Nunes II: WCAB Upholds Vocational Apportionment as Invalid
Attorney of Counsel, Michael Sullivan & Associates, LLP
On June 22, 2023, in Nunes v. State of California, Dept. of Motor Vehicles, the Workers’ Compensation Appeals Board (WCAB) issued an en banc holding that:
- Labor Code § 4663 “requires a reporting physician to make an apportionment determination and prescribes the standard for apportionment. The Labor Code makes no statutory provision for ‘vocational apportionment.'”
- “Vocational evidence may be used to address issues relevant to the determination of permanent disability.”
- “Vocational evidence must address apportionment, and may not substitute impermissible ‘vocational apportionment’ in place of otherwise valid medical apportionment.”
Following that decision, the applicant filed a petition for reconsideration asserting, among other things, that: (1) a vocational expert may substitute a competing theory of apportionment in place of otherwise valid legal apportionment; (2) evaluating physicians are unwilling or unqualified to evaluate vocational evidence; and (3) requiring vocational experts to address valid medical apportionment will result in “pass-through” apportionment.
On Aug. 29, 2023, the WCAB issued another en banc decision, Nunes v. State of California, Dept. of Motor Vehicles (Nunes II). In it, the WCAB affirms its earlier decision, and clarifies the roles of physicians and vocational experts in addressing the issues of permanent disability and apportionment.
THE WCAB’S DECISION
In Nunes II, the WCAB rejected the applicant’s assertion that a vocational expert may offer a competing or alternate apportionment analysis as inconsistent with LC 4663. The WCAB explained that LC 4663 authorizes and requires that apportionment determinations be made by evaluating physicians. So alternate apportionment schemes espoused by vocational or other expert witnesses are not statutorily authorized and may not be used to circumvent the apportionment mandated by the Legislature.
The WCAB discussed its earlier holding that vocational evidence must address apportionment, and may not substitute impermissible “vocational apportionment” in place of otherwise valid medical apportionment. It explained that an evaluating physician’s apportionment analysis is not assumed to be valid, and must be carefully weighed and determined by the WCJ. The WCAB’s reference to “otherwise valid medical apportionment” in the original decision was an acknowledgment of the proper application of apportionment to a determination of permanent disability; that is, it must be based on an apportionment analysis that constitutes substantial evidence that’s based on a review of the entire record, and that does not rely on an incorrect legal theory.
The WCAB explained that if a WCJ determines that no evaluating physician has identified valid legal apportionment, an applicant is entitled to an unapportioned award, and a vocational expert may not interpose an independent apportionment analysis. Likewise, if a WCJ determines that the apportionment analysis does not constitute substantial evidence, and development of the record is not warranted, an unapportioned award may be issued.
In contrast, the WCAB explained that when a physician identifies a valid basis for apportionment, it must be considered as part of any determination of permanent disability, including a vocational expert’s evaluation of an injured worker’s feasibility for vocational retraining. The WCAB stated that “[A] finding of permanent and total disability notwithstanding the presence of valid nonindustrial apportionment is permissible, so long as the medical and vocational evidence establishes that the permanent and total disability arises solely out of industrial conditions or factors, that is, exclusive of nonindustrial or prior industrial conditions or factors.”
After addressing specifics of that case and explaining why it was necessary to develop the record, the WCAB rejected the applicant’s contention that physicians are ill-equipped and frequently unwilling to address vocational evidence. It noted that many evaluating physicians routinely describe and consider vocational evidence as part of their reporting, and cited multiple Labor Code sections and regulations establishing that physicians have a duty to address work restrictions and work limitations.
It explained that physicians are required to consider vocational evidence in the preparation of a report and may use vocational evidence to assess impairment and permanent disability. It added that vocational evidence may assist physicians in determining which of the chapters, tables or methods from within the four corners of the AMA guides will provide the most accurate assessment of the injured worker’s impairment. So, the WCAB stated that “[W]e believe that vocational evidence is an important, and often integral, consideration in the preparation of medical-legal reporting, and that is fully within the purview of the evaluating physician to offer an opinion responsive to the vocational evidence either at the request of the parties, or of the physician’s own accord.”
The WCAB then addressed the applicant’s argument that requiring vocational experts to address valid apportionment would result in “pass-through” apportionment; that is, that vocational experts simply would adopt the medical apportionment as their own opinion without properly providing opinions based on vocational factors and evidence as they relate to causation. The WCAB rejected that, stating, “There can be no ‘pass-through’ apportionment from a physician to a vocational expert when that expert is not authorized to render an apportionment determination in the first instance.”
Finally, the WCAB addressed the applicant’s contentions that proscribing vocational apportionment would be “disastrous” and lead to an “implosion of the [workers’ compensation] system.” The WCAB explained that it held only that: (1) an evaluating physician may render an apportionment opinion, and that the opinion must be based on substantial medical evidence; and (2) pursuant to LC 4663, a vocational expert may not substitute other theories of apportionment in an effort to supplant otherwise valid legal apportionment. It explained, “Our Opinion does not require the application of invalid apportionment by the parties or by the WCJ, and in those instances where there is a significant question as to the validity of a physician’s medical apportionment opinion, the vocational expert is free to offer their analysis in the alternative.”
ANALYSIS OF THE DECISION
Nunes II clarifies and perhaps strengthens the WCAB’s original decision. The WCAB makes it clear that apportionment determinations pursuant to LC 4663 must be made by physicians. Vocational experts may not offer a competing or alternate apportionment analysis. When a physician has made a valid apportionment determination, the WCAB stated that an award of permanent total disability may issue “so long as the medical and vocational evidence establishes that the permanent and total disability arises solely out of industrial conditions or factors, that is, exclusive of nonindustrial or prior industrial conditions or factors.” So, if there is a valid medical apportionment determination, both the physician and the vocational expert would be required to report that the permanent total disability resulted entirely from industrial factors for the applicant to receive a 100 percent award.
Nunes II, however, also explains how injured workers may use vocational experts to challenge “valid medical apportionment.” Although apportionment determinations must be made by physicians, an applicant may receive an award of permanent total disability if a physician cannot identify valid apportionment. To that end, injured workers may obtain vocational evidence, which evaluating physicians must consider in assessing the issues of impairment and permanent disability. If, after reviewing a vocational expert’s report, a physician cannot identify valid medical apportionment or concludes that the applicant’s permanent total disability resulted entirely from industrial factors, even with valid apportionment, the applicant could receive a permanent total disability award.
Furthermore, the WCAB explained that injured workers may receive an unapportioned award by showing that a physician’s apportionment opinion is invalid. The WCAB stated that “[I]n those instances where there is a significant question as to the validity of a physician’s medical apportionment opinion, the vocational expert is free to offer their analysis in the alternative.” So, although a vocational expert may not offer an alternative apportionment analysis, he or she may be used to challenge the validity of a physician’s apportionment opinion.
No doubt Nunes I and Nunes II will shape the use of vocational experts going forward. How those cases will be interpreted and applied remains to be seen.
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Attorney of Counsel Michael Sullivan & Associates, LLP.
Mr. Log is a specialist in workers’ compensation defense and related labor law issues. He analyzes files for litigation and settlement, conducts research, reviews records to facilitate completion of discovery and drafts a variety of documents, including trial and appellate briefs. He was instrumental in a 2009 case that ended vocational rehabilitation in California.
Mr. Log prepares seminar material and co-authors white papers on significant topics in workers’ comp law, including “An Analysis of the New Regulations Regarding Disputes Over Medical-Legal Expense and Medical Treatment,” “Special Report: A First Look at SB 863,” about the 2012 legislation’s wide-ranging changes to the state’s workers’ compensation system, and “SB 863: Five Years Later.”
Mr. Log is also Co-Author of “Sullivan on Comp,” a 16-chapter objective analysis of California workers’ compensation law, updated monthly.