Calif. Employers Still Guessing If Comp Reforms Can Withstand New Governor

ANAHEIM, California — Seven months into the administration of Gov. Gavin Newsom, employers in solid-blue California are still waiting to see how well the workers’ compensation reforms championed by his predecessor will fare under new leadership.

So far, so good, but it’s still early. That sums up comments made by California Coalition on Workers’ Compensation Managing Director Paul Yoder and lobbyist Jason Schmelzer during the opening day of the group’s annual conference on Wednesday. The CCWC advocates for employers at the state legislature and educates members on the workers’ comp system.

At least year’s conference, Schmelzer and Yoder celebrated the reforms signed into law in 2012 by Gov. Jerry Brown, a workers’ comp pragmatist who blocked attempts by fellow Democrats to roll back cost-saving rules on utilization review, independent medical review and apportionment. The legislation saves California employers an estimated $1.3 billion annually, according to the Workers’ Compensation Insurance Ratings Bureau.

This year, the governor’s office remains occupied by a Democrat and Democrats still hold a two-thirds majority in both chambers of the legislature. Yoder displayed a series of maps that showed voting patterns in presidential elections since 1936: The 2016 map showed a wall of solid blue down the coast of California, where the large majority of its population lives.

“It’s amazing to be in a state so big and have so much Democratic dominance,” Yoder said.

Schmelzer noted that one state lawmaker — (he didn’t say a name, but it was Assemblyman Brian Maienschein from San Diego) — switched his party registration from Republican to Democrat in January. And he said Republicans will fare poorly in California as long as long as President Donald Trump remains in office. He displayed a slide of a political cartoon depicting Trump running up to a California wildfire with a can of gasoline. The caption: “May I be of assistance?”

So for employers interested in running a cost-effective workers’ comp system, their best bet is moderate Democrats. Newsom is liberal, Schmelzer said, but it remains to be seen whether he will take a more practical stance when it pertains to workers’ comp. So far, no serious workers’ compensation bills have come to his desk.

But Yoder and Schmelzer pointed to some hopeful signs. Yoder said Newsom has appointed a disparate group of advisers as his “kitchen cabinet,” much like President Abraham Lincoln’s infamous “team of rivals.” That includes one notable workers’ comp political player: former California Labor Federation lobbyist Angie Wei, who is now the governor’s deputy chief deputy secretary for policy development. Wei was a chief negotiator when business and labor groups negotiated behind closed doors to draft a reform plan that boosted benefits while cutting employer costs, which became SB 863.

Another notable for employers: Newsom appointed Anthony Williams, a former lobbyist for the Boeing Co., as his legislative secretary. Yoder noted that Newsom’s chief of staff, Ann O’Leary, was a former top aide for Hillary Clinton.

“That guy has an absolutely whip-sharp team, Schmelzer said.

Down in the legislative trenches, Schmelzer went through a list of bills that the coalition has been watching this year. None propose major system changes. Most are bills that would expand presumptions for public safety workers, a perennial headache for public-sector employers, he said.

But there are still two months left in California’s nearly year-round legislative session.

“It’s almost August and that’s the the stuff that nobody has talked about hits the scene,” Schmelzer said.

The CCWC conference, held at the Grand Californian hotel at Disneyland, concludes on Friday.