Cal. Code Regs. Tit. 8, § 10112.2 - Schedule of Administrative Penalties Pursuant to Labor Code Section 5814.6
(a) Administrative
penalties shall only be imposed under this section based on violations of Labor
Code section
5814, after
more than one penalty award has been issued by the Workers' Compensation
Appeals Board on or after June 1, 2004 based on conduct occurring on or after
April 19, 2004 for unreasonable delay or refusal to pay compensation within a
five year time period. The five year period of time shall begin on the date of
issuance of any penalty award not previously subject to an administrative
penalty assessment pursuant to Labor Code section
5814.6.
(b) The Division of Workers' Compensation
shall at least monthly submit copies of WCAB decisions, findings, and/or awards
issued pursuant to Labor Code section
5814 to the
Audit Unit.
(c) The Audit Unit
shall obtain monthly Labor Code section
5814 activity
reports and shall determine if the decisions, findings, and/or awards are
final. If more than one final penalty award has been issued on or after June 1,
2004 against a claims administrator at a single adjusting location, the Audit
Unit may proceed with an investigation.
(d) To determine whether a violation
described in Labor Code section
5814.6 has
occurred, and notwithstanding Labor Code section
129(a) through
(d) and section
129.5
subdivisions (a) through (c) and sections
10106,
10106.1,
10107 and
10107.1 of Title 8 of the
California Code of Regulations, the Administrative Director, or his or her
designee, may conduct an investigation, which may include but is not limited to
an audit of claims and/or utilization review files. The investigation may be
independent of, or may be conducted concurrently with, an audit conducted
pursuant to Labor Code section
129 and
129.5.
(e) The Administrative Director, or his or
her designee, may also utilize the provisions of Government Code sections
11180
through
11191 to
carry out the responsibilities mandated by Labor Code section
5814.6.
(f) The Administrative Director may issue a
Notice of Assessment under this article in conjunction with an order to show
cause pursuant to section
10113 of Title 8 of the California
Code of Regulations, charging both an administrative penalty under this section
and a civil penalty under subdivision (e) of Labor Code section
129.5 in the
same pleading, however only one penalty may be imposed by the Administrative
Director following the hearing on such charges.
(g) Pursuant to Labor Code section
5814.6, the
Administrative Director, or his or her designee, shall issue a Notice of
Assessment for administrative penalties against an employer and/or insurer as
follows:
(1) $ 100,000 for when the
Administrative Director, or his or her designee, has evidence to support a
finding that an employer or insurer knowingly violated Labor Code section
5814 with a
frequency that indicates a general business practice, and additionally for each
applicable penalty award, the following;
(2) $ 30,000 for each penalty award by the
Workers' Compensation Appeals Board for a violation of Labor Code section
5814 for an
unreasonable delay or refusal to comply with an existing compensation
order;
(3) For each penalty award
by the Workers' Compensation Appeals Board for a violation of Labor Code
section
5814 for an
unreasonable delay or refusal to make a payment of temporary disability
benefits or salary continuation payments in lieu of temporary disability;
vocational rehabilitation maintenance allowance, life pension, or death
benefits:
(A) $ 5,000 for 14 days or less of
indemnity benefits;
(B) $ 10,000
for 15 days through 42 days of indemnity benefits;
(C) $ 15,000 for more than 42 days of
indemnity benefits.
(4)
For each penalty award by the Workers' Compensation Appeals Board for a
violation of Labor Code section
5814 for an
unreasonable delay or refusal to provide authorization for medical treatment:
(A) $ 1,000 for retrospective medical
treatment authorization;
(B) $
5,000 for prospective or concurrent medical treatment authorization;
(C) $15,000 for prospective or concurrent
medical treatment authorization when the employee's condition is such that the
employee faces an imminent and serious threat to his or her
health.
(5) For each
penalty award by the Workers' Compensation Appeals Board for a violation of
Labor Code section
5814 for an
unreasonable delay or refusal to reimburse an employee for self-procured
medical treatment costs:
(A) $ 1,000 for
medical treatment costs of $100 or less, excluding interest and
penalty;
(B) $ 2,000 for medical
treatment costs of more than $100 to $300, excluding interest and
penalty;
(C) $ 3,000 for medical
treatment costs of more than $300 to $500, excluding interest and
penalty;
(D) $ 5,000 for medical
treatment costs of more than $500, excluding interest and
penalty.
(6) $ 2,500 for
each penalty award by the Workers' Compensation Appeals Board for a violation
of Labor Code section
5814 for an
unreasonable delay or refusal to provide the supplemental job displacement
benefit, as required by section
10133.51(b) and
section 10133.56(c),
respectively, of Title 8 of the California Code of Regulations.
(7) $ 2,500 for each penalty award by the
Workers' Compensation Appeals Board for a violation of Labor Code section
5814 for an
unreasonable delay or refusal to make payment to an injured worker as
reimbursement for payment for services provided for a supplemental job
displacement benefit voucher, or where the unreasonable delay or refusal to pay
the training provider causes an interruption in the employee's
retraining.
(8) For each penalty
award by the Workers' Compensation Appeals Board for a violation of Labor Code
section
5814 for an
unreasonable delay or refusal to make a payment of permanent disability
indemnity benefits:
(A) $ 1,000 for 15 weeks
or less of indemnity benefits;
(B)
$ 5,000 for more than 15 but not more than 50 weeks of indemnity
benefits;
(C) $ 7,500 for more than
50 but not more than 95 weeks of indemnity benefits;
(D) $ 15,000 for more than 95 weeks of
indemnity benefits.
(9) $
2,500 for any other penalty award by the Workers' Compensation Appeals Board
pursuant to Labor Code section
5814 not
otherwise specified in this section.
(h) In cases that the Administrative Director
deems appropriate, the Administrative Director, or his or her designee, may
mitigate a penalty imposed under this section after considering each of these
factors:
(1) The consequences and gravity of
the violation(s).
(2) The good
faith of the claims administrator.
(3) The history of previous penalty awards
under Labor Code section
5814.
(4) The number and type of the
violations.
(5) The time period in
which the violations occurred.
(6)
The size of the claims adjusting location.
(i) Each administrative penalty assessed
under this section shall be doubled upon a second Order (which may be a
Stipulated Order or a final Determination and Order) by the Administrative
Director under Labor Code §
5814.6 against
the same employer or insurer within a five (5) year period. Each administrative
penalty under this section shall be tripled upon a third Order (which may be a
Stipulated Order or a final Determination and Order) by the Administrative
Director under Labor Code §
5814.6 against
the same employer or insurer within the same five (5) year period.
(j) In no event shall the administrative
penalties assessed against a single employer or insurer in a single Stipulated
Order or final Determination and Order after doubling or tripling exceed
$400,000.
Notes
Note: Authority cited: Sections 133, 5307.3 and 5814.6, Labor Code. Reference: Sections 129.5, 139.48, 5814 and 5814.6, Labor Code; and Sections 11180- 11191, Government Code.
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