a. Determining The Injured Employee’s Post-Injury Earnings
In determining an individual employee’s proportional earnings loss,
the first step ordinarily will be to establish the employee’s actual earnings in the three
years following his or her injury (as did the RAND Studies), using the employee’s EDD wage
data or other empirical wage information. Generally, this will be accomplished by having
the employee obtain his or her wage information from EDD (Unemp. Ins. Code, § 1094(e)),
either voluntarily or through an order compelling. However, other empirical earnings
information also may be used, including earnings records from the Social Security Administration.
(42 U.S.C. §§ 405(c)(3), 1306; 20 C.F.R. §§ 401.100(a), 404.810(a); 5 U.S.C. § 552a(b);
see also, Jimenez v. San Joaquin Valley Labor (2002) 67 Cal.Comp.Cases 74, 84
(Appeals Board en banc) (Jimenez); Garber v. Worker’s Comp. Appeals Bd. (1999)
64 Cal.Comp.Cases 248 (writ den.).) Moreover, while federal and state tax records,
including W-2 forms, are privileged (Schnabel v. Superior Court (1993) 5 Cal.4th 704,
718-723 (Schnabel); Ameri-Medical Corp. v. Workers’ Comp. Appeals Bd.
(Rhooms) (1996) 42 Cal.App.4th 1260, 1289 [61 Cal. Comp. Cases 149, 170] (Rhooms)),
“[t]he privilege is not absolute” and does not apply where a stronger public policy controls
or when a party has waived the privilege. (Schnabel, 5 Cal.4th at p. 718;
Weingarten v. Superior Court (2002) 102 Cal.App.4th 268, 274; Jimenez, 67 Cal.Comp.Cases at p. 84.)
Yet, although the 2003 and 2004 RAND Studies used three years of post-injury earnings
as the basis for their proportional earnings loss calculations, there is nothing magical
about a three-year period. This is because the 2003 and 2004 RAND Studies used three-year
proportional earnings losses only “because these data provide the best balance between
representing long-term outcomes and a sufficient number of observations with which to
conduct [an] analysis” for a large-scale study. (See 2004 RAND Study, at p. 3.)
In cases of individual injured employees, however, a longer or shorter period of
post-injury earnings may be appropriate. For example, if an employee’s injury
results in a long period of temporary disability, then it might be appropriate
to use a longer period than three years – or a three-year period with a starting
date later than the date of injury, such as the injured employee’s permanent and
stationary date – for assessing the injured employee’s “long-term loss of income.”
(Lab. Code, § 4660(b)(2).) As another example, where an injured employee becomes
permanent and stationary (i.e., reaches maximum medical improvement) shortly after the date
of his or her industrial injury, then an attempt to rebut the DFEC portion of the 2005 Schedule
need not be delayed until three years of post-injury wage data becomes available. In such a case,
it might be appropriate to use a shorter period of wage data or to make projections that estimate
three years of post-injury earnings.16