December 2022: DWC Announces Temporary Total Disability Rates for 2023

07 Dec

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Update Applicable to:
All employers.

What happened?
On November 17, 2022, the Division of Workers’ Compensation (DWC) announced that the 2023 minimum and maximum temporary total disability (TTD) rates will increase on January 1, 2023.

What are the details?
Effective January 1, 2023, The minimum TTD rate will increase from $230.95 to $242.86, and the maximum TTD rate will increase from $1,539.71 to $1,619.15 per week.

Labor Code Section 4453(a) (10) requires the maximum and minimum weekly earnings upon which TTD is based to be increased by an amount equal to a percentage increase in the State Average Weekly Wage (SAWW) as compared to the prior year. The SAWW is the average weekly wage paid to employees covered by unemployment insurance as reported by the U.S. Department of Labor for California for the 12 months ending March 31 in the year preceding the injury. In the 12 months ending March 31, 2022, the SAWW increased from $1,570 to $1,651—an increase of 5.15924 percent.

The calculation of the 2023 SAWW increase is as follows:

(2022 SAWW – 2021 SAWW)/2021 SAWW
$1,651 – $1,570 = 81/1570 = 5.15924%

The calculation of the minimum TTD rate for 2023 is as follows:

Minimum earnings for 2023 x SAWW increase x 2/3 = minimum TTD rate for 2023
$346.42 x 1.0515924 = $364.29 minimum TTD earnings x 2/3 = $242.86 minimum rate for 2023

The calculation of the maximum TTD rate for 2023 is as follows:

Maximum earnings for 2023 x SAWW increase x 2/3 = maximum TTD rate for 2023
$2,309.56 x 1.0515924 = $2,428.72 maximum TTD earnings x 2/3 = $1,619.15 maximum rate

Under Labor Code Section 4659(c), workers with a date of injury on or after January 1, 2003, who received life pension (LP) or permanent total disability (PTD) benefits are also entitled to have their weekly LP or PTD rate adjusted based on the SAWW.

SAWW figures may be verified using the U.S. Department of Labor’s data.

For more information, please see the links below:

USDIR Announcement

Unemployment Insurance Data

Article

What do employers need to do?
Employers should review the links above and be aware of the increase in TTD rates.

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