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s 15403.1. Notice of Special Audit.
When in the discretion of the Manager, a special audit as defined in Section 15201 of these regulations is necessary, the Manager shall notify the self-insurer of the requirement in writing fourteen (14) calendar days prior to the special audit and give the reasons therefor.
Note: Authority cited: Sections 54, 55, 59 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3702.10, 3703, 3704 and 3705, Labor Code.
s 15403.2. Financial Information.
Note: Authority cited: Sections 54, 55 and 3702.10 Labor Code. Reference: Sections 59, 129, 3700, 3701 and 3702.10, Labor Code .
s 15404. Expense of Out-of-State Audit.
The audit of any self insurer, pursuant to Section 15403 of these regulations, at locations outside of the State of California, shall be at the expense of the self-insurer. The Manager shall bill the self insurer for the expense incurred in making such out-of-state audit.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3702.6 and 3702.10, Labor Code.
s 15404.1. Expense of Revoked Certificate Audit.
A self-insurer whose certificate to self insure has been revoked shall pay expenses incurred by the Director or his representative in conducting an audit pursuant to Section 15425 of these regulations. The Manager shall bill the self insurer for expenses incurred.
Note: Authority cited: Sections 54, 55 and 3702.10 Labor Code. Reference: Sections 59, 129, 3702.6 and 3702.10, Labor Code.
s 15404.2. Expense of Special Audit.
A self-insurer shall pay the expenses incurred whenever a special audit as defined in Section 15201, of these regulations, is ordered by the Manager pursuant to Sections 15403, 15404 and 15404.1 of these regulations. The Manager shall bill the self insurer for expenses incurred.
Note: Authority cited: Sections 54, 55 and 59, Labor Code. Reference: Sections 59, 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703, 3704 and 3705, 3702.6 and 3702.10, Labor Code.
s 15405. Confidentiality.
(a) Financial information submitted to the Director or Manager to establish the solvency and worth of any self insurer, applicant to be self insured, third party administrator, or of a guarantor of a self insurer or applicant to be self insured shall be considered confidential in accordance with Government Code Sections 6254 and 6255.
(b) Information obtained from any audit regarding the nature, extent or financial liability of any specific self insurer's workers' compensation claims, together with any and all like information regarding a specific self insurer's claims or financial condition, shall be confidential and shall be used solely for the purpose of applying the provisions of these regulations.
(c) The list of open claims and list of claims reported to excess insurance carriers in the Self Insurers Annual Report and any claims logs submitted to the Manager shall be confidential.
(d) The Manager shall disclose any financial or claims information to the Self Insurers' Security Fund on any private self insurer whose liabilities have been turned over to the Fund pursuant to Labor Code Section 3742 et seq. The Manager shall also disclose any financial information to the Self Insurers' Security Fund on any private self insurer who has filed bankruptcy, been unable to pay their liabilities, or failed to post an increase in deposit due that would potentially put the Fund in jeopardy for the self insurer's liabilities.
(e) At the written request of the Chief of the Division of Workers' Compensation, Office of Benefits and Enforcement, the Manager shall provide a copy of any audit report to the Division of Workers' Compensation. The self insured employer and/or administrator shall be notified of the release of the audit report to the Division of Workers' Compensation.
(f) Subject to the described conditions, the financial and audit information shall not be disclosed to any other department, entity or person without an order from an appropriate court or administrative subpoena from an agency of the State. The self- insured entity shall be promptly advised of the court order or subpoena by the Manager.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 129, 3700, 3702.6 and 3702.10, Labor Code.
s 15406. Confidentiality.
Note: Authority cited: Sections 54, 55, and 3702, Labor Code . Reference: Sections 159, 3700, 3702.5 and 3702.10, Labor Code.
s 15420. Compliance with Statutes and Regulatory Requirements.
Self-insured employers and their administrative agencies shall comply with applicable regulations governing the administration of self-insurance pursuant to Labor Code Sections 129, and 3700-3709.5, which are adopted in accordance with the provisions of the California Administrative Procedure Act (Government Code, Title 2, Division 3, Part 1, Chapters 3.5 [commencing with Section 11340]). Failure to comply with these statutes governing administration of self insurance or with these regulations may be good cause for revocation of a Certificate to Self Insure or Certificate to Administer or other action by the Director.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.5, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15421. Safety Violations.
Note: Authority Cited: Sections 55 and 3702.10, Labor Code. Reference: Sections 54, 55 and 3702.10, Labor Code.
s 15422. Voluntary Revocation.
Any self-insurer or administrative agency may voluntarily request that its Certificate to Self Insure or Certificate to Administer be revoked at any time by informing the Manager in writing. The Director shall revoke the Certificate to Self Insure or Certificate to Administer after the self-insurer or administrative agency has:
(a) Shown to the satisfaction of the Director that the self-insurer or administrative agency has established a program to discharge all liabilities and all responsibilities incurred by the self-insurer or administrator during the period the Certificate to Self Insure or Certificate to Administer was in force; and
(b) Surrendered the Certificate to Self Insure or Certificate to Administer.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.5. 3702.6, 3703, 3705, 3740-3745, Labor Code.
s 15423. Revocation.
Revocation for Cause. Proceedings to revoke a Certificate to Self Insure or Certificate to Administer for good cause as defined in Labor Code Section 3702 and in these regulations shall be after Notice of Intent and opportunity for a hearing in accordance with Article 11 of these regulations. The Notice of Intention to Revoke a Certificate to Self Insure or Certificate to Administer shall include a clear description of cause for revocation.
Note: Authority Cited: Sections 54, 55, 59, 129, 3700, 3700(b), 3701, 3701.5, 3702, 3702.5, 3702.6, 3703, 3705, 3740-3745, Labor Code. Reference: Sections 129, 3700, 3700(b), 3701, 3702, 3702.5, 3702.6, 3703 and 3705, Labor Code.
s 15424. Revoked Certificate Report.
The Director shall require a former self-insurer whose certificate to self insure has been revoked to continue to submit self-insurer's annual reports pursuant to Section 15251 of these regulations, setting forth the status of all open work-injury claims until all claims are resolved.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15425. Revoked Certificate Audit.
Pursuant to Sections 15403 and 15427 of these regulations, the Manager shall continue to audit the work-injury cases of any former self-insurer whose certificate to self insure has been revoked.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15426. Release of Security Deposit.
(a) Upon any revocation of a private employer's certificate to self-insure, a new deposit level shall be determined by the Managerto be sufficient to secure all actual and potential liabilities. The former self insurer shall continue to be responsible to increase the deposit at the written request of the Manager as required in Section 15210 of these regulations.
(b) Except as provided in Labor Code Section 3702.8(c), the deposit shall not be reduced below the statutory minimum pursuant to Labor Code Section 3701.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15427. Continuing Jurisdiction.
After revocation of a certificate to self insure, the Director's jurisdiction over work injuries sustained during the period of self-insurance shall continue until all liabilities and all responsibilities have been terminated in accordance with law.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15428. Administration of Claims After Revocation.
(a) A private sector self insurer whose certificate to self insure has been revoked shall continue to provide competent administration of workers' compensation claims incurred during the period of self insurance in accordance with Sections 15450-15463 of these regulations, and the claims shall be administered from within the State of California.
(b) If it is determined by the Manager that the claims are not being competently administered, the Manager shall arrange for the claims administration. The cost of administration shall be borne by the former self insurer.
Note: Authority Cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 54, 55, 59, 129, 3700, 3701, 3701.5, 3702, 3702.3, 3702.6, 3702.10, 3703, 3705, 3740-3745, Labor Code.
s 15430. Hearing.
The Director may initiate an investigation or hold a hearing to implement the law and regulations with respect to the following self insurance matters:
(a) Disputes specified in Labor Code section 3701.5(g) arising between or among a surety, the issuer of an agreement of assumption and guarantee of workers' compensation liabilities, the issuer of a letter of credit, any custodian of the security deposit, a self-insured employer, or the Self-Insurers' Security Fund;
(b) Disputes between any self-insurer and the Manager involving action by the Manager to involuntarily revoke an existing certificate for cause pursuant to Labor Code section 3702;
(c) Disputes involving action by the Manager to revoke or deny issuance of a certificate to administer pursuant to Labor Code sections 3702.1 and 3702.7;
(d) An appeal by a private sector self-insurer concerning the amount of the security deposit to be posted pursuant to Labor Code section 3701(b) or section 15210 of these regulations;
(e) An appeal by any self-insurer concerning any civil penalty assessment made pursuant to Labor Code section 3702.9;
(f) The appeal of an employer alleging its application for a certificate or by an administrator that its application for a certificate to administer has not been processed in a timely manner;
(g) To determine whether good cause exists to revoke any self-insurers' certificate for willful or repeat serious violations of occupational safety and health regulations as noted in Cal/OSHA citations issued by the Division of Occupational Safety and Health;
(h) An appeal by a private self insurer concerning the calculation, posting, or any other aspect of its deposit assessment after payment of the deposit assessment in the time provided to the Security Fund, and;
(i) An appeal by a private self insurer of any civil penalty assessed for failure to pay a deposit assessment to the Security Fund.
Note: Authority cited: Sections 54, 55, 3701.8 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3701.8, 3702, 3702.1, 3702.5, 3702.6, 3702.7. 3702.9, 3705, and 3740- 3747, Labor Code. Sections 11181-11188, 15378, Government Code.
s 15430.1. Definitions.
As used in article 11, the following definitions shall apply.
Aggrieved Party. Any person aggrieved as a result of person the failure to pass a Self Insurance Administrator examination pursuant to Labor Code section 3702.1(b) or the revocation of a certificate to administer pursuant to Labor Code sections 3702.1(a) or 3702.7 and as prescribed in article 12 of these regulations.
Appeals Board. A California Workers' Compensation Appeal a Board.
Certificate. See section 15201 for definition.
Certificate to Administer. A Certificate of Consent to Administer issued to an administrative agency, except exempt insurance carrier, pursuant to section 3702.1 of the Labor Code.
Custodian of a Security Deposit. The Office of the State Treasurer for cash deposits and approved securities; the Manager of Self-Insurance Plans for surety bonds and letters of credit.
Employer. Any private corporation or other private business entity or public agency as defined in Labor Code section 3300 that has or did have a Certificate of Consent to Self-Insure or any such private entity or public agency seeking a Certificate of Consent to Self Insure pursuant to Labor Code sections 3700 and 3701.
Letter of Credit, Maker of. Any financial institution providing an irrevocable letter of credit to a self-insured employer pursuant to Labor Code section 3701.
SISF. Self-Insurers' Security Fund (SISF), a nonprofit entity created pursuant to Labor Code section 3740 et seq.
Surety. Any corporation authorized to provide surety in the State of California and providing a surety bond to a self-insured employer pursuant to Labor Code section 3701.
Note: Authority cited: Sections 54, 55, and 3702.10, Labor Code. Reference: Sections 3300, 3700, 3701, 3701.5, 3702.1, 3702.7, 3740-3747, Labor Code; Sections 11181-11188, Government Code.
s 15431. Delegation of Authority.
(a) The Manager of Self-Insurance Plans is the authorized representative of the Director. The Manager is authorized to:
(1) Issue notice of intention to revoke a certificate and to deny a request for a certificate or a certificate to administer;.
(2) Receive requests for a hearing by parties enumerated in section 15430 of these regulations;
(3) Schedule hearings;
(4) Perform all administrative duties as required to conduct a hearing, including granting of extensions of time requested in writing upon a showing of good cause;
(5) Hear and determine an appeal by any party aggrieved by the result of the self-insurance administrator examination; and
(6) Hear and determine an appeal regarding the revocation of a certificate to administer prescribed in article 12 of these regulations.
(b) In all other hearings and appeals the Director or hearing officer shall perform all functions necessary to conduct a hearing.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.7, 3702.10, and 3740-3747, Labor Code; Sections 11181-11188, 15378, Government Code.
s 15431.1. Appeals and/or Requests for Hearings.
(a) Appeals and/or requests for hearing under this article, by an employer or aggrieved party shall be in writing and shall include the following information:
(1) Name and address of the person making the appeal or requesting the hearing (i.e. the requesting party):
(2) The specific nature of the request (for example, "This request is to review action denying revoking a certificate to administer"; or "This request is to appeal the failure to pass the self-insurance administrator's examination");
(3) A statement of the requesting party's rationale, basis, evidence, facts, reasoning, arguments, documentation, or other supporting material which establishes's and supports the position of the requesting party:
(4) A statement of whether the requesting party wishes a formal hearing or a written decision only on the matter;
(5) When a formal hearing is requested, an additional statement estimating the number of witnesses, if any, to be called by the requesting party at the hearing and the amount of time the requesting party will require to present its case at the hearing.
(b) Requests for a hearing or appeal pursuant to Section 15430 of these regulations shall be mailed or delivered to: Manager, Self-Insurance Plans, 2265 Watt Avenue, Suite 1, Sacramento, CA 95825.
(c) An appeal or request for a hearing from an employer or aggrieved party must be served upon the Director in writing within twenty-one (21) calendar days after receipt of:
(1) Notice of intention to revoke or deny a certificate to self-insure;
(2) Notice of the default of a self-insured employer or surety;
(3) Notice of a failing score on the self-insurance administrator's examination;
(4) Notice of intent to revoke a certificate to administer; or
(5) The decision by the Manager not to renew or grant a certificate to administer.
(d) A hearing on a claim that Self-Insurance Plans has not timely processed an application as required by Government Code section 15378 may be requested at any time.
(e) An appeal or request for hearing shall be deemed timely received if the request is postmarked or delivered to the Director or the Manager by the end of business on the twenty second (22nd) calendar day, after receipt of the notice or decision being appealed, as set forth in subsection (c) of this section.
(f) The written appeal or hearing request shall be:
(1) Placed in the United States mail in a fully prepaid, postmarked and sealed envelope;
(2) Delivery to an overnight mail delivery service for delivery the following day; or
(3) Delivery by messenger or in person to the Office of Self-Insurance Plans.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.7, 3702.9, 3702.10 and 3740-3747, Labor Code; Sections 11181-11188 and 15378, Government Code.
s 15431.2. Complaints.
(a) Any self-insured employer, administrator, the Self-Insurers' Security Fund, or injured employee of a self-insured employer may file a complaint to the manager in writing concerning the failure of any self-insured employer or administrator to provide timely payment of benefits due or to fund the payment of such benefits.
(b) The Manager shall review any complaints received and may investigate the complaint, determine what benefits may be due and order payment thereof, audit the claim records of the self-insurer or administrator, and take action to revoke the certificate or certificate to administer for cause.
(c) The Manager shall not seek to substitute his/her judgement for that of the Workers' Compensation Appeals Board on any adjudicated claim and may refuse to consider the complaint of any injured worker's entitlement to benefit or self-insurer where the matter involved in the complaint is waiting the decision of the Appeals Board.
(d) Any written complaint shall include the following information:
(1) The basis of jurisdiction of the Director;
(2) The relief or action requested;
(3) The grounds for the requested relief or action;
(4) The facts involved in the complaint;
(5) A statement of whether or not the specific claim or claims is being adjudicated before the Workers' Compensation Appeals Board and the Appeal number of the claim before the Appeals Board; and
(6) The name of the parties known to the complainant against which any relief is sought or who have an interest in the proceeding. The complaint shall be served on these other persons who may have interest in the proceedings by the person submitting the complaint.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.7, 3702.9, 3702.10 and 3740-3747, Labor Code; Sections 11181-11188 and 15378, Government Code.
s 15432. Hearings; Special Requirements: Failure to Appear.
(a) Before seeking reconsideration by the Director an appeal shall be first made to the Manager in matters of:
(1) A failing score on any self-insurance administrator's examination; or
(2) The revocation of a certificate to administer or denial of a renewal of a certificate to administer.
(b) A written waiver of review by the manager shall constitute satisfaction of section 15432(a) and allow immediate reconsideration by the Director in the matter.
(c) The SISF shall have thirty (30) days to contest a decision by the Director to require it to assume administration on behalf of a defaulting self-insured employer. The SISF shall not be required to bring a complaint action under section 15431.2 of these regulations within any specific time against a defaulting self-insurer, surety, custodian of securities or maker of a letter of credit after assuming the liabilities of responsible parties under Labor Code sections 3743-3744. Nothing in this subsection shall be construed as to allow SISF to withhold or delay payments in any event.
(d) Failure to Appear.
(1) If after service of notice of hearing or continuance, a party fails to appear at the hearing either in person or by representative, the Director or the designated hearing officer may:
(A) Continue the proceeding; or
(B) After notice, dismiss the proceeding as a default and uphold the action appealed from, if the non-appearing party is the party requesting the hearing;
(C) Receive evidence, including admission, affidavit, or declarations of the party, establish a prima facie case and render a decision
(2) A party who has defaulted, and against whom a decision or determination is upheld, nevertheless has the right to make a showing by way of mitigation as to any remedy. The Director may consider documentary evidence or hold a hearing, and may decide to alter the remedy, both in the discretion of the Director.
Note: Authority cited: Sections 54, 55 and 3702.10 Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1. 3702.5, 3702.6, 3702.7. 3702.9, 3702.10. 3705, 3740-3747, Labor Code; Sections 11181-11188 and 15378, Government Code.
s 15433. Hearing Officer: Appointment and Delegation of Authority.
(a) The Director may appoint a hearing officer. The appointed hearing officer shall have full power, jurisdiction and authority to:
(1) Hold a hearing and ascertain facts for the information of the Director;
(2) Hold a pre-hearing conference and/or to a certify official acts;
(3) Regulate the course of the hearing;
(4) Join and dismiss parties in a complaint proceeding pursuant to section 15431.2 of these regulations;
(5) Grant a withdrawal, disposition or amendment;
(6) Order a continuance or to extend the submittal date of the proceeding;
(7) Approve a stipulation voluntarily entered into by the parties;
(8) Administer oaths and affirmations;
(9) Rule on objections, privileges, defenses, and the receipt of relevant and material evidence;
(10) Request a party at any time to state his theory concerning any fact or issue in the proceeding.
(11) Hear and determine all issues of fact and law presented; and
(12) Issue interlocutory and final orders, findings and decisions as may be necessary for full adjudication of the matter.
(b) The hearing officer may issue subpoenas and subpoenas duces tecum in the name of the Director for the attendance of persons and the production of testimony, books, documents, or other things, to compel attendance of persons residing anywhere within the state, subject to the provisions of Government Code section 11185.
(c) For purposes of an appeal or hearing to be heard by the Manager, the Manager shall exercise the power of a designated hearing officer.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.9, 3702.10, 3705, and 3740-3747, Labor Code; Sections 11181-11188, 15378, Government Code; Sections 1985-2031, 2033-2036, Code of Civil Procedure.
s 15434. Hearing Procedures.
(a) The affected employer, surety, any custodian of a surety deposit, maker of a letter of credit, the SISF, an aggrieved party, and any other affected parties or persons shall be notified of the time and place of the hearing by a notice issued by the Director, designated hearing officer or the Manager and such notice to be served on all parties.
(b) Notification shall be placed in the U.S. mail in a fully prepaid, postmarked and sealed envelope at least twenty-one (21) calendar days in advance of the hearing. Without good cause being shown and a written request for extended time to respond, the time to respond shall not be extended beyond the twenty-one (21) days by California Code of Civil Procedure section 1013.
(c) The employer, surety, custodian of a security deposit, maker of a letter of credit, the SISF, an aggrieved party, and any other party, shall be given an opportunity to present evidence and/or written or oral arguments in support of its position.
(d) The hearing need not be conducted according to the technical rules of evidence. In the interest of expeditious and inexpensive adjudication, evidence by way of affidavit or declaration shall be allowed under the following conditions:
(1) At any time fifteen (15) days or more prior to the hearing date or continued hearing date, a party may mail or deliver to the opposing party or parties, a copy of any affidavit or declaration which is proposed to be introduced in evidence, together with a notice as provided in subsection (2). Unless an opposing party, within ten (10) days after such mailing or delivery, mails or delivers to the proponent a request to cross-examine the affiant or declarant, his right to cross-examine such affiant or declarant is waived and the affidavit or declaration, if introduced into evidence, shall be given the same effect as if the affiant or declarant has testified orally. If an opportunity to cross-examine an affiant or declarant is not afforded after request therefore is made as herein provided, the affidavit or declaration may be introduced into evidence, but shall be given only the same effect as other hearsay evidence.
(2) The notice referred to in subsection (1) shall be substantially in the following form:
"The accompanying affidavit or declaration of (here insert name of affiant or declarant) will be introduced as evidence at the hearing in (here insert title and docket number of proceeding). (Here insert name) will not be called to testify orally and you will not be entitled to question him unless you notify (name of the proponent, representative, agent or attorney) at (here insert address) that you wish to cross-examine him. To be effective, your request must be mailed or delivered to (here insert name of proponent, representative, agent or attorney) on or before (here insert date ten (10) days after the date of mailing or delivering the affidavit or declaration to the opposing party)."
(e) All witnesses testifying before the hearing officer shall testify under oath, affirmation or penalty of perjury.
(f) Upon written request to the Director and for good cause shown, an aggrieved party may request the production of his or her own test and application records from Self-Insurance Plans. At the time of hearing or, upon written request to the Director and for good cause, an aggrieved party may request inspection of his/her own test records prior to the time of hearing.
(g) Discovery. The parties shall have the right to take depositions and to obtain discovery and to that end may exercise all of the same rights, remedies, and procedures, and shall be subject to all of the same duties, liabilities and obligations as provided in part 4, Title 3, chapter 3, of the Code of Civil Procedure, except that applications to the court or requests for relief from the court shall be considered as applications or requests of the hearing officer. All discovery shall be completed not less than fifteen (15) days prior to the date set for hearing, unless the Director, upon a showing of good cause, makes an order granting an extension of the time within which discovery must be completed. The hearing officer shall not have authority to impose monetary sanctions.
(h) Subpoena of Witnesses: Subpoena Duces Tecum
Subject to the provisions of Title 2, division 2, part 1, chapter 2, of the Government Code and before the hearing has commenced, the Director shall issue a subpoena and subpoena duces tecum at the request of a party for attendance of a person or production of a document, object or thing determined to be reasonably relevant, to the issues to be decided at the hearing.
After the hearing has commenced, the Director may issue a subpoena and subpoena duces tecum as follows:
(1) The subpoenaing party shall prepare the affidavit of good cause required by section 1985 of the Code of Civil Procedure before a subpoena duces tecum will be issued.
(2) A subpoenaing party shall comply with section 1985.3 of the Code of Civil Procedure. A person not a party to the matter, is not obliged to attend as a witness in any matter under this article at a place out of the county in which he resides, unless the distance is less than fifty (50) miles from his place of residence. A party or party-identified witness may be obliged to attend a deposition in like manner as in Code of Civil Procedures section 2025.
(i) The hearing shall be recorded by audio recorder. Parties wishing a written transcript shall pay the cost of a transcription or may provide a certified reporter at the time of hearing. A copy of the recorded proceedings shall be provided to the Director if reconsideration is requested.
(j) The Director may appoint an interpreter and fix the interpreter's compensation in any matter where an interpreter is requested by the parties or determined to be needed by the Director or his/her designee. It shall be the responsibility of any party producing a witness requiring an interpreter to arrange for the presence of a qualified interpreter. Interpreter fees are to be paid by the party requesting the use of the interpreter. It shall be the responsibility of the party seeking to use an interpreter to show that the interpreter is proficient in the appropriate language and has sufficient knowledge relating to the terminology and procedures generally used in hearings before the Director to function satisfactorily. The Director may disqualify an interpreter due to conflict of interest, bias, prejudice, partiality or for disclosure of confidential or privileged information.
(k) A request for intervention may be allowed by the Director or designated hearing officer in like matter as in California Code of Civil Procedure section 387.
( l) In the interests of the expeditious resolution of al disputes, the Director may allow time for settlement of disputes. The Director shall approve settlement of any dispute regarding a third-party administrator examination, a revocation of a third-party certificate or certificate of consent to self-insure. The Director, in his discretion, may approve resolution of disputes involving the Self-Insurers' Security Fund. Approval by the Director of disputes, involving SISF is necessary only after a formal hearing on the merits has begun.
(m) An official address record shall be maintained by the Director or the designated hearing officer. Each party shall furnish one address and one telephone number, for itself or it's representative, to which all communications by the Director and other parties shall be directed. If the address is a Post Office Box, a physical address shall also be provided for use when physical delivery other than by mail is intended. All communications by the Director or hearing officer, including all notices and decisions and determinations, shall be made to the addresses on the official address record. Service of anything required to be served shall be acceptable if mailed by registered or certified mail, with return receipt, if mailed to the official address. Legal service may also be made by personal delivery to the official address.
(n) No party or representative of a party shall communicate with a hearing officer on the merits of a matter except in the presence of the other parties or their representatives. No written communication shall be directed to a hearing officer or the Director unless it shows on the face of it or on an attached proof of service that the communication has been simultaneously served on other parties. No written communications in violation of this rule shall be received by the hearing officer or Director. The Director, after a hearing officer has been designated and while the hearing officer is continuing to act on the case, shall not communicate with the hearing officer about the merits of the matter before the hearing officer.
(o) Foundation Evidence. Evidence of the genuineness of any document, and of the authenticity of records, shall be by affidavit or declaration only, unless good cause is shown by a party for the necessity for testimony in the presence of the hearing officer. At the discretion of the hearing officer, any other evidence of a foundational nature shall also be by declaration or affidavit, except where good cause is shown why it should be otherwise.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.9, 3702.10, 3705, 3740-3747; Labor Code; Sections 11181-11188, 15378, Government Code; Sections 1985-2031, 2033-2036, Code of Civil Procedure.
s 15435. Decision.
(a) The hearing officer shall conduct the hearing and provide a written recommendation to the Director and make available the entire record of the hearing. A matter is deemed submitted to the Director either at the close of the hearing, or, at the discretion of the hearing officer, upon the submission of any post-hearing briefs or arguments requested or allowed by the hearing officer.
(b) The decision of the Director shall reflect a summary of evidence, findings of fact and conclusions of law, together with citations to the controlling statutes applied in rendering the decision, and any determinations made by the Director.
(c) The decision shall be mailed within ninety (90) days of the date of submission, with copies of all parties of record. Issuance of a decision may be delayed to allow settlement, or as the interests of justice may require, in which case the Director shall give all parties of record written notice of such delay.
(d) The Director shall make determinations, as required, as to whether there was at the time of the notice of intention or at the time of the decision, good cause to revoke or deny a certificate or certificate to administer.
(e) If the Director determines that an appellant's application was not processed within the time limits which the Director has adopted in these Regulations pursuant to Government Code section 15378, the decision shall include a refund of the fees paid by that appellant for that application.
(f) The decision of the Director shall be final, unless reconsideration pursuant to section 15436 of these regulations is requested.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.9, 3702.10, 3705, 3740-3747, Labor Code; Sections 11181-11188, 15378, Government Code; Sections 1985-2031, 2033-2036, Code of Civil Procedures.
s 15436. Reconsideration.
(a) The Director has the discretion to reconsider and take whatever action is appropriate and necessary to support and facilitate a decision or determination. The Director, in his/her discretion, may grant a stay of enforcement in any proceeding where reconsideration or appeal is initiated.
(b) The employer, surety, custodian of a security deposit, the SISF, or an aggrieved party, upon receipt of the decision, shall have ten (10) calendar days to request reconsideration of the decision by the Director. The request must be in writing and shall be limited to the grounds specified in Labor Code section 5903.
(c) Upon receipt of a request for reconsideration, the Director may:
(1) Decline reconsideration;
(2) Grant reconsideration and issue an amended decision or determination after reconsideration based only upon the record and additional argument and evidence offered in the request for reconsideration and any response thereto; or,
(3) If the Director deems that, based upon the request for reconsideration and any response, further hearing is merited, grant reconsideration and hold further hearing pursuant to these regulations, and issue a decision or determination after reconsideration.
(d) A decision or determination of the Director, where reconsideration by the Director has been requested but not granted, becomes final upon service of the notice that reconsideration is declined. A decision or determination of the Director where reconsideration by the Director has been granted, becomes final upon service of the decision or determination after reconsideration.
(e) All requests for reconsideration by the Director shall be served on all other parties of record by the requesting party at the time of service on the Director. The Director shall not accept requests for reconsideration without a declaration of service attached indicating that all other parties to the matter, as reflected on the official address record, have been served with the request for reconsideration.
(f) If a party to a proceeding is adversely affected for the first time by the decision or determination after reconsideration, that party may then request further reconsideration of the original decision or determination after reconsideration.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.9, 3702.10, 3705, 3740-3747, Labor Code; Sections 11181-11188, 15378, Government Code; Sections 1985-2031, 2033-2036, Code of Civil Procedure.
s 15437. Appellate Review.
(a) Appeal from an adverse decision of the Director with regard to failure to pass the Self-Insurance Administrator examination or revocation of a Certificate to Administer, or with regard to the Office of Self Insurance Plans' timeliness of processing an application, shall be made to the Superior Court of California by writ as provided in the Code of Civil Procedure. A condition precedent to such appeal shall be exhaustion of all appeal requirements specified in this article.
(b) Appeal from a decision or determination of the Director after hearing arising from a dispute between or among a surety, the issuer of an agreement of assumption and guarantee of workers' compensation liabilities, the issuer of a letter of credit, a custodian of a security deposit, an employer, or the SISF, concerning the posting, renewal, termination, exoneration, or return of all or any portion of the security deposit, or any liability arising out of the posting or failure to post security, or adequacy of the security or reasonableness of administrative costs, including legal fees, may be taken to the Superior Court, as provided in Labor Code section 3701.5(g).
(c) Appeal from a determination of the Director after hearing in a proceeding under Labor Code section 3702.8 involving private employers who have ceased to be self-insured employers may be taken to the Appeals Board. After January 1, 1991 such appeals shall be taken to the appropriate Superior Court by petition for writ of mandate.
(d) Appeal from a decision or determination of the Director after hearing which denies an application for a certificate or which revokes a certificate pursuant to Labor Code section 3702(b), may be taken to the Appeals Board. It shall be a condition precedent to the filing of such an appeal that the appealing employer shall have first obtained workers' compensation insurance. A Certificate of Insurance showing the current existence of such insurance, issued by the insurer, shall be filed as part of the appeal.
(e) Appeal of any other determination of the Director may be taken to the Appeals Board.
(f) All appeals to the Appeals Board under this section shall be governed by article 1 of chapter 7 of part 4 of division 4 of the Labor Code, Reconsideration. Appeals shall be filed with the Appeals Board within twenty (20) days after service of the final decision or determination of the Director. Where service is by mail, the time to file shall be extended as provided in Code of Civil Procedure section 1013.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.8, 3702.9, 3702.10, 3705, 3740-3747, Labor Code; Sections 11181-11188, 15378, Government Code; Sections 1985-2031, 2033-2036, Code of Civil Procedure.
s 15438. Severability.
If any provisions of these regulations or the application thereof to any party or circumstances is held invalid, such invalidity shall not affect other provisions or applications of these regulations which can be given effect without the invalid provision or applications and to this end the provisions of the regulations are severable.
Note: Authority cited: Sections 54, 55 and 3702.10, Labor Code. Reference: Sections 59, 3700, 3701, 3701.5, 3702, 3702.1, 3702.5, 3702.6, 3702.7, 3702.9, 3702.10, 3705 and 3740-3747, Labor Code; Sections 11181-11188 and 15378, Government Code; Sections 1985-2031 and 2033-2036, Code of Civil Procedure.
s 15450. Certificate to Administer.
(a) A valid Certificate to Administer issued by the Manager shall be in the possession of each claims administrator, whether a person, firm, corporation, joint powers authority or self insured employer, to administer or adjust workers' compensation self insurance claims.
EXCEPTION1:An insurer admitted to transact workers' compensation insurance in California is exempt from this requirement pursuant to Labor Code Section 3702.1(a);
NOTE:An insurance company subsidiary not admitted to transact workers' compensation insurance in California and engaged in the administration or adjustment of claims for a self insured employer is not exempt.
EXCEPTION2: A private self insurer that administers its own claims and/or the claims of other private self insurers with common ownership or which are in the same Master Certificate file is exempt from this requirement.
EXCEPTION3: A joint powers authority that holds a Master Certificate of Consent to Self Insure and administers its own claims; and/or the claims of other public self insurers which have an affiliate Certificate under the same Master Certificate file number held by the joint powers authority; and/or the claims of a former member of the joint powers authority is exempt from this requirement.
EXCEPTION4:A public self insurer that administers its own agency's claims is exempt from this requirement.
(b) Application for a Certificate to Administer shall be made on forms provided by Self-Insurance Plans (Form A4-50 (Rev. 4/91)). A complete application shall include the application form, and fees in accordance with Section 15454. NOTE:The current application form is contained in Plate L of the Appendix following the last Article of these Group 2 regulations.
(1) The applicant will be notified in writing within 14 days of receipt if the application is deficient.
(2) A certificate to administer will be issued within 30 days of receipt of a complete application.
(c) The Certificate to Administer expires June 30 and reapplication must be made prior to June 1 for the subsequent renewal period. The applicant may request the Certificate to Administer to be issued for a period of 1, 2 or 3 years.
(d) Failure to comply with Articles 6 and 9 of these regulations or engaging in improper practices as described in Labor Code Section 3702(a) is good cause for revocation or non-renewal of the Certificate to Administer.
Note: Authority cited: Sections 54, 55, 59, and 3702.10, Labor Code. Reference: Sections 59, 3702 and 3702.1, Labor Code. Government Code Sections 15375, 15376.
s 15450.1. Third Party Claims Administration for New Private Self Insurers.
(a) Each private self insurer granted an initial, individual Certificate to Self Insure workers' compensation liabilities that has not been self insured or previously self insured for a total of three full years shall contract with a third party claims administrator for the first three (3) full calendar years of self insurance. The self insured employer's third party claims administrator shall hold a Certificate to Administer pursuant to Section 15450 of these regulations.
(b) Each private group self insurer granted its initial Certificate to Self Insure workers' compensation liabilities shall contract with a third party administrator for the first five (5) full calendar years of self insurance. The group self insurer's third party claims administrator shall hold a Certificate to Administer pursuant to Section 15450 of these regulations.
Note: Authority cited: Sections 54, 55, 59 and 3702.10, Labor Code. Reference: Sections 3700, 3701, 3701.5, 3702, 3702.1, 3702.2 and 3702.3, Labor Code.
s 15452. Administrator Competence.
(a) Each self insurer or third party administrative agency shall conduct the administration of each self insurance program through the services of a competent person or persons located in California.
EXCEPTION1:Upon a showing of good cause, the Manager may authorize administration from locations outside California by an administrator with staff who has demonstrated individual competence. The desire to consolidate claims from other states in one location or the desire to reduce expenses related to utilizing a third party administer are not good cause for out-of-state administration. The demonstration of individual competence of an out-of-state administrator is not in itself good cause for out-of-state administration.
Exception2:The Manager shall not authorize claims administration outside of the State of California for any private group self insurer.
(b) Any person may demonstrate individual competence as an administrator for a self-administered self insurer or an agency administered self insurance program by successfully passing the written examination designed to test technical knowledge of workers' compensation law and claims administration. The Manager shall ensure that the test shall be administered at least twice a fiscal year (July 1 to June 30).
(c) Application for the administrator's examination shall be made on forms provided by the Manager (Form A4-100, Rev. 9/91). A complete application shall include the application form and fees in accordance with subsection (d) of this section. The applicant will be notified in writing within 14 days if the application is deficient. Confirmation of the test date will be sent two weeks before the scheduled test date.
(d) The fee to take the Self Insurance Administrator's examination shall be $150. The fee shall not be refundable after confirmation of entrance to the exam has been issued by the Office of Self Insurance Plans. Exception1:Upon a written showing of good cause, the Manager may authorize a refund of the application fee.
(e) Upon passing the written examination a Certificate of Achievement will be issued within eight weeks of the test date.
(f) Each adjusting location of a third party administrative agency or a self-administered self insurer shall have at least one person who has passed the self insurance administrator's examination. All workers' compensation self insurance claims at such reporting locations shall be administered and adjusted under the direct supervision of a person who has passed the self insurance administrator's examination. Supervision of claims decisions, setting of estimates of future liability of claims, and proper payment of benefits to injured workers shall be made or reviewed by a person who has passed the self insurance administrator's examination.
(g) Lack of competent administrators at any adjusting location shall be good cause for revocation of the certificate to administer for that location and may be grounds to revoke the certificate to self insure.
Note: Authority cited: Sections 54, 55, 59, and 3702.10, Labor Code. Reference: Sections 59, 3702, 3702.1 and 3702.10, Labor Code; and Sections 15375 and 15376, Government Code.
s 15454. Certificate to Administer: Fees.
(a) The certificate fee shall be paid no later than June 1 in the year of application and shall be sufficient to cover the 1 to 3 year period of the application submitted, and shall accompany the application form. The fee is not prorated in the initial year of each application cycle and is not refundable for any portion of the current fiscal year.
(b) The minimum fee for each private certificate to administer the first adjusting location is $1,000 per year. There is an additional charge of $200 per year for each additional claims adjusting location.
(c) Public applicants are exempt from the payment of a fee for the Certificate to Administer provided all claims administered are for public self insurers. A public administrator for private sector self insurers shall pay the certificate fees due for a private Certificate to Administer. (continued)