New Temporary Total Disability Changes for 2023

Beginning in 2023, workers who suffer temporary total disability (TTD) due to a workplace injury are eligible for increased TTD rates. This change is part of an effort by the state government to ensure that injured workers are provided with fair compensation while they recover from their injuries and return to work. The new TTD rate structure also makes it easier for employers to accurately calculate the amount of TTD they owe their employees without having to consult overly complex formulas or outdated information.

In this article, we'll take a brief look at the new TTD rates and some calculations that can help you understand the change.

Explaining the rate change

The California Workers' Compensation Institute shared that the State Average Weekly Wage (SAWW) in California saw a 5% increase from the start of 2021 to 2022, ultimately leading to higher temporary total disability and permanent total disability rates for work injury claims and related workers’ compensation benefits in 2023.

California’s SAWW increased by 5.159% from $1,570 in the first quarter of 2021 to $1,651 in the first quarter of 2022. Following a record-breaking 13.5% increase that began in January 2022, the TTD/PTD maximum rate will rise once more, this time by $79.44 to the figure of $1,619.15 per week for any claims with injury dates on or after January 1st, 2023!

Instead of being $1,539.71 which was the earnings per week for 2022 injuries, workers injured during and beyond this year (2023) can expect to receive up to a total of $1,619.15 each week if they qualify!

As established by State law, the minimum weekly TTD/PTD rates for claims with 2023 injury dates will be increased from $230.95 to $242.86 per week—a rise of $11.91–in accordance with SAWW increases. The California Division of Workers’ Compensation has officially confirmed these new TTD/PTD rates and intends to release a Newsline announcing them shortly thereafter.

Starting on Jan. 1, 2023, other workers' compensation benefits, such as temporary total disability payments made 2 years or more after the injury and life pensioner and permanent total disability payments for injuries sustained from Jan. 1 2003 onwards, will increase due to the Social Average Weekly Wage adjustment.

Likewise, penalties will ensue when there is an underpayment of benefits, so they CWCi strongly recommend that claims administrators review any alterations in benefit rates with lawful advice to ensure accuracy and correctness.

New TTD Calculations

The calculation of the 2023 SAWW increase is as follows:

1. (2022 SAWW – 2021 SAWW)/2021 SAWW:

$1,651 - $1,570 = 81/1570 = 5.15924%

2. 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

3. 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

Final Thoughts

By understanding the new TTD rates and how they are calculated, employers can ensure they are providing injured workers with fair compensation while also staying compliant with state laws. This will help to create a safer work environment for all employees and keep businesses out of trouble in regard to workers’ compensation regulations. With these changes, both employers and employees can hopefully rest assured that TTD payments are fair and appropriate under current conditions. If you need help with understanding TTD payments for your workers' comp, please contact us.

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Cole, Fisher, Cole, O’Keefe + Mahoney is Central California’s leading workers’ compensation and social security disability law firm. With over 30 years of successful experience, we are committed to securing maximum benefits for our clients in the Fresno, California area. Schedule a free consultation today.