By Jorge Casuso

March 11, 2026 -- The number of open worker compensation claims filed by City workers grew to a record 653 during the past fiscal year, or nearly one-third of all employees, according to a report to the City Council last week.

Of the open claims, 301 were filed during the last fiscal year, bringing to $25.9 million the total direct costs to the City, including $15.9 million in medical, indemnity and miscellaneous payments, according to the Workers’ Compensation Annual Report.

The $1.6 million increase in the City's "direct financial responsibility" is driven by an increase in claims filed and "the continued predominance of cumulative trauma injuries," said the report from Finance Director Oscar Santiago.

The number of claims filed during FY 2024-25 is the highest in five years, while cumulative trauma injuries now account for 53 percent of new claims, according to the March 5 report.

While the increase in claims took place across "multiple departments," the Fire Department saw the "most considerable growth," with claims increasing 14 percent.

Meanwhile the Transportation Department saw a 13 percent increase in claims and the Police Department saw a 9 percent increase. Public Works was the only major department that saw claims decrease, with a 23 percent reduction.

"The injury profile of claims filed during FY 2024-25 is concerning, suggesting they will be costly," the report warned.

"A significant number of new claim filings are for cumulative trauma injuries that are the result of performing repetitive physically and/or mentally demanding tasks over long periods of time," the report said.

"The cumulative trauma injury claims are common in an aging workforce, and typically involve several body parts and legal representation, making them costly. As a result, the City’s workers’ compensation liabilities are expected to rise as these claims develop."

The number of claims settled by the City decreased from 72 claim
settlements in FY 2023-24 totaling $4,270,553 to 67 claims for a total value of $3,817,002.

"The number and value of settlements tend to fluctuate from year to year due to the severity and timing of injuries, and the willingness of injured employees to settle claims," the report said.

According to the report, overall program expenses decreased by $900,000 in the last fiscal year "largely due to a 22 percent reduction in medical payments."

As an employer, the City must pay workers compensation benefits to workers injured while carrying out assigned job duties.

This covers all medical treatment in connection with the injury, as well as indemnity payments "to offset lost wages and/or the residual impact of the injury," the report noted.

Strategies implemented by the City to contain costs -- including the "Wow, that's Fast" and Return-to-Work programs -- "continued to reduce litigation rates and temporary disability costs," according to the report.

Despite the rise in the City's direct financial responsibility to nearly $26 million in FY 2024-25, the Self-Insured Retention (SIR) Program Liabilities "remained well below an all-time high of $29.9 million from FY 2018-19," the report said.

The rise in the frequency of claims filed by City workers "aligns with statewide patterns" outlined a report last year from the State's Workers' Compensation Insurance Rating Bureau (WCIRB).

The report found that California's cumulative trauma claims increased year-over-year by 32.1 percent, while the nation saw a 7.6 percent decline in indemnity claims.