LEGISLATIVE ANALYST MEMORANDUM

To: Members of the Board of Supervisors

From: Adam Van de Water, Office of the Legislative Analyst

Date: June 15, 2005

Re: Employee Suggestion: Returning Employees on Worker’s Compensation to Light Duty Work (OLA No. 038-05E)

Employee Suggestion

An employee suggested returning employees out on workers’ compensation to light duty work in order to reduce overtime use/pay, particularly at MUNI and the Department of Child Support Services.

Executive Summary

Some departments of the City have worked to return employees out on workers’ compensation to temporary light duty work as a means of reducing overtime and workers’ compensation costs, speeding recovery for temporarily disabled employees, and/or preventing the despondency and deterioration of basic work skills resulting from prolonged absences from work. For example, most public safety departments – including Police, Fire, Sheriff, Adult Probation, and the District Attorney – have temporary return to work programs, as do the departments of Recreation and Park, Public Health, and MUNI.

In its May 2005 report on Civil Service Reform, the Department of Human Resources recommended creating a citywide temporary return to work program in order to increase the inventory of available temporary assignments beyond the injured employee’s home department.

To the extent that departments are not returning employees to some type of productive work at the earliest medically-approved opportunity, the City may wish to:

• revisit individual policies in departments with a high number of worker’s compensation claims,
• create a standardized, citywide program for their return, and/or
• conduct a more in-depth study of the causes of work-related injuries by department, the success of existing departmental programs to return injured employees to light duty transitional work, and policy options available to the City.

Analysis

A 2004 Controller’s Office draft return to work program for the Juvenile Probation Department found that, "experience and evidence suggest that employees sustaining an occupational injury or illness benefit both psychologically and physiologically from continued functional activity such as occurs with a return to work." Workers’ compensation law¹ and collective bargaining agreements² similarly recognize and work to promote this benefit.

According to the Department of Human Resources’ May 2005 Report "Civil Service Reform", the City of San Francisco "has approximately 4,500 workers’ compensation claims, of which 2,500 involve lost time. Last year, this lost time cost $10 million in temporary disability to miscellaneous employees, $17 million for disability pay for public safety personnel, and an unknown amount in related overtime." As a result, the report recommends creating a citywide program to return injured employees to work more quickly.

Such a program would allow employees to return to temporary work outside of their home department, thereby increasing the available inventory of placements. Issues raised by such a recommendation include:

• the identification of temporary assignments that do not require extensive training,
• the creation of a centralized management program to facilitate work across departments,
• cooperation with labor organizations to allow temporary placements across bargaining units,
• coordination with various provisions in state and local law requiring review by the City Attorney’s Office
• the standardization of budgets and time limits for transitional work (such as whether the home or the host department is charged the cost of the employee’s salary), and
• the creation of a mechanism for periodic evaluation of the continued value to the City of new light duty assignments and/or the creation of a new citywide return to work program.

Several departments – including Police, Fire, Sheriff, Recreation and Park, Adult Probation, Public Health, the District Attorney, and MUNI – already have temporary return to work programs within their own departments. These programs have the advantage of being tailored to the specific job classifications of that department and do not require the level of coordination of a citywide program. In addition, they offer implementation experience to other departments looking to create or revise their own programs.

Recommendation

Returning employees out on workers’ compensation to some type of productive light duty work is a goal shared by employees, managers, the City, workers’ compensation law, and collective bargaining agreements. To the extent that departments are not promoting such a return at the earliest, medically-approved opportunity, the City may wish to:

• create, update, or revise return to work policies in departments that either do not have one or have not recently revisited theirs,
• create a citywide program to facilitate the return of injured employees into a larger inventory of available temporary positions, and/or
• conduct an in-depth study of the available policy options for returning employees to productive and healthy work and reducing the estimated $27 million in annual disability pay.

¹Recent state reform of worker’s compensation law (SB899 effective January 1, 2005), provides a 15% reduction in an employer’s obligation to pay permanent disability (PD) benefits if the employer offers the employee his or her pre-injury job at the same pay or offers a modified or alternative job paying at least 85% of the pre-injury wage for at least one year. If the employer does not offer a suitable return to work job within 60 days from the date the employee’s medical condition becomes "permanent and stationary", the injured worker receives a 15% increase in the PD payment.

²For example, Article III.S of the FY03-06 MOU with IFPTE, Local 21 states that, "the City will make a good faith effort to return and reassign employees who have sustained an occupational injury or illness" and provides for temporary assignment (up to 3 months) in a different class, shift, and/or department at the employee’s regular base rate of pay.