The Workers' Compensation Appeals Board (WCAB) is a creature of statute, and its subject matter jurisdiction is limited to the grants of authority conferred by the Legislature. Although it generally has jurisdiction over all injuries occurring within California, it has limited jurisdiction for injuries occurring outside of the state.
Subject matter jurisdiction over injuries occurring outside California is governed primarily by two statutes. Labor Code § 3600.5(a) extends jurisdiction to out-of-state injuries when the employee was hired or is regularly working in California. LC 5305 separately confers jurisdiction when the employee is a California resident at the time of injury and the contract of hire was made in California. The residency requirement of LC 5305 has long been recognized as unconstitutional, leaving the contract of hire as its operative element in practice. So, the Labor Code gives the appeals board jurisdiction over claims for out-of-state injuries when either (1) the contract for hire was made in California, or (2) the out-of-state injured worker is regularly employed in California.
Due to the dramatic and permanent transformation of the workforce brought about by the widespread adoption of remote work, it's not uncommon for employees to work for California-based companies entirely from other states. Because California workers' compensation laws generally are considered more protective and favorable to employees than those of most other states, disputes over jurisdiction in remote work cases have become an increasingly significant issue.
A recent panel decision, Danzey v. Aravo Solutions, Inc., 2026 Cal. Wrk. Comp. P.D. LEXIS 164, addresses the jurisdictional framework to be applied to a remote employee who worked entirely out-of-state for a California-incorporated employer. The decision addresses three important issues: whether a choice-of-law clause in an employment contract can confer jurisdiction; whether a defendant's litigation conduct can waive or establish jurisdiction; and whether the reasoning of Atlanta Falcons v. WCAB (Gandy), (2025) 114 Cal. App. 5th 1268 — which involved a professional athlete employed by a California-based sports team — extends to nonathlete remote work cases.
The applicant, a remote worker from Florida, was employed by a company incorporated in California and headquartered in San Francisco. She filed an application for adjudication in Van Nuys, alleging a cumulative trauma injury to multiple body parts that occurred at a San Francisco address.
The defendant asserted that California lacked jurisdiction, and also petitioned to change venue to San Francisco on the ground that the application alleged that the injury occurred there. Venue was transferred. The matter proceeded to trial on the sole issue of subject matter jurisdiction over the applicant's claim pursuant to LC 3600.5 and LC 5305. The parties stipulated that the applicant signed the employment contract in Florida, resided in Florida and never physically worked in California.
The evidence at trial included the applicant's employment contract, which stated, "This Agreement will be governed by the laws of the State of California." Witnesses gave conflicting accounts of the hiring process, but the testimony ultimately established that a Texas-based individual with actual hiring authority delegated to a California-based employee the authority to extend the offer to the applicant, and that she received and accepted the offer while residing in Florida. It established that her direct supervisor at the time of injury was based in California. The employer also offered evidence that although it was incorporated and headquartered in California, the founder lived in Spain, Texas, and was the "nerve center" of the company, where most of the meetings occur, and where human resources, payroll and most executives were located, and that it maintained offices in Texas, Oregon and a small remote office in the United Kingdom.
The applicant argued that because the oral abuse and harassment underlying her claim originated from California-based employees, her injuries should be deemed to have occurred in California. She also argued that the defendant waived jurisdiction by failing to raise it promptly, admitted jurisdiction by petitioning to change venue and was judicially estopped from contesting jurisdiction because it had not done so in a related civil proceeding.
The WCAB denied reconsideration and affirmed the WCJ's finding that California lacks subject matter jurisdiction over the claim. The appeals board explained that it is solely a creation of the Legislature, and its fundamental subject matter jurisdiction is limited by statute.
The WCAB rejected the applicant's assertion that the employment contract conferred California with jurisdiction over her claim. It explained that the parties cannot confer subject matter jurisdiction through a contract if it does not otherwise exist as a matter of statute. It added that even if the employment contract clearly and unambiguously stated that any dispute over workers' compensation was to be filed in this state, such a clause could not confer subject matter jurisdiction over the claim unless there was an independent, statutory basis for the exercise of that jurisdiction.
As a matter of black-letter law, the WCAB held that subject matter jurisdiction cannot be waived. It further found that, even if jurisdiction could be waived, the defendant had timely raised the issue in its answer to the application for adjudication. The WCAB also found that the defendant's petition for change of venue did not confer jurisdiction because it was based on representations by the applicant in the application for adjudication that the injury occurred in San Francisco. The WCAB similarly rejected the applicant's judicial estoppel argument, explaining that the Superior Court and the WCAB are governed by different jurisdictional standards, and that subject matter jurisdiction in one California forum does not establish it in another.
It then addressed the three statutory bases for jurisdiction: injury in California under LC 5300; hire or regular employment in California under LC 3600.5(a); and a contract for hire in California under LC 5305. The WCAB rejected the applicant's argument that the locus of her injuries should be deemed California because the harassment allegedly originated from California-based employees. It reasoned by analogy: If someone in California is injured by a firework discharged from across state lines in Nevada, the party was injured in California, not Nevada. The same logic applied to the present case — a Florida-based employee who receives harassing communications from California-based co-workers is injured in Florida, where the communications are received and experienced. The WCAB found that it was evident from the record that the applicant was not regularly employed in California. Moreover, the parties stipulated that she signed her employment contract in Florida. The WCAB explained that under binding appellate precedent, the location of hire for purposes of LC 3600.5(a) and LC 5305 is where the offeree accepts the offer of employment.
Finally, the WCAB added that although it was not raised by the parties, Atlanta Falcons v. WCAB (Gandy), (2025) 114 Cal. App. 5th 1268, suggested that a professional athlete employed by a California-based sports team could be deemed hired in California based solely on the employer's identity as a California-based team, even if the offer was accepted elsewhere. Assuming without deciding that Gandy's reasoning could extend beyond professional athletes, the WCAB declined to apply it. The WCAB found that the facts did not clearly show the employer was California-based, even though it was incorporated and "headquartered" in California because its nerve center, primary operations, executive leadership and hiring functions were all located in Texas.
Danzey is a significant decision for employers and insurers managing claims from remote workers. As the remote workforce has expanded, the filing of workers' compensation claims in California by employees who have never worked in the state — but whose employers are incorporated or headquartered here — could become a recurring challenge. Danzey provides clear and well-reasoned authority for the proposition that California incorporation and a California headquarters address, standing alone, do not support jurisdiction over a remote worker hired and injured in another state.
The decision reinforces two fundamental principles that practitioners should keep in mind. One, choice-of-law clauses in employment contracts will not be dispositive on the issue of WCAB subject matter jurisdiction. Two, subject matter jurisdiction cannot be waived.
The WCAB's rejection of this applicant's argument that the "source of harassment" could support California jurisdiction is especially important. If the WCAB had jurisdiction over an out-of-state employee's injury claim just because the employee alleged that she or he was subject to oral abuse or harassment from California-based supervisors, it would have opened California to a wide number of claims by remote workers who were never hired in California and never worked in the state. By rejecting the applicant's argument, the WCAB has made clear that it is the location of the workplace that is central to determining where the injury occurred.
Finally, although the WCAB has jurisdiction when a contract for hire was made in California, in workers' compensation, a contract is formed where the acceptance of the offer physically takes place. The WCAB raised the possibility that Gandy could extend beyond professional athletes. It suggested that a California-based team’s location in California would supply the necessary connection to this state to deem the contract a California contract if the evidence clearly and unambiguously established that an employer was California-based, even if the acceptance occurred outside the state. But the WCAB's discussion of that potential extension was framed as an assumption for purposes of argument only ("assuming without deciding"), making it dicta within Danzey itself. Nevertheless, the WCAB suggested that Gandy might apply when the employer is clearly and unambiguously based in California. Accordingly, practitioners should develop the record on the employer's actual operational center, where hiring and human resources functions reside and where the majority of employees work, rather than focusing solely on the state of incorporation.
Practitioners should note that Danzey is a panel decision and is not binding. Although it is citable, its application could be fact-dependent, and further development in this area should be anticipated as remote work arrangements continue to generate jurisdictional disputes. For further discussion, see Sullivan on Comp Section 2.9 Jurisdiction Over Out-of-State Injury.