Existing law establishes employer assessments and surcharges used to fund California’s workers’ compensation, occupational safety and health, and labor enforcement systems, establishes the Subsequent Injuries Benefits Trust Fund (SIBTF), governs Workers’ Compensation Appeals Board proceedings, provides for state contributions to CalPERS, and establishes state workforce-development programs.
SB 171 makes several significant changes. For employers, one of the most direct requirements is that specified workers’ compensation assessments and surcharges must be paid by electronic funds transfer, with a ten percent (10%) penalty for untimely or unpaid amounts or failure to make such payments by electronic fund transfer. The law also substantially revises SIBTF eligibility and administration, including defining when a preexisting disability is “labor disabling,” modifying filing deadlines and evidentiary requirements, and changing how certain SIBTF payments are administered. It also makes specified reconsideration procedures before the Workers’ Compensation Appeals Board permanent by eliminating the July 1, 2026, expiration date and indefinitely continuing the rule that a petition for reconsideration is deemed denied if the Board does not act on it within 60 days.
Separately, SB 171 appropriates approximately $3.018 billion from the State’s General Fund to the Public Employees’ Retirement Fund to reduce unfunded liabilities associated with specified state employee CalPERS categories. It also revises reporting requirements for several California Workforce Development Board grant programs. Because this is a budget trailer bill, the provisions took effect immediately.
Employers subject to the affected workers compensation assessments should confirm that payments are made electronically and timely to avoid the new penalty. Agencies administering workers compensation claims should also review the SIBTF eligibility criteria and changes to the reconsideration procedures used by the Workers’ Compensation Appeals Board to determine their effect, if any, on pending and future claims for workers’ compensation.
SB 171 amends and adds provisions of the Government, Labor, Streets and Highways, and Unemployment Insurance Codes and amends, adds, and repeals specified Labor Code provisions to implement 2026 budget related labor, worker’s compensation, CalPERS, and workforce changes. Specifically it amends Government Code section 11553 and adds section 20825.21, amends Labor Code sections 62.5, 138.1, 3702.9, 4706.5, 4751, 4753, 4754, 4755, and 4756; amends and repeals section 5909; adds sections 4750, 4754.1, 4754.2, 4754.3, and 4757, adds and repeals section 4578, amends Streets and Highways Code section 2038, and amends Unemployment Insurance Code section 14013, 14014, 14033, and 14042.
