Why the Carve-Out Works When the Comp System Does Not

James Libien, Esq.

Sacramento, California

The California Constitution, Article XIV, Section 4, includes a provision for the "comfort, health and safety and general welfare of any and all workers" and authority to enact legislation that "shall accomplish substantial justice in all cases expeditiously, inexpensively, and without encumbrance of any character." Anyone who works in the California workers’ compensation system knows that this constitutional mandate simply is not followed. Why is this so and how can it be remedied?

If you are a unionized employer in California, the remedy is a carve-out as allowed by Labor Code sections 3201.5 and 3201.7. In a carve-out, the employee’s concerns are considered and addressed. In the statutory system the employer/carrier/TPA does what it has to do to have a successful audit. Also, in a carve-out, the employee participates in the decisions being made concerning their care. In the statutory system, the guidelines dictate the care.