Earlier this year, California lawmakers passed Senate Bill 788 (SB-788)—reform legislation that would, among other things, prohibit “discrimination on the basis of sex, gender identity, and sexual orientation” in the determination for permanent disability ratings. If enacted, the law would have had significant implications for workers’ compensation claims. However, the legislation has been vetoed. In this article, our Fresno workers’ compensation defense lawyers provide an overview of Governor Gavin Newsom’s veto of SB 788.

Gavin Newsom Vetoes Senate Bill 788

On September 28, 2021, the Office of the Governor returned Senate Bill 788 to the legislature without a signature. In effect, this means that Governor Gavin Newsom vetoed the proposed law, which was passed by both the California State Assembly and the California State Senate earlier this year. In the official statement vetoing the bills, Governor Newsom expressed his support for eliminating bias, but also noted his concerns that the bills were duplicative of current regulations and would have raised the costs associated with administering workers’ compensation claims.

Justification: Law Would Have Made Workers’ Compensation Administration More Expensive

From the broadest perspective, the costs involved with administering workers’ compensation claims in California are borne by all parties—including employers and employees. In returning the workers’ compensation reform bill without a signature, Governor Newsom was especially concerned with the costs related with the proposed reforms. Here is a basic overview of what the bill would have done and why so many people were worried that it would increase workers’ compensation administration costs:

  • The Goal: SB 788 would have expressly prohibited the use of discriminatory reasoning based on sex, gender, sexual orientation, or gender identity in the determination of disability ratings. As disability ratings are a key part of many workers’ compensation claims, SB 788 would have had significant implications for employees, employers, and claims administrators.
  • The Objections: Governor Newsom’s stated objections to SB 788 were twofold. First, he notes that the bill is largely duplicative of existing regulations in California. There is existing law in place that bars discrimination in the determination of disability ratings. Second, the Governor expressed concerns that SB 788 would have increased compliance and administration costs. The official statement vetoing the bill noted that the law “is likely to result in increased litigation and subsequent delays to much-needed benefits to workers.”

Unless lawmakers have sufficient support to override the Governor’s veto, SB 788 will not take effect. Of course, the law could potentially come back in a revised or similar form in a future legislative session.

Get Help With a Fresno, CA Workers’ Compensation Defense Lawyer Today

At Yrulegui & Roberts, we provide results-centered workers’ compensation defense representation. Clients deserve personalized guidance and support from their attorney. Contact us now for your confidential initial consultation. Our law firm is well-positioned to serve WCAB locations throughout the region, including Fresno, Bakersfield, Sacramento, Stockton, Redding, San Jose, Salinas, San Luis Obispo, Santa Barbara, Oxnard, and Van Nuys.