score on your audit
4. Save your company money

Thursday, January 24, 2008

Court Rejects "Honest Misperception" Standard

Court Rejects "Honest Misperception" Standard - Objective Evidence of Harassment Required for Injury

One of the unanswered questions that we have had since the revisions to Labor Code § 3208.3 in July of 1993 is exactly what impact the statutory changes had on the concepts outlined in the Alberson's v W.C.A.B. (Bradley) case that established a "subjective perception" standard for an injured worker's development of a psychiatric disorder related to employment. The Appeals Court in Albertsons' held that the test for whether an employers conduction resulted in as stress full work environment depended on the employee's perception of the events of work and that as long as the employee "honestly perceived" the employment situation as being stressful, the burden for proving injury had been met.

As part of the 1993 reforms, the legislature imposed a higher standard for proof in psychiatric cases, requiring "actual events" of employment to be predominate as to all causes. Subsequent cases have helped to define what is and is not a work related event (PG & C v W.C.A.B. (Barnes) held that dips in the employee's retirement plan due to stock fluctuations was not an event of employment). However viability of the "honest perception" standard has not been addressed in appellate law, until now.

In Verga v W.C.A.B. & United Airlines, the 3rd Appellate district has taken the issue head on and clearly indicated that the "honest perception" standard was intentionally abrogated by the legislature with the changes to Labor Code § 3208.3:

"Section 3208.3, subdivision (b)(1) "was intended to overrule [Albertson's]" (1 Hanna, Cal. Law of Employee Injuries and Workers' Compensation, supra, § 4.02[3][b], p. 4-22) by imposing "more stringent requirements for [psychological injuries] than the subjective standard set forth in Albertson's." (Save Mart Stores v. Workers' Comp. Appeals Bd. (1992) 3 Cal.App.4th 720, 724, fn. 3.)

Thus, for claims like those tendered in Albertson's and in this case, we agree with a leading treatise on workers' compensation law that the "actual events of employment" language added by section 3208.3, subdivision (b)(1) "can be interpreted" as requiring the employee to establish "objective evidence of harassment, persecution, or other basis for the alleged psychiatric injury." (1 Hanna, Cal. Law of Employee Injuries and Workers' Compensation, supra, § 4.02[3][b], p. 4-22.) That interpretation, which we adopt, is the one most consistent with the purpose of the statute, and is the interpretation applied by the WCAB in this case (citation omitted)"

In the Verga case, the W.C.A.B. determined that the employee's own actions in being hostile and inappropriate with co-employees was the actual cause of the applicants job stress, not the actions of the employees in the situation. The employer presented evidence from multiple employees all attesting that the applicant

"...was rude, inflexible and easily upset, and caused stress to co-workers, who at the staff meeting on January 14, 2000, advised Verga of their dissatisfaction with her behavior...

In sum, the evidence established that Verga had a very low frustration level and abused her co-workers when they did not meet her expectations. Although her co-workers reacted with disdain in their efforts to change Verga's behavior, their disdain was relatively benign. Verga was the aggressor, and she created the negative work atmosphere that she asserts caused her psychological injuries. Allen and Pena attempted to counsel Verga that her rudeness and inflexibility was counterproductive; but she chose to ignore their advice and continued to belittle her co-workers. She willfully demeaned her fellow employees.


The W.C.A.B. determined that the applicant's perception of the co-employee's reactions to her was not the predominate cause of the job stress but that it was her conduct, which resulted in the co employee's responses to her that provoked the stressful reaction in applicant.

The court noted that Workers' Compensation is intended to be a no-fault system, but also concluded that a no fault system did not require that stress which was caused by the IW own conduct be considered as arising out of the job setting. The court also rejected Verga's argument that regardless of the accuracy of applicant's perception of the events of employment:

"...they were actual events of employment that caused her stress and resulting psychological injury. In her view, the WCAB improperly introduced an element of fault into the no-fault workers' compensation system by finding that Verga cannot recover compensation because the workplace events that caused her psychological trauma were in response to her own bad behavior. "

As noted by the court, such an interpretation would again inject the honest perception standard into the definition of psychiatric injuries;

"Conceding that the law no longer allows workers' compensation for a claim of psychiatric injury based on the claimant's "honest misperception of the events of the workplace," Verga nonetheless argues the WCAB's finding that she was subject to the disdain of her co-workers is objective evidence of her psychiatric injury when considered together with medical evidence that the disdain caused her to suffer such injury. In her view, because workers' compensation is a no-fault system, it does not matter that it was her own conduct that instigated her coworkers' disdain.

However, the evidence does not support Verga's claim that her co-workers' "disdain" caused her psychiatric disability, let alone that it was the predominant cause of such injury. Dr. Segal's view of the cause of Verga's injury was based on her version of the abuse and persecution to which she allegedly was subjected by co-workers. But the WCAB found that such abuse and persecution did not occur. In Dr. Duncan's view, the predominant cause of Verga's psychiatric injury was her own behavior, as well as legitimate personnel actions. Neither doctor opined that the predominant cause of Verga's injury was the mere disdain of her co-workers.

Verga's position that she should get workers' compensation for work-related stress because she perceived her fellow employees' disdain as unusually stressful and persecutory events, although they objectively were not, resurrects the subjective standard of Albertson's, supra, 131 Cal.App.3d 308. This is contrary to the Legislature's intent in enacting section 3208.3, subdivision (b)(1). "

This case provides another tool for employer's to defend psychiatric claims where the actual disorder arises out of the employee's perception of valid employment related conditions especially where the employee is the one cause the hostility within the workplace. Obviously presenting such cases will require very fact intensive records to be developed with arguments bordering on allegations of fault on both sides. However the court's description of the legal standards to be applied is relatively clear as its rejection of the Albertson's "honest misperception" standard as a basis for injury.

This case is an important step in understanding the nature of psychiatric injuries in California Workers' compensation law. A copy of the case is attached to this message and a link to the appellate case in available by clicking on the case name above.

Friday, January 11, 2008


WorkCompTV.Com is proud to announce that we will premiere our "live blogging" service at the February 21, 2008 seminar on "Preparing For A UR Audit".

Live blogging will allow you to get real time updates and opinions on the seminar as it happens!


Announcing, the first class in our - Employer Education Series - A series of Educational Forums provided in conjunction with Kammerer & Associates

NEXT CLASS - "Preparing For A Utilization Review Audit"

1. Avoid penalties and fines
2. Improve your company Best Practices for UR
3. Receive a passing score on your audit
4. Save your company money

DATE: 2/21/2008

LOCATION: Scott's Walnut Creek

TIME: 8:30 am to 1:00 pm

Register now at

Spend $300 and save thousands!

The Second Class of The Series will be announced shortly for April 2008.