Do the increases in Labor Code sections 4661.5 and 4659 apply to death benefits?
Labor Code Section 4661.5 can and does apply to death benefit payments pursuant to Phillips v. Sacramento Mun. Utils Dist. (1998) 63 CCC 585 in my opinion. Labor Code section 4659 appears clear: “…an employee who becomes entitled to receive a life pension or total permanent disability indemnity is to have that payment increased annually commencing on January 1, 2004, and each January 1 thereafter, by an amount equal to the percentage increase in the ‘state average weekly wage’ as compared to the prior year.” Emphasis added.
However at least one case held as follows:
“COLA for death benefits payable at TD rate would continue throughout dependent’s life, when in fact they do not continue indefinitely but are capped at two-thirds of injured employee’s average weekly earnings at time of injury… This is because death benefit payments that have or will be made two years or more after the date of injury must be made at the TD rate in effect at the time each payment is made. (Lab. Code, § 4661.5; Phillips v. Sacramento Municipal Utilities Dist. (1998) 63 Cal.Comp.Cases 585 (Appeals Board en banc).) Further, when the two-year period has elapsed, ‘[c]ommencing on January 1, 2007, and each January 1 thereafter, the [TD-and, therefore, death benefit payments] shall be increased by an amount equal to the percentage increase in the [SAWW] for the prior year.’ (Lab. Code, § 4453(a)(10).) Accordingly, with death benefits-as with PTD benefits-an increase based on the change in the SAWW does come into play. However, unlike PTD benefits, the [*29] annual increases in the death benefits rate based on the SAWW do not continue indefinitely for the recipient’s life. This is because, regardless of the SAWW increases, the death benefits are eventually capped at two-thirds of the injured employee’s average weekly earnings at the time of injury. (Lab. Code, § 4653.)” Melissa J. Munson (Deceased), Dean L. Munson, Individually and as Guardian Ad Litem and Trustee for Carl E. Munson, et al., Applicant v. City of Los Angeles Police Department, PSI, Tristar Risk Management (Claims Administrator), Defendants 2011 Cal. Wrk. Comp. P.D. LEXIS 387. [Emphasis added].
So what is the conclusion? Simple: every case must be analyzed on an individual basis. If the facts of any death case reflect earnings sufficient to apply the above increases, increases should be calculated then considered for application to the case. So in some cases the SAWW/COLA may come into play on death benefits, just not cases lacking sufficient earnings supporting higher rates.
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