California Labor Code § 4659

Determinative passage · p.16provides that an "employee who becomes entitled to receive a life pension or total permanent disability indemnity... shall have that payment increased annually commencing on January 1, 2004, and each January 1 thereafter, by an amount equal to the percentage increase in the "state average weekly wage" as compared to the prior year. (Lab. Code, § 4659(c).)

Applied to order COLA adjustments starting January 1, 2016.

Determinative passage · p.5Notwithstanding the parties' repeated references to how payments were to be calculated, we are persuaded that the Legislature's use of the word "weeks" in both sections 4658 and 4659 to mark the inception of a life pension, is controlling. This means that applicant is entitled to his life pension after expiration of the time during which the number of weeks of permanent partial disability otherwise would have been payable absent commutation. We therefore conclude that in the Joint Finding and Order of November 13, 2020, the WCJ correctly found that applicant's "life pension shall not be accelerated by the commutation of permanent disability nor the lump sum payment of permanent disability."

The Board applied these statutes and case law to conclude that commutation of permanent disability indemnity does not accelerate the start of life pension payments, affirming the WCJ's original decision.

Determinative passage · p.2Labor Code1 section 4452.5 defines "[p]ermanent total disability" as "a permanent disability with a rating of 100 percent permanent disability only." (Lab. Code, § 4452.5.) Section 4659 states that "[i]f the permanent disability is total, the indemnity based upon the average weekly earnings determined under Section 4453 shall be paid during the remainder of life." (Lab. Code, § 4659(b).)

Applied to confirm that permanent total disability indemnity is payable for life at the calculated rate.

Determinative passage · p.10Cal. Lab. Code sec. 4659(c) dictates that a life pension award shall be subject to an annual increase based on the "state average weekly wage" as increased over the rate from the previous year[.]4

Corrected the SAWW adjustment start date in the Findings and Award.

Determinative passage · p.5Turning to the issue of life pension, Labor Code section 4659(a) provides in relevant part:

Life pension benefits for permanent disability over 70%

Determinative passage · p.3The WCJ's Report avers the present value discount mandated by section 5101 is a discount for the carrier to compensate it for the loss of investing monies commuted and paid to the applicant as a lump sum, while the COLAs of section 4659(c) are designed to insulate applicant's award of disability from inflation and the devaluation of the dollar. (Report, at p. 3.) The WCJ notes that pursuant to California State Bar Rule Sec. 7.955 and section 4903(a), "the essence of a proper attorney's fee is what is reasonable," and that attorney's fees should be reasonable "for both the employee and the attorney." (Id. at p. 4.) The WCJ observes that fees requested by applicant's attorney would "erode applicant's benefits even further making it more difficult to survive," and that "applicant counsel's efforts did not obtain the COLA for applicant as LC 4659(c) is a statutory provision for which all applicants who receive a life pension are entitled." (Id. at p. 6.)

Distinguished the purpose of present value discount and COLAs in attorney fee calculation.

Determinative passage · p.4As to the issue if there is good cause for the Applicant to conduct the deposition of the person most knowledgeable (PMK) for Ericsson as to earnings and earnings capacity, it is found that there is good cause and that Applicant is entitled to conduct the deposition. The Applicant's earnings potential/capacity may be relevant to the issue of the applicant's disability rate.

Defendant argued that earnings capacity is irrelevant under section 4659(c), but the WCJ found earning capacity relevant to disability rate.

Determinative passage · p.2We agree. Section 4659(c) provides for SAWW adjustments to the award of both life pension benefits (section 4659(a)) and permanent total disability benefits (section 4659(b)). Here, the award of 92 percent disability will be followed by a life pension, and the applicable SAWW adjustment will commence on the January 1 following the date on which partial permanent disability benefits are exhausted. Accordingly, we will grant defendant's Petition, and affirm our September 18, 2023 Decision After Reconsideration, except that we will amend Finding of Fact No. 10 to reflect that SAWW adjustment pursuant to Labor Code section 4659(c) shall commence on the January 1 following the date on which partial permanent disability benefits are exhausted.

Applied to amend the timing of SAWW adjustments in this case.