Gilson Daub San Francisco trial attorney Max Higgins recently obtained a successful outcome for an employer on a Serious & Willful Misconduct claim.
Occasionally, employers will receive a petition for increased benefits for Serious and Willful Misconduct, in connection with the defense of a workers’ compensation claim. The employers are often surprised to learn that liability for such a petition is not covered by their workers’ compensation policy.
Pursuant to Insurance Code section 11661, an insurer may not insure against the employer’s liability for the additional compensation recoverable for Serious and Willful Misconduct. Such was the case on February 14, 2017, when a large restaurant franchise contacted the Gilson Daub San Francisco Bay Area office to defend their interests against the prosecution of a Serious and Willful Misconduct claim brought by a significantly injured worker. The underlying workers’ compensation claim was accepted and carried a potential exposure in excess of $1 million. The 2010 injury was rated as a life-pension, permanent disability award, which exceeded 70%. The workers’ compensation insurance carrier could not secure settlement on the claim, largely due to the allegations of applicant’s attorney, as to the strength and value of the Serious and Willful claim. The Applicant sought an increase in benefits of 50% of the value of the claim from the employer directly because the injury was the employer’s “fault”.
California Labor Code section 4553 provides: The amount of compensation otherwise recoverable shall be increased one-half, together with costs and expenses not to exceed $250, where the employee is injured by reason of the serious and willful misconduct on the part of the (employer).
In order to prevail on a “Serious and Willful” claim, the Applicant must demonstrate that the employer’s misconduct was the proximate cause of the injury. The employee must show that the misconduct actually contributed to the injury.
Once proximate cause is established, the Applicant must also demonstrate more than just employer negligence. Serious and Willful Misconduct involves intention and knowledge. One of the following employer actions must be present:
- A deliberate act for the purpose of injuring another;
- An intentional act with knowledge that a serious injury is a probable result; or
- An intentional act with a positive and reckless disregard of its possible consequences.
Each of these acts implies an awareness of danger on the employer’s part. An employer guilty of Serious and Willful Misconduct must know of the dangerous condition, know that the probable consequences of its continuance will involve serious injury to an employee, and then deliberately fail to take corrective action.
After arguing that the Applicant could not establish the necessary elements of a Serious & Willful Misconduct claim, Gilson Daub attorney, Max Higgins was able to successfully procure settlement by Compromise and Release on all issues, including the Serious & Willful Misconduct, at the March 8, 2017 Mandatory Settlement Conference at the Oakland Workers’ Compensation Appeals Board.
The president and CEO of the large franchise restaurant personally thanked Gilson Daub and Max Higgins for their hard work, effective negotiation strategy and for being able to close a seven-year-old six-figure case in just 23 days.
Max Higgins is a trial attorney with the San Francisco Bay Area office of Gilson Daub, Inc.
Brent Daub is the founder and senior partner of Gilson Daub, Inc.
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