Llena: Earning Capacity and Permanent Total Disability

Starting a new job at lower pay can make sense when the employer promises raises and a better future. If an injury then ends your working life, having benefits tied only to that lower starting wage can deepen the financial loss. Your work history and the evidence of what you could have earned may deserve a closer look.

In Llena v. Macy’s Inc., No. ADJ4503401 (WCAB Oct. 7, 2024), the Workers’ Compensation Appeals Board upheld a $520 average-weekly-earnings figure based on earning capacity, rather than the worker’s lower actual wages at Macy’s. It also upheld permanent total disability after examining the medical and vocational evidence. The precise benefit rate and attorney’s fees required further proceedings.

The lower starting wage did not fairly reflect her earning capacity

Magdalena Llena worked as a cashier and retail clerk. Immediately before joining Macy’s, she worked full time at Michaels for $13 an hour. She moved directly between the jobs, with no time off. Macy’s initially paid $10 an hour, but she testified that it promised raises that would leave her earning more than she had at Michaels.

The employer urged the judge to use her actual Macy’s earnings of $382.35 a week. The judge credited Llena’s testimony about her prior full-time work and the promised raises; that testimony was unrebutted. Her earlier $13 hourly rate for 40 hours supported earning capacity of at least $520 a week.

The earnings analysis in Llena applied Labor Code section 4453(c)(4). When the other statutory methods cannot reasonably and fairly be applied, that provision permits an estimate of average weekly earning capacity, with due consideration to actual earnings from all employments. The Board found that limiting Llena to her lower starting wages would be unfair on this record.

The decision drew on Argonaut Insurance Co. v. Industrial Accident Commission (Montana), 57 Cal.2d 589, 594–595 (1962), and Goytia v. Workers’ Compensation Appeals Board, 1 Cal.3d 889, 894–895 (1970), as explained in Llena’s discussion of the relevant circumstances. The inquiry was broader than a single paycheck: Her demonstrated prior earnings and the employer’s promise supported the estimate together.

For another worker, the task is to show why the ordinary wage calculation is unfair and what evidence supports a different estimate. Earlier payroll records, hours worked, an offer letter, raise schedules and firsthand testimony about the hiring discussion can help. Section 4453(c) calls for a supported calculation under the applicable method, rather than simply selecting the largest wage the worker has ever received.

The medical record supported the disability findings

Llena’s industrial injury occurred in February 2008. The record addressed numerous orthopedic, internal-medicine, psychiatric and dental conditions. The judge identified the medical reports and rating components that produced a combined scheduled permanent-disability rating of 99 percent.

The employer challenged Dr. Frederick Butler’s internal-medicine opinion as lacking a complete history. The Board found that he had obtained the history through a thorough review of extensive medical records. It also rejected the premise that a diagnosis predating the injury, by itself, established that the condition caused disability warranting apportionment.

The medical-evidence discussion in Llena placed the burden of proving apportionment on the employer and examined whether its position had substantial medical and record support. The employer failed to identify specific evidence supporting its orthopedic apportionment argument. The attached judge’s reasoning also described proposed apportionment as conclusory and inadequately explained.

Apportionment concerns the causes of permanent disability. Under Labor Code section 4663, the physician must address how much permanent disability resulted from the industrial injury and how much from other causes. A useful review therefore examines the doctor’s causal explanation, the relevant medical history and the evidence supporting the percentages—not merely a list of preexisting diagnoses.

The vocational opinion had useful and defective parts

A 99-percent scheduled rating and a finding of permanent total disability were separate steps. Vocational evaluator Laura Wilson assessed whether Llena could be retrained or sustain work in the open labor market. The Board examined which parts of her reasoning were within her expertise and supported by the medical record.

One part was defective. Wilson had discounted proposed medical apportionment because the identified factors had not prevented Llena from working before the injury. The Board explained that this substituted impermissible vocational apportionment for medical analysis under Nunes v. State of California, Department of Motor Vehicles, 88 Cal.Comp.Cases 741 and 894 (WCAB 2023) (en banc). On this record, however, the judge had already found no valid basis for medical apportionment, and the employer had failed to prove one. That was why the defect did not change the result.

The apportionment analysis in Llena matters when evaluating a vocational report: The ability to work before the injury does not authorize an expert to discard otherwise valid medical apportionment. Counsel needs to examine the medical opinion itself and the evidence of what caused the permanent disability.

Wilson also offered an opinion that impairments should be added because of their combined effects. The Board held that she lacked the medical expertise required for that conclusion. Applying Vigil v. County of Kern, 89 Cal.Comp.Cases 686, 692 (WCAB 2024) (en banc), it explained the need for medical evidence about how impairments affect activities of daily living and whether their effects overlap or amplify one another.

Yet the separate vocational reasoning in Llena remained usable. The judge had combined the overall impairment groups to reach the 99-percent scheduled rating rather than relying on Wilson’s proposed addition. Her work-capacity assessment separately relied on restrictions supplied by the reporting physicians, rather than her own medical view about combining impairments.

Wilson considered Llena’s physical and emotional limitations, medication effects and transferable skills. She attributed the inability to sustain gainful employment and participate in vocational rehabilitation to the industrial injury and the medically established limitations, rather than age, general labor-market conditions or other nonindustrial factors.

The Board’s assessment of that vocational evidence in Llena applied LeBoeuf v. Workers’ Compensation Appeals Board, 34 Cal.3d 234, 243 (1983). Together with the medical record, the work-capacity analysis supported permanent total disability. The conclusion followed from the evidence about this worker’s ability to work and be rehabilitated; 99 percent was not simply rounded up to 100.

The disability finding survived; the payment rate needed more work

The employer also identified a discrepancy in the money calculations. The judge’s award specified a lifetime weekly benefit of $346.66, while an attached disability-evaluation calculation listed a “life pension rate after commutation” of $319.39. The judge’s report and the worker’s answer did not explain that difference.

The amended findings in Llena preserved permanent total disability but deferred the rate or rates of compensation and reasonable attorney’s fees. The Board rescinded and deferred the corresponding award provisions and returned those questions to the trial judge for further proceedings and a clear determination.

Those figures describe the discrepancy the Board required the judge to resolve. Neither can be treated as the final weekly payment established by this decision. Likewise, the original attorney-fee figure was deferred. A favorable disability finding and a supported earnings figure still need a properly explained calculation of the resulting payments.

Build the wage and work-capacity evidence together

For an earnings dispute, reconstruct the employment transition: Prior pay and hours, the new starting wage, what was promised and the evidence supporting that account. Identify the circumstances existing at the time of injury that explain why the starting paycheck did not fairly represent earning capacity.

For permanent disability, connect each medical restriction to the vocational analysis. Ask how the evaluator tested rehabilitation and work options, which limitations came from physicians, and whether the report improperly replaced a medical judgment about apportionment or impairment ratings.

Finally, compare the findings with the proposed payment calculation, including any commutation that changes how benefits fund attorney’s fees. Llena’s 2008 injury must be understood under the rules applicable to that injury; its medical components and payment figures should not be transferred to a different claim. Our Ogilvie analysis explains the separate history of challenging a scheduled rating, while Radilla examines the medical evidence supporting an alternative impairment rating and addition.