What’s the most typical response to any consent and release offer made throughout California’s workers’ comp system?

Gregory Grinberg

You might think it’s “more money, please,” but you’d be wrong. Back when we still appeared in person at the Workers' Compensation Appeals Board, you would hear the rich, ceremonial exchange much like you would expect to hear “thunder” and “flash” in World War II — the answer being, of course, “Will your client require a resignation?”

Well, as we know, Labor Code Section 2810.8 now requires employers to prioritize rehiring employees laid off due to COVID-19 for covered industries, and, in 2019, Gov. Gavin Newsom signed into law Assembly Bill 749, which rendered unenforceable any agreement to not seek rehire with an employer as part of any C&R.

Sacramento is not done. Eager to continue restricting an employer’s ability to choose who it does or does not do business with, earlier this year, Sen. Maria Elena Durazo introduced Senate Bill 723, which would expand the scope of Labor Code 2810.8 from COVID-19 layoffs to any employee with more than six months on the job who was let go as a result of “a public health directive, government shutdown order, lack of business, reduction in force or other economic nondisciplinary reason.”

SB 723 also removes the sunset provision placed on Section 2810.8, which was set to be rescinded at the end of 2024.

Of course, the employer will still be required to notify any “laid-off” employee of an open position and faces penalties for failing to prioritize previously laid-off employees. 

Again, Sacramento is intent on making regulatory compliance impossible for functioning businesses in California. Hopefully, SB 723 will be dismissed from the Legislature for the job-killing bill that it is.

In the meantime, perhaps defendants must be more careful about resignation language when resolving claims. If SB 723 does become law, should resignation letters reflect that this is a voluntary resignation and not a layoff as contemplated by Labor Code Section 2810.8?

Well, picture this: Applicant goes off work on temporary total disability for an accepted injury. In the meantime, the employer has to institute layoffs for one of the reasons enumerated in SB 723. Applicant enters into a C&R with the employer and, because he is already laid off, no resignation is requested as part of the C&R.

Three months after the C&R check clears, business picks up and the employer needs to hire more employees. Does applicant now have priority for that same job? It sounds like, under SB 723, applicant does and the employer is stuck paying for the same injury a second time. 

The level of compliance necessary to avoid being sanctioned by California rises and rises. Sadly, Sacramento does not appear to concern itself with helping the employers that barely made it through three years of lockdowns due to COVID-19. 

Gregory Grinberg is managing partner of Gale, Sutow & Associates’ S.F. Bay South office and a certified specialist in workers’ compensation law. This post is reprinted with permission from Grinberg’s WCDefenseCA blog.