ADJ19199519 · February 18, 2025

SISF steps into the shoes of the insolvent self-insured employer and need not be formally joined as a separate party defendant; denial of joinder was a non-final order and due process required a hearing or notice before denial.

From the decision · page 2While a WCJ is empowered to join additional parties necessary for the full adjudication of the case at any time, [Labor Code § 5307.5(b); Cal. Code Regs., tit. 8, § 10380] the California Self-Insurers' Security Fund, much like the California Insurance Guarantee Association, rather than functioning as a party defendant separate and distinct from the exiting insolvent self-insured employer, steps in the shoes of that employer and assumes its liability, thereby negating the judicial requirement of a formal joinder as a party defendant. In addition, to require its joinder in every case involving a liquidated self-insured employer places an exceptional burden on already overwhelmed limited judicial resources and frustrates its essentially constitutional purpose of providing expeditious delivery and resolution of litigated workers' compensation cases.

SISF, as the statutory successor to the insolvent self-insured employer, is a party in interest and need not be formally joined as a separate party defendant.

Favours Defendant prevailed

Determined that a formal order of joinder is not required for SISF to participate, affecting the procedural posture and remedy.

From the decision · page 2While a WCJ is empowered to join additional parties necessary for the full adjudication of the case at any time, [Labor Code § 5307.5(b); Cal. Code Regs., tit. 8, § 10380] the California Self-Insurers' Security Fund, much like the California Insurance Guarantee Association, rather than functioning as a party defendant separate and distinct from the exiting insolvent self-insured employer, steps in the shoes of that employer and assumes its liability, thereby negating the judicial requirement of a formal joinder as a party defendant. In addition, to require its joinder in every case involving a liquidated self-insured employer places an exceptional burden on already overwhelmed limited judicial resources and frustrates its essentially constitutional purpose of providing expeditious delivery and resolution of litigated workers' compensation cases.

The WCJ denied the petition for joinder without a hearing or notice of intent, and no record supported the denial.

Favours Applicant prevailed

Due process required a hearing or notice before denying joinder; lack thereof required rescission of the order and remand.

From the decision · page 6Here, the WCJ summarily issued an order denying the petition for joinder without issuing a notice of intent and without conducting a hearing on the petition. (Cal. Code Regs., tit. 8, § 10832.) No record supports the order denying joinder; accordingly, due process requires that we grant removal, rescind the order denying joinder, and return this matter to the trial level for further proceedings.

Labor Code §§ 5900(a), 5902, 5903; Rymer v. Hagler (1989) 211 Cal.App.3d 1171; Maranian v. WCAB (2000) 81 Cal.App.4th 1068

A petition for reconsideration may only be taken from a final order; interlocutory procedural or evidentiary decisions are not final orders.

Denial of joinder is a pre-trial, non-final order, so reconsideration is not available; removal is the proper remedy.

From the decision · page 4II. A petition for reconsideration may properly be taken only from a "final" order, decision, or award. (Lab. Code, § 5900(a), 5902, 5903.) A "final" order has been defined as one that either "determines any substantive right or liability of those involved in the case" (Rymer v. Hagler (1989) 211 Cal.App.3d 1171, 1180; Safeway Stores, Inc. v. Workers' Comp. Appeals Bd. (Pointer) (1980) 104 Cal.App.3d 528, 534-535 [45 Cal.Comp.Cases 410]; Kaiser Foundation Hospitals v. Workers' Comp. Appeals Bd. (Kramer) (1978) 82 Cal.App.3d 39, 45 [43 Cal.Comp.Cases 661]) or determines a "threshold" issue that is fundamental to the claim for benefits. (Maranian v. Workers' Comp. Appeals Bd. (2000) 81 Cal.App.4th 1068, 1070, 1075 [65 Cal.Comp.Cases 650].) Interlocutory procedural or evidentiary decisions, entered in the midst of the workers' compensation proceedings, are not considered "final" orders. (Id.

Cal. Code Regs., tit. 8, § 10843(a); Cortez v. WCAB (2006) 136 Cal.App.4th 596; Kleemann v. WCAB (2005) 127 Cal.App.4th 274

Removal is granted only if substantial prejudice or irreparable harm will result and reconsideration is not an adequate remedy.

Removal granted because due process was denied by summary denial of joinder without hearing or notice.

From the decision · page 5shows that substantial prejudice or irreparable harm will result if removal is not granted. (Cal. Code Regs., tit. 8, § 10843(a); see also Cortez, supra; Kleemann, supra.) Also, the petitioner must

Labor Code § 3743

SISF assumes the obligations of an insolvent self-insurer and is a party in interest in all proceedings involving claims against the insolvent employer.

SISF need not be formally joined as a separate party defendant; it steps into the shoes of the insolvent employer.

From the decision · page 5(a) Upon order of the director pursuant to Section 3701.5, the fund shall assume the workers' compensation obligations of an insolvent self-insurer. (b) Notwithstanding subdivision (a), the fund shall not be liable for the payment of any penalties assessed for any act or omission on the part of any person other than the fund, including, but not limited to, the penalties provided in Section 132a, 3706, 4553, 4554, 4556, 4557, 4558, 4601.5, 5814, or 5814.1. (c) The fund shall be a party in interest in all proceedings involving compensation claims against an insolvent self-insurer whose compensation obligations have been paid or assumed by the fund. The fund shall have the same rights and defenses as the insolvent self-insurer, including, but not limited to, all of the following: (1) To appear, defend, and appeal claims. (2) To receive notice of, investigate, adjust, compromise, settle, and pay claims. (3) To investigate, handle, and deny claims.

No record supported the order denying joinder; no hearing or notice of intent was provided before denial.

From the decision · page 6Here, the WCJ summarily issued an order denying the petition for joinder without issuing a notice of intent and without conducting a hearing on the petition. (Cal. Code Regs., tit. 8, § 10832.) No record supports the order denying joinder; accordingly, due process requires that we grant removal, rescind the order denying joinder, and return this matter to the trial level for further proceedings.