Bulletin 97-4
March 5, 1997

Judicial Ethics Advisory Committee Issues First Annual Report

A total of 26 complaints about the ethical conduct of workers' compensation referees were received by the Workers' Compensation Ethics Advisory Committee (EAC) during 1996, the committee's first annual report of its activities shows.

"This is a relatively small number in the light of the fact that there were 166 working referees during the year," said Casey L. Young, Administrative Director of the Division of Workers' Compensation, in releasing the report.

Young also noted that other data in the report shows the administrative director received over 100 requests for written approval to receive teaching fees, meals, honoraria, and other gifts, as well as to participate in various educational events. Advance written approval to receive any such item that exceeds five dollars in value is required under new DWC ethics regulations.

"Overall, statistics contained in the report seem to indicate that the division's new system to establish and enforce strict ethical standards for workers' compensation referees is working well and achieving its goals," Young said.

The nine-member EAC is an independent committee which was established on Dec. 1, 1995 under regulations promulgated by the DWC administrative director to receive, review and monitor complaints of misconduct made against workers' compensation referees.

Twenty-three of the complaints received were reviewed during the year, according to the report. The remaining three were scheduled for review at the committee's next scheduled meeting in March, 1997.

Of those reviewed, the committee determined that there was an insufficient showing of misconduct to warrant further investigation in 17. It recommended investigation by the DWC administrative director in the other six cases, three of which remain under active investigation.

In the three which were finalized, one referee accepted a one step (five percent) reduction in salary for throwing a file at a litigant during an angry verbal exchange. No misconduct was found in another case, in which it was alleged that a referee had ruled on cases litigated by counsel with whom the referee had direct financial interests, because appropriate disqualifications had occurred. And two referees were provided counseling sessions with their regional manager after it had been determined that inappropriate remarks were made to litigants during settlement conferences.

The EAC was established after a number of allegations concerning ethical conduct by workers' compensation referees had surfaced in earlier years. After those allegations were investigated, it was felt that an ongoing committee, representing a good cross section of people in the workers' compensation community as well members of the public totally removed from the workers' compensation community, would help maintain public confidence toward referees and the workers' compensation adjudicatory process.

The members of the committee are appointed by the DWC administrative director. They include three members of the public, one of whom represents organized labor, one of whom represents insurers, and one of whom represents self-insured employers; two attorneys who formerly practiced before the Workers' Compensation Appeals Board, one of whom usually represented insurers or employers and one of whom usually represented applicants (injured workers); a presiding referee and a referee or retired referee; and two members of the public outside the workers' compensation community.

The committee, which meets approximately four times a year to review complaints, is currently chaired by a Superior Court judge.

The report also pointed out that current ethical standards for workers' compensation referees actually exceed the standards for judges of the California superior and municipal courts, Young noted.

The State Labor Code requires referees to adhere to the Code of Judicial Ethics promulgated by the California Supreme Court. But they must also not accept any gift, honorarium or travel expense that is forbidden to member of the legislature under the Political Reform Act of 1974. And they must obtain written approval of the administrative director before accepting any teaching fee, meal or gift exceeding five dollars in value from one who practices or who has interests before the WCAB.