The History of Workers' Compensation in California

Workers' compensation programs were an outcome of the Progressive Era, when reformers responded to both labor and employer concerns about high rates of work-related injuries, insufficient compensation to injured workers, and continuing employer uncertainty about how to predict the costs related to these injuries.

In what is known as the "grand compensation bargain," California's workers traded the right to sue an employer for damages in the tort or civil law system for benefits in a "no-fault" administrative law system. In 1911, California first provided for voluntary workers' compensation disability benefits (Roseberry Act). Then in 1913 the Boynton Act was enacted establishing a compulsory workers’ compensation system followed by “The Workman's Compensation Insurance and Safety Act of 1917”.

 "The purposes of the Act are several. It seeks (1) to ensure that the cost of industrial injuries will be part of the cost of goods rather than a burden on society, (2) to guarantee prompt, limited compensation for an employee's work injuries, regardless of fault, as an inevitable cost of production, (3) to spur increased industrial safety, and (4) in return, to insulate the employer from tort liability for his employees' injuries." S.G. Borello & Sons v. DIR (1989) 48 CA3d 341

The basic type of benefits provided have remained the same  but  sweeping legislative changes have occurred in recent years which have had a major impact on California’s workers' compensation system.

In 1989 and 1993, California implemented major statutory changes to address a broad range of workers' compensation issues. Highlights of these reforms include restructuring the medical-legal process, limiting compensability of psychiatric and post-termination claims, increasing benefit payments for moderate and serious disabilities, capping vocational rehabilitation payments, increasing fraud deterrence, and deregulating insurance rates.

Major changes also occurred in January 2004 (SB 228 and AB 227), April 2004 (SB 899), and January 2013 (SB 863) introducing utilization review of medical treatment requests, the use of the AMA guides to evaluate permanent impairment, the elimination of vocational rehabilitation, and most recently the addition of independent medical review which put the authority to make medical treatment decisions in the jurisdiction of a private for profit corporation, Maximus.

California's workers' compensation system is highly polarized. It is a multi-billion dollar industry involving a wide variance in special interests. Recent reforms watered down injured workers' benefits and access to necessary medical treatment to save costs to employers. These reforms have also created the need for an  increased bureaucracy that is so complex  it produces considerable grief to those who must deal with it on a daily basis.

The late David  DePaolo noted in one of his many blogs in Work Comp Central that California workers' compensation is "the single largest privatized social benefit system in the world, second only to Social Security in the delivery of medical and indemnity benefits....When you get down to it, workers' compensation, at its most basic function, is just taking care of people."

See the below link for more information on the Boynton Act and California’s celebration of the 100 year history of Workers’ Compensation