CLARENCE A. PEBWORTH, Applicant,
v.
ALLAN HANCOCK COLLEGE, Permissibly Self-Insured; and WORKERS’ COMPENSATION ADMINISTRATORS (Third Party Administrators), Defendant(s).
No. GRO 0023699
California Workers Compensation Decisions
Workers Compensation Appeals Board State Of California
August 8, 2003
OPINION AND DECISION AFTER RECONSIDERATION (EN
BANC)
MERLE
C. RABINE, CHAIRMAN.
On July
2, 2003, the Appeals Board granted reconsideration of the
Finding of Fact and Order issued by the workers'
compensation administrative law judge ("WCJ") on
May 6, 2003. In that decision, the WCJ held in substance
that, although Labor Code section 4646 has been amended to
permit a defendant and a represented employee to settle
prospective vocational rehabilitation services under certain
circumstances, this amendment applies only to injuries
sustained on or after the January 1, 2003 effective date of
the amendments.
1 Therefore, the WCJ affirmed a
Determination of the Rehabilitation Unit, which had
disapproved of the parties' proposed settlement of
prospective vocational rehabilitation services on the basis
that the applicant's date of injury occurred before
January 1, 2003.
In
their respective petitions for reconsideration, applicant,
Clarence A. Pebworth ("applicant"), and defendant,
Allan Hancock College ("defendant"), both contend:
(1) the plain meaning of section 4646, as amended, authorizes
the settlement of prospective vocational rehabilitation
services, irrespective of the employee's date of injury,
if the section's criteria have been met; (2) the
amendments to section 4646 are remedial (i.e., the amendments
do not affect existing contractual or vested rights, but
simply provide a means for an injured worker to settle his or
her prospective claim for vocational rehabilitation) and,
therefore, the amendments are subject to retrospective
application; and (3) a letter from the Assemblyman who
authored the amendments to section 4646 establishes it was
the Legislature's intent that the amendments be
considered procedural, not substantive, and that they be
applied to all dates of injury.
Because
of the important legal issue presented, and in order to
secure uniformity of decision in the future, the Chairman of
the Appeals Board, upon a majority vote of its members, has
assigned this case to the Appeals Board as a whole for an en
banc decision. (Lab. Code, §115.)
2 Based on our review
of the relevant statutory and case law, we conclude that the
amendments to section 4646, which permit a defendant and a
represented employee to settle prospective vocational
rehabilitation services under specified circumstances, cannot
be applied to injuries sustained before the January 1, 2003
effective date of the amendments because the amendments are
substantive, not procedural, and because there is no clear
indication that the Legislature as a whole intended that the
amendments operate retrospectively.
I.
BACKGROUND
Applicant
claimed to have sustained industrial injuries to both knees
while employed by defendant on November 6, 1997 and from 1985
to August 20, 2002.
3
Formerly,
Labor Code section 4646 had provided:
"Settlement or commutation of prospective vocational
rehabilitation services shall not be permitted under Chapter
2 (commencing with Section 5000) or Chapter 3 (commencing
with Section 5100) of Part 3 except upon a finding by a
workers' compensation judge that there are good faith
issues that, if resolved against the employee, would defeat
the employee's right to all compensation under this
division."4
Effective
January 1, 2003, however, section 4646 was amended to
provide:
"(a) Settlement or commutation of prospective vocational
rehabilitation services shall not be permitted under Chapter
2 (commencing with Section 5000) or Chapter 3 (commencing
with Section 5100) of Part 3 except as set forth in
subdivision (b), or upon a finding by a workers'
compensation judge that there are good faith issues that, if
resolved against the employee, would defeat the
employee's right to all compensation under this division.
"(b) The employer and a represented employee may agree
to settle the employee's right to prospective vocational
rehabilitation services with a one-time payment to the
employee not to exceed ten thousand dollars ($10,000) for the
employee's use in self-directed vocational
rehabilitation. The settlement agreement shall be submitted
to, and approved by, the administrative director's
vocational rehabilitation unit upon a finding that the
employee has knowingly and voluntarily agreed to relinquish
his or her rehabilitation rights. The rehabilitation unit may
only disapprove the settlement agreement upon a finding that
receipt of rehabilitation services is necessary to return the
employee to suitable gainful employment.
"(c) Prior to entering into any settlement agreement
pursuant to this section, the attorney for a represented
employee shall fully disclose and explain to the employee the
nature and quality of the rights and privileges being
waived."5
On or
about November 19, 2002, the parties submitted (and the WCJ
approved) a compromise and release agreement
("C&R"), settling most issues relating to
applicant's November 6, 1997 specific injury and 1985 to
August 20, 2002 cumulative injury claims. Among other things,
the approved C&R provided that applicant "does not
wish to pursue vocational rehabilitation services and
benefits at this time," that applicant waives any and
all claims for retroactive vocational rehabilitation benefits
or services to date, and that applicant was settling
"all injuries…that might occur in the future
during participation in vocational rehabilitation." The
C&R did not seek to resolve prospective vocational
rehabilitation benefits or services, presumably because, at
the time the C&R was executed and approved, such
prospective benefits or services unquestionably could not be
settled absent a good faith issue that could have defeated
applicant's right to all workers'
compensation benefits. (Former Lab. Code, §4646; see
also, Lab. Code, §5100.6; Thomas v. Sports Chalet,
Inc. (1977) 47 Cal.Comp.Cases 625 (Appeals Board en
banc).)
However,
on January 29, 2003 (i.e., after the effective date of the
amendments to section 4646), the parties submitted to the
Rehabilitation Unit a "Settlement of Prospective
Vocational Rehabilitation Services [Lab. Code,
§4646(b)]" (DWC Form RU-122). This proposed
settlement, which was signed by applicant and his
attorney,
6 stated: "The parties hereby agree
to settle the employee's right to prospective Vocational
Rehabilitation services with a one-time payment to the
employee for the sum of $10,000… ."
Thereafter,
the Rehabilitation Unit issued a Determination that
disapproved of the parties' proposed settlement of
prospective vocational rehabilitation services because
"the injured employee's date of injury predates
1-1-03."
Defendant
filed a timely appeal with the Workers' Compensation
Appeals Board ("WCAB"), together with a declaration
of a readiness, challenging the Rehabilitation Unit's
Determination.
At the
trial on the rehabilitation appeal, applicant submitted into
evidence a September 1, 2002 letter to Richard Gannon, the
Administrative Director of the Division of Workers'
Compensation, from Assemblyman Thomas M. Calderon, the Chair
of the Assembly's Insurance Committee. We take judicial
notice that it was Assemblyman Calderon who introduced
Assembly Bill No. 749 ("AB 749"), which made the
amendments to section 4646 at issue here and which was signed
by the Governor on February 15, 2002. In this letter,
Assemblyman Calderon stated, in relevant part:
"I have recently reviewed various proposed regulations
to implement AB 749 (Calderon), including regulations
relating to settlement of prospective vocational
rehabilitation.
"It appears as though the Department of Industrial
Relations (DIR) has taken the position that the legislative
intent of AB 749 is to limit such settlements to injuries
occurring on or after Jan[uary] 1, 2003, and are proposing
regulations to bar settlement of vocational rehabilitation
for injuries prior to that date.7
"Such an interpretation flies in the face of our intent.
If the legislature wishes to specify the effective date of a
...