On June 22, 2023, in Nunes v. State of California, Dept. of Motor Vehicles, the Workers' Compensation Appeals Board (WCAB) issued an en banc holding that:
- Labor Code...
On Aug. 1, 2023, the 2nd District Court of Appeal issued its decision in Earley v. WCAB invalidating the long-standing practice of the Workers' Compensation Appeals Board (WCAB) to grant petitions for reconsideration without first deciding whether reconsideration is warranted. The court held that grant-for-study orders violated Labor Code § 5908.5. But it also held that the WCAB is not required to issue a final ruling on the merits within 60 days. This case was discussed in detail in our previous article.
As noted in that article, the Earley decision will have an immediate impact on the WCAB, because no longer will it be able to issue rubber-stamp decisions granting reconsideration for further study simply to extend the time to act. But the court did not address how its decision would affect existing grant-for-study orders.
Earley noted that as of Nov. 2, 2021, there were 543 workers’ compensation cases awaiting a final decision in which the WCAB had issued a grant-for-study order between Oct. 1, 2018, and Oct. 1, 2021. Although it's reasonable to assume that the WCAB has issued final decisions in some of those cases, it probably issued many more grant-for-study orders between Oct. 1, 2021, and Aug. 1, 2023, the date of the Earley decision.
Many parties might be wondering how they should respond to Earley. Now that an appellate court has held that the WCAB's former practice is invalid, will the prior cases be deemed to be denied by operation of law pursuant to LC 5909? This author believes the answer is no.
In those cases, the WCAB has granted reconsideration to further study the factual and legal issues. It has acted on the petitions pursuant to LC 5909, so those petitions cannot be deemed to have been denied. Earley held that there was no time limit for the WCAB to make a decision after granting reconsideration.
So what's a patiently waiting party to do now in light of Earley? No one knows how the WCAB can clear the backlog. Even though the original decisions granting reconsideration were deemed to be erroneous pursuant to Earley, they could have been appealed by a writ of mandate per LC 5955. In fact, it's likely that a party still may file a petition for writ of mandate to compel a decision. (See Janet v. IAC (1965) 30 CCC 411.)
But filing a petition for writ of mandate is not easy. The appellate courts have very strict form and content requirements, and generally it's costly to file an appeal with an appellate court. It also takes a long time, maybe more than the WCAB will take, to address it. So it might not be practical. The next question is: Must an aggrieved party file a petition for writ of mandate to preserve its right to further appeal? Again, this author believes the answer is no.
Earley did not address whether the decision would apply retroactively. In Camper v. WCAB (1992) 57 CCC 644, the California Supreme Court refused to apply a procedural change to the time limit to file a petition for writ of review retroactively. It held that the 45-day time limit in LC 5950 for filing a petition for writ of review was not extended by Code of Civil Procedure § 1013. The Supreme Court, however, noted that its holding would result in hardship for all litigants who relied on a contrary rule in prior decisional law, and instructed that its decision should be applied prospectively. The Supreme Court stated, "The change affects only the calculation of the date before which a petitioner must file a writ of review pursuant to Labor Code section 5950. We have previously applied such procedural changes prospectively only." The Supreme Court added, "There are numerous workers' compensation actions pending in this state," and, "Justice is not served by barring so many actions that reasonably appeared timely when filed. [Citation omitted]." Although Earley did not expressly announce that its decision applied only prospectively, the same concerns raised by the Supreme Court in Camper would be present if Earley applied to prior cases.
In addition, in Earley, the WCAB attempted to justify its grant-for-study process based on the long tenure of the procedure and the claimed impossibility of issuing a reasoned order in all cases. The Court of Appeal found that to be a misdirected plea for more funding, because the court is not the entity setting the WCAB's budget.
In Shipley v. WCAB (1992) 57 CCC 493, the Court of Appeal determined that the WCAB's inefficiencies and inadequacies should not deprive parties of their appellate rights. In that case, the WCAB did not timely decide a petition for reconsideration because the file was lost or misplaced. The applicant inquired about the status of the petition multiple times before the WCAB issued a decision finding it was denied by operation of law per LC 5909.
Shipley noted that although the language in LC 5909 appeared to be mandatory and jurisdictional, it stated that "[T]he time periods must be based on a presumption that a claimant's file will be available to the board; any other result deprives a claimant of due process and the right to a review by the board." It added, "While we are not convinced that the burden of the system's inadequacies should fall on claimants, in any event Shipley did make inquiries and received reassurances from the board that his petition would be considered either after his file was found or after he reconstructed a duplicate file." Finally, Shipley quoted this language from State Farm Fire and Casualty Co. v. WCAB (Felts) (1981) 46 CCC 622: "It is a fundamental principle of due process that a party may not be deprived of a substantial right without notice [citations], and a rule that the statutory right to judicial review of Board decisions is lost by passage of the 45-day statutory period even though the affected party was not afforded notice of the decision to be reviewed would offend elementary due process principles."
Accordingly, losing the right to appeal based on the WCAB's previous erroneous decisions would invoke due process concerns. Consistent with Shipley, a party should not lose its right to appeal based on the "system's inadequacies." Instead, because a party may not be deprived of a substantial right without notice, any party affected by a previous grant-for-study order should be given notice that further action is required before it loses its right to appeal the WCAB's final order.
Nevertheless, Shipley was persuaded in part by that applicant's inquiries to the WCAB regarding the status of the petition for reconsideration. So, any party affected by an existing grant-for-study order should send a letter to the WCAB requesting the status of its petition for reconsideration, as well as information regarding whether Earley will have an impact on prior cases. The opinions stated in this article reflect only the author's views. But if a party proactively requests information from the WCAB, it's unlikely that, following a WCAB final order, the appellate courts would deny a subsequently filed petition of writ of review based on LC 5909.
For further discussion on the WCAB's actions on a petition for reconsideration, see Sullivan on Comp Section 16.65 Petition for Reconsideration –– Workers' Compensation Appeals Board's Action.