REPORT TO COUNCIL
SUBJECT
Title
Update and Recent Trends Regarding City Workers' Compensation Programs (Information Only)
Report
BACKGROUND
Part of the City's risk management program focuses on protecting City employees, including proactive safety programs to reduce potential hazards, and managing the City's workers' compensation program. The workers' compensation system provides benefits to employees for work-related injuries or illnesses. These benefits may include medical treatment, payments for lost wages, payments that compensate the injured employee for having a permanent impairment or limitation, paid time off when an injured worker is temporarily off work, and death benefits. Workers' compensation benefits are tax free and are not subject to Social Security deductions. Laws and regulations on workers' compensation are set forth in California Workers' Compensation Law.
As an alternative to purchasing commercial insurance coverage, the City of Sunnyvale began its self-insured workers' compensation program on July 1, 1963. Its current self-insured retention is $500,000, and excess coverage is provided by the CSAC Excess Insurance Authority, a California Joint Power Authority (JPA) that provides insurance to its members. This JPA is a member-directed risk sharing pool which is currently comprised of 55 counties and 273 California public entities, including cities, educational institutions, housing authorities, and other California JPAs. Annual premium deposits are made by the City for its pro-rated share on risk of loss. Claims administration services are currently provided by AIMS (Acclamation Insurance Management Services), a Third-Party Administrator (TPA).
DISCUSSION
The first step in the process of managing workers' compensation risk is identifying and classifying the prospective risk. Risk prevention measures are always being considered when it comes to employee wellness and safety. The City provides safety training for employees and coordinates er...
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