In August 2002, correctional officer Michael Ayala was severely injured on the job after being attacked by inmates. As a result of his injuries, Mr. Ayala was 85% permanently disabled. He subsequently filed a workers’ compensation claim and alleged that the injury was caused by the “serious and willful misconduct” of his employer, the California Department of Corrections and Rehabilitation (CDCR). If Ayala were able to show that his injuries were caused by “serious and willful misconduct”, Labor Code Section 4553 provides that “[t]he amount of compensation otherwise recoverable shall be increased one-half…”
Ayala ultimately proved that CDCR was guilty of serious and willful misconduct, and thus he was entitled to the additional one-half increase in recovery compensation. But, the parties disagreed as to what qualified as “the amount of compensation otherwise recoverable,” aka the “base compensation.” Ayala argued that for the period before his permanent disability, his base compensation was his full salary, which he received because he was on industrial disability leave and enhanced industrial disability leave. CDCR argued that industrial disability leave benefits are not “compensation” under this statute, and Ayala was only entitled to what he would have earned on temporary total disability (which would have equated to roughly 2/3 of his total salary).
The California Court of Appeal agreed with CDCR and found that industrial disability leave and enhanced industrial disability leave benefits are not “compensation” as that term is used in Labor Code Section 4553. They noted that Section 4553 is part of Division 4 of the Labor Code. Earlier in that same Division, at section 3207, the definition of “compensation” is limited to what is provided by or conferred “by this division.” But, industrial disability leave benefits are not conferred in the Labor Code. Rather, those benefits are supplied by Government Code Section 19871. The court found that “compensation” as defined under Labor Code Section 4553 did not include industrial disability leave benefits. Ayala was consequently provided compensation pursuant to what he would have earned on temporary total disability.
Department of Corrections and Rehabilitation v. WCAB (Ayala), 2023 Cal.App. LEXIS 615.