In basic summary, this decision, which can be cited as precedence, held that the 2005 Permanent Disability Schedule can be argued against with respect to the Diminished Future Earning Capacity multiplier for individual injured workers. The Court held that if your work injury affected your earning capacity, and the 2005 disability schedule does not reflect your loss in earning capacity fairly (fairness is governed by a step-by-step analysis), a different calculation may be used to reflect a more fair result.
The WCAB in an En Banc decision held that the DFEC (Diminished Future Earning Capacity) portion of the 2005 Schedule is rebuttable. It cannot be rebutted by 1) establishing the % to which an injured employee's future earning capacity has been diminished, nor 2) by taking 2/3rds of the injured employee's estimated diminished future earnings and then comparing the resulting sum to the PD money chart to approximate a corresponding permanent disability rating.
Itcanbe rebutted by taking the following steps:
1. Injured worker's actual earnings. Establish the injured worker's actual earnings in the three years following the injury using the employee's EDD wage data or other empirical wage data.
2. Similarly situated workers. Get "similarly situated workers'" wage data. This is an estimate, and such information may be gathered from EDD's Labor Market Information Division (LMID) websitei.
3. Individualized proportional earnings lost. Calculate the employee's individualized proportional earnings lost. This is done by subtracting the injured worker's post-injury earningsii from the average earnings of similarly situated workers.
4. Individualized rating to loss ratio. Obtain ratio "a" by dividing the employee's Individualized Proportional Earnings Lost (obtained in step 3) by the proportional earnings found in step 3. This ratio "a" is the injured worker's individualized rating to loss ratio.
5. Compare ratio "a" to Table B. The 2005 PDRS basically took the average standard ratings to average proportional earnings losses ratio for different body parts, and put these ratios into Table B of the schedule. See if "a" is the same as ratio in Table B.
6. Compare ratio "a" to Table A. The 2005 PDRS also created Table A which illustrates a range of ratios of the FEC Rank for that body part. See if "a" falls within the corresponding FEC ranking's ratios in Table A.
7. Rebuttable? If the ratio "a" does NOT fall within the corresponding FEC ratio, i.e. if the injured worker's individualized rating to loss ratio is less than OR greater than the ratio contained in Table B; and falls outside the range of ratios of the FEC Rank for that impairment in Table B, then the Schedule has been rebutted.
8. If rebuttable, then what? What happens next depends on whether "a" falls within the range of ratios for one of the other seven FEC ranks. If it does, go to Step 8a. If it does not, go to step 8b.
8a. If "a" falls within the range of ratios for one of the other seven FEC ranks, then the FEC Rank and the DFEC adjustment factor corresponding to that particular range of ratios shall be used.
8b. If "a" does not fall within the ratios, i.e. if it is higher than 1.810 or lower than 0.450, then the following formula must be used:
([1.81/a] x .1) + 1
Where "a" is the employee's individualized rating to loss ratio found in step 4. The result of this formula would be the injured worker's DFEC adjustment factor.
Possible exceptions to this method of rebuttal:
1. If "a" is negative. In this case, the injured worker's post-injury earnings EXCEED that of the corresponding control group. This is a rare case.
2. If the employee's post-injury earnings portion of that calculation does not accurately reflect his or her TRUE earning capacity. In this hypothetical case, the injured worker would deliberately minimize his or her post-injury earnings, or perhaps voluntarily retire or partially retire for reasons unrelated to the industrial injury.
3. The trier-of-fact may also take into account a variety of factors such as temporary economic downturns.