PROCEEDINGS to review a decision of the Workers‟ Compensation Appeals Board. Affirmed in part; annulled in part and remanded with directions. (W.C.A.B. Nos. VNO 0471122; VNO 0520494).
The opinion of the court was delivered by: Manella, J.
CERTIFIED FOR PUBLICATION
This case turns on the effect of an amendment to the statutes that govern the permanent disability component of workers‟ compensation. Labor Code section 4658 contains several formulas for determining the number of weeks an injured worker will receive permanent disability benefits.*fn1 In 2004, subdivision (d) was added to section 4658, creating a new formula that applies to injuries occurring on or after January 1, 2005.*fn2 Included within subdivision (d) are two provisions -- subdivision (d)(2) and (d)(3) -- that apply to employers of 50 or more persons: subdivision (d)(2) requires permanent disability benefits to be increased by 15 percent if the employer does not offer the injured employee regular work, modified work or alternative work within 60 days of the disability becoming permanent and stationary; subdivision (d)(3) requires permanent disability benefits to be decreased by 15 percent if the employer does offer the injured employee regular work, modified work or alternative work.*fn3 The parties here, petitioner Donald Bontempo and his employer, respondent City of Alhambra (City), stipulated that Bontempo‟s employment-related pulmonary condition was permanent and stationary and that he was being paid $253 in weekly benefits, an amount that included the additional 15 percent prescribed by section 4658, subdivision (d)(2). They asked the workers‟ compensation judge (WCJ) to resolve the issues of "permanent disability" and "apportionment." Using the formula in section 4658, subdivision (d)(1), the WCJ awarded Bontempo an amount for the percentage disability he suffered, but did not apply section 4658, subdivision (d)(2), or consider whether it applied.
In a petition for reconsideration submitted to the workers‟ compensation appeals board (the Board), Bontempo contended that section 4658, subdivision (d)(2), was in issue before the WCJ, that the evidence presented supported awarding the additional 15 percent required by the provision, and that the WCJ erred in failing to include that amount in the award. The Board denied the petition for reconsideration on the ground that Bontempo had not "raise[d] any issue with respect to increased permanent disability indemnity pursuant to Labor Code section 4658 at trial or in any Pre-Trial Conference Statement prior to trial." Bontempo filed a petition seeking review. We granted review and now conclude that the WCJ erred in failing to apply section 4658, subdivision (d)(2), on the record presented, and that the Board erred in concluding the issue of section 4658, subdivision (d)(2), had not been raised.
FACTUAL AND PROCEDURAL BACKGROUND
Bontempo was employed as a street maintenance worker for the City. On March 28, 2003, he sustained an injury to his right knee after falling off a City maintenance truck. On April 14, 2003, Bontempo filed an Application for Adjudication of Claim with the Board, based on the knee injury (claim no. VNO 0471122). The application alleged that the injury caused continuous disability from March 29, 2003. In December 2004, Bontempo obtained a report from a physician, Daniel Kharrazi, M.D., indicating he had reach permanent and stationary status in November, and the matter was set for a hearing.*fn4 The hearing was taken off calendar when the parties decided to have Bontempo seen by an agreed medical examiner, Mason Hohl, M.D., who examined and interviewed Bontempo and issued a report in November 2005.*fn5
On October 27, 2005, before claim no. VNO 0471122 could be resolved, Bontempo filed a second Application for Adjudication of Claim with the Board (claim no. VNO 0520494). This application was based on pulmonary injury and alleged that such injury occurred between 1998 and October 24, 2005. The two claims were consolidated.
C. Relevant Medical Reports 1. Pulmonary Report
In February 2006, Jonathan C. Green, M.D. conducted an agreed medical examination and reported on Bontempo‟s pulmonary condition. After examining and interviewing Bontempo and reviewing his medical records, Dr. Green concluded that his pulmonary condition was permanent and stationary and had resulted in a 25 percent impairment. He estimated that 80 percent of Bontempo‟s pulmonary impairment was related to industrial exposure.
Dr. Green‟s report stated that Bontempo was incapable of returning to his usual and customary occupation due to potential "exposure to asphalt, cement, and other similar environmental substances which in the working environment would lead to irritation to the lung." The report also stated that Bontempo had been off work since August 31, 2005, "as apparently his employer did not have a position for him" and "there was no restricted duty available."
In January 2007, Gerald M. Paul, M.D. conducted an agreed medical examination and reported on Bontempo‟s orthopedic condition. Dr. Paul noted that Bontempo had been declared permanent and stationary by Dr. Kharrazi in late 2004 and that Dr. Hohl in his November 2005 report had concurred with Dr. Kharrazi. Dr. Paul agreed that Bontempo was permanent and stationary. He did not specify the date when that condition was reached, but noted that Bontempo had become permanent and stationary "under the old system" and, therefore, need not be evaluated under the newer, AMA guidelines.*fn6
Dr. Paul‟s report stated that Bontempo was not capable of resuming his usual and customary occupational demands, as he was subject to work restrictions precluding heavy lifting, prolonged weightbearing, climbing, walking over irregular terrain, squatting, kneeling, crouching, crawling and pivoting. Dr. Paul noted that Bontempo had been off work since mid-2005.
C. Pre-Trial Conference Statements
Prior to the scheduled hearing dates, the parties filed joint pre-trial conference statements.*fn7 In the 2005 pre-trial conference statement for claim no. VNO 0471122 (the orthopedic claim), the parties stipulated that Bontempo‟s knee injury arose out of and in the course of his employment and that at the time of the injury, his earnings were $814.12 per week, warranting an indemnity rate of $542.75 per week for temporary disability and $185 per week for permanent disability. The parties further stipulated that the City had already paid (1) temporary disability at the rate of $542.75 during various periods (from March 29 through September 24, 2003, from September 30 through November 30, 2003, and from April 24 through August 8, 2004); and (2) permanent disability at the rate of $185 from December 1, 2003 through April 20, 2004 and continuously from August 9, 2004. The pre-trial conference statement form contained boxes for indicating the issues to be addressed by the WCJ. The parties checked the boxes labeled "permanent disability," "apportionment," "need for further medical treatment," "liability for self-procured medical treatment," "liens" and "attorney fees."*fn8
In the 2007 updated pre-trial conference statement for the orthopedic claim, the parties reiterated the above stipulations with respect to the date of the injury, the injury‟s relationship to Bontempo‟s employment, Bontempo‟s earnings at the time of the injury, the indemnity rates for temporary and permanent disability, and the amounts paid by the City. The 2007 statement contained more recent information concerning the City‟s payments to Bontempo, clarifying that permanent disability had been paid at the rate of $185 per week from August 9, 2004 through December 1, 2005 and continuing from January 19, 2007. With respect to issues to be addressed at the hearing, the parties checked the same boxes as before and in addition, checked boxes on the form indicating that there was a dispute over temporary disability and the permanent and stationary date.*fn9
In the pre-trial conference statement for claim no. VNO 0520494 (the pulmonary claim), the parties stipulated that Bontempo suffered injury to his respiratory system during the period from 1998 to October 24, 2005, the injury arose out of and in the course of his employment with the City, and at the time of the injury, Bontempo‟s earnings were $910.68 per week, warranting an indemnity rate of $607.12 per week for temporary disability and $220 per week for permanent disability. The parties further stipulated that the City had paid (1) temporary disability in the amount of $607.12 per week from September 8 to September 12, 2005 and from September 20, 2005 to February 23, 2006; and (2) permanent disability in the amount of $253.00 per week continuously from February 24, 2006. To indicate pending ...