Travelers Indemnity Co. v. Workers Compensation Appeals Board

("Date of Injury" Is Determined under Labor Code Section 5412 When Deciding Whether to Send a Workers' Compensation Coverage Dispute to Mandatory Arbitration)

(September 2025) - In Travelers Indemnity Co. v. Workers' Compensation Appeals Board, 111 Cal. App. 5th 568 (May 7, 2025), the California Fourth District Court of Appeal addressed whether a dispute over insurance coverage in a workers' compensation case should be subject to mandatory arbitration under California Labor Code section 5275(a)(1). This case arose from a claim filed by George Zeber, a former professional baseball player, who alleged cumulative injuries sustained during his employment with the New York Yankees from 1968 to 1978. Travelers Indemnity Company ("Travelers") disputed whether the New York Yankees had workers' compensation coverage during that time. The Workers' Compensation Appeals Board ("WCAB") found that Zeber had sustained a compensable injury, but deferred any award pending mandatory arbitration of the insurance coverage dispute. Travelers challenged this decision, arguing that the WCAB lacked authority to compel arbitration because the injury occurred before the statutory threshold date for mandatory arbitration.

California Labor Code section 5275 provides:

(a) Disputes involving the following issues shall be submitted for arbitration:

(1) Insurance coverage.

(2) Right of contribution in accordance with Section 5500.5.

(b) By agreement of the parties, any issue arising under Division 1 (commencing with Section 50) or Division 4 (commencing with Section 3200) may be submitted for arbitration, regardless of the date of injury.

The Court of Appeal held that "[t]he statutory language evidences that certain issues must be submitted for mandatory arbitration, whereas other issues 'may be submitted for arbitration, regardless of the date of injury.'" Although section 5275(a)(1) does not reference a "date of injury," the Court of Appeal held that when viewed in connection with subsection (b), the "date of injury" limits when an issue is subject to mandatory arbitration. The Court of Appeal also held that while section 5275(a)(1) is silent on how the "date of injury" limits arbitration of insurance coverage disputes, the WCAB has consistently concluded that such disputes must be submitted to mandatory arbitration only if the injury occurs on or after a specific triggering date. The Court of Appeal agreed with the WCAB's interpretation that the triggering date for mandatory arbitration pursuant to section 5275(a)(1) is January 1, 1990, reasoning that section 5275 became effective on that date.

Although the parties agreed that section 5275(a)(1) applies only where the "date of injury" occurs on or after January 1, 1990, they disagreed on how to determine the "date of injury" in this case. While the WCAB argued that the "date of injury" must be determined pursuant to California Labor Code section 5412, Travelers argued that it was the last day that Zeber sustained his workplace injury, which was September 1, 1978. The Court of Appeal concluded that the "date of injury" for purposes of mandatory arbitration in cases involving a cumulative trauma (like Zeber's case) is the "date of injury" set forth in section California Labor Code section 5412. "Under the plain language of section 5412, Zeber's 'date of injury' occurred at the time Zeber suffered disability and either knew or should have known his disability was caused by his present or prior employment." The Court of Appeal held that the stipulated September 1, 1978 date was insufficient to determine the "date of injury" because that date satisfies only the first element (i.e., the date of disability) and not the second element (i.e., the date of actual or constructive knowledge).

In this case, the workers' compensation judge ("WCJ") never made a finding of the "date of injury" under section 5412 for the purposes of section 5275(a)(1). Instead, the WCJ focused on tolling the statute of limitations based on Zeber's delayed awareness of his right to file a claim, which the Court of Appeal noted is not the same as knowing the disability was caused by a present or prior employment. Because the date of injury is a factual prerequisite for determining whether mandatory arbitration applies, and no such finding was made, the Court of Appeal concluded that the WCAB acted in excess of its authority to send the insurance coverage dispute to mandatory arbitration. As a result, the Court of Appeal annulled the WCAB's decision and remanded the case for further proceedings, including a factual determination of the "date of injury" under section 5412.

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