The Subsequent Injuries Fund (SIF) is also known as the Subsequent Injuries Benefits Trust Fund (SIBTF). These are complex cases involving catastrophic injuries. A SIF case is present when preexisiting disability combines with a subsequent industrial injury to produce a current disabiltiy of seventy percent (70%) or more. The idea behind SIF cases is for the State to pay handicapped workers who suffer a subsequent industrial injury. The employer is insulated from liability and thus they are encouraged to hire handicapped or disabled workers.
Specifically, SIF cases provide additional benefits under specified circumstances when an employee with a prior disability suffers a subsequent workplace injury. The SIF provides compensation “for the remainder of the combined permanent disability existing after the last injury” (§ 4751) less the amount of all benefits received by the employee on account of the preexisting disability (§ 4753). The payments come from the Subsequent Injuries Benefits Trust Fund (SIF), a state supervised trust funded by surcharges imposed upon employers in proportion to their payrolls. (§§ 62.5, subds. (d), (e), 4751 et seq.) Thus, for the most serious injuries, the SIF allows the employee to obtain compensation commensurate with his or her overall disability without making the employer liable for more than the amount due for the most recent industrial injury. The purpose of this provision, is to encourage hiring and retention of disabled workers. (State of California v. Ind. Acc. Com. (1957) 147 Cal.App.2d 818, 822, disapproved on other grounds by Subsequent Injuries Fund v. Industrial Acc. Com. (1961) 56 Cal.2d 842, 846.)
SIF cases are governed by Labor Code Section 4751 which provides:
If an employee who is permanently partially disabled receives
a subsequent compensable injury resulting in additional permanent
partial disability so that the degree of disability caused by the
combination of both disabilities is greater than that which would
have resulted from the subsequent injury alone, and the combined
effect of the last injury and the previous disability or impairment
is a permanent disability equal to 70 percent or more of total, he
shall be paid in addition to the compensation due under this code for
the permanent partial disability caused by the last injury
compensation for the remainder of the combined permanent disability
existing after the last injury as provided in this article; provided,
that either (a) the previous disability or impairment affected a
hand, an arm, a foot, a leg, or an eye, and the permanent disability
resulting from the subsequent injury affects the opposite and
corresponding member, and such latter permanent disability, when
considered alone and without regard to, or adjustment for, the
occupation or age of the employee, is equal to 5 percent or more of
total, or (b) the permanent disability resulting from the subsequent
injury, when considered alone and without regard to or adjustment for
the occupation or the age of the employee, is equal to 35 percent or
more of total.
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The 5% "Opposite and Corresponding" Member Requirement
For the 5% opposite and corresponding member criteria, the subsequent injury must only affect the opposite and corresponding member; it need not injure that member directly. This was detailed in the case of Hard v. WCAB (1974) 2 CWCR 48. In the Hard case the applicant had lost his left leg prior to the industrial injury. The industrial injury involved a back injury that caused problems into the applicant's right leg. The WCAB panel held "applicant qualifies for subsequent injuries fund benefits because the back injury affected the right leg which is the opposite and corresponding member to the previously impaired left leg.". See also: Gillispie v. Plastech (SIBTF) (2010) 38 CWCR 304 (WCAB) wherein the WCAB held that LC Section 4751 requires only that the subsequent injury “affect the opposite and corresponding member” (such as radicular sx’s in the leg as result of a back injury); it does not require that the opposite member have pathology or be injured.
The "Opposite and Corresponding" member requirement can be met with multiple combinations (e.g. - hand and opposite knee, shoulder and opposite hip, etc.). The requirement is not limited to extremities. In SIF v. IAC (Hanson)(1963) 217 Cal. App. 2d 322, on May 28, 1959, the applicant, Bruce S. Hanson, was injured in an automobile accident. The major effect of this industrial injury was to accelerate an existing diabetic retinitis to produce blindness of the right eye. Prior to the injury and as a result of the same disease process, applicant had already suffered practically complete loss of vision in the left eye. Here the eye injuries were Opposite and Corresponding members. A similar case was SIF v. IAC (Patterson) 1952 39 Cal.2d 83. In Patterson the subsequent industrial right eye injury rated at 26% PD. When combined with the pre-existing left eye injury, SIF liability was present.
The 5% disability to the opposite and corresponding member does not have to be completely within the injured member. For example, if the subsequent industrial injury involves the neck and arm, then the arm injury need not rate 5% as long as the neck combined with the arm combine to produce a 5% disability. In addition to not needing a subsequent injury causing a 5% disability in the opposite and corresponding member, the subsequent injury need only affect the opposite and corresponding member and cause an overall disabiltiy of 5% or more. SIF v. WCAB (Post) (1976) 41 CCC 436.
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The 35% threshold
The 35% threshold is calculated before adjustment for occupation and age.
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The Pre-existing Disability
The Pre-existing disability for SIF purposes must have been present at the time of the subsequent industrial injury.
Under the 1957 Bachrach case (SIF v. IAC) (Bachrach) 147 Cal. App. 22 818 , the existence of a non-disabling pathological condition is not sufficient to justify entitlement to SIF benefits. And per Franklin v. WCAB (1978) 79 Cal. App.3rd 224, a retroactive prophylactic work restriction will not support SIF liability.
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How SIF awards relate to SSDI benefits
Under POMS Section: DI 52120.030, the SSA sets out their rules for Offsets In SIF cases. Under this section, the basic WC payment is offsettable, however, the additional payments which are made from the Subsequent Injuries Fund are not offsettable. Reverse offset applies to SIF payments.
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SIF Credits
SIF Credits are governed by California Labor Code Section 4753 which provides:
California Labor Code Section 4753
Such additional compensation is not in addition to but shall be reduced to the extent of any monetary payments received by the employee, from any source whatsoever, for or on account of such preexisting disability or impairment, except as to payments being made to the employee or to which he is entitled as a pension or other compensation for disability incurred in service in the armed forcesof the United States, and except as to payments being made to him or to which he is entitled as assistance under the provisions of Chapter2 (commencing with Section 11200), Chapter 3 (commencing with Section 12000), Chapter 4 (commencing with Section 12500), Chapter 5(commencing with Section 13000), or Chapter 6 (commencing with Section 13500) of Part 3, or Part 5 (commencing with Section 17000),of Division 9 of the Welfare and Institutions Code, and excluding from such monetary payments received by the employee for or on account of such preexisting disability or impairment a sum equal to all sums reasonably and necessarily expended by the employee for or on account of attorney's fees, costs and expenses incidental to the recovery of such monetary payments. All cases under this section and under Section 4751 shall be governed by the terms of this section and Section 4751 as in effect on the date of the particular subsequent injury.
SIF is not entitled to Credit for Vetran's Benefits//Service Connected Disabilities. In Webineer v. WCAB (SIF) (1975) 40 CCC 774 - , the Subsequent Injuries Fund was entitled to a credit for payments made to an injured employee under a Veterans Administration pension and as Social Security disability benefits only to the extent to which these payments were for a non-service connected disability which pre-existed the industrial injury. [See also Hanna, California Law of Employee Injuries and Workmen's Compensation, Vol. 1, § 9.05[4][a].]
SIF is entitled to Credit for SSDI benefits for the percentage of SSDI that is related to the pre-existing PD. The formula is (100%-Comp. PD= % x SSDI benefits = offset). The SSDI credit will end once the worker reaches retirement age and the SSDI benefit converts to retirement benefits. Calculating the Social Security credit can be rather complex. To properly assess the credit four things need to be known: 1. The date of entitlement to SSDI benefits and the beginning date of these benfits; 2. Dates and amount of changes in monthly SSDI benefits after deductions; 3.If SSDI benefits have been terminated, the date reason for the termination must be known; and finally 4 The date of entitlement of Retirement. This information should be obtained from the Social Security Administration. We have seen the information provided on SSA form WNPSC-3070E (9/07).
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