SIBTF Proof Burden Case Clarifies Credit Reduction Rule 2025

April 16, 2025 | SIBTF.org — SIBTF Proof Burden Highlights Credit Disputes: The Subsequent Injuries Benefits Trust Fund (SIBTF) supports injured workers whose job-related injuries, when combined with prior disabilities, result in a permanent disability rating of 70% or more (Labor Code § 4751). However, under Labor Code § 4753, SIBTF benefits must be reduced if the applicant already receives payments for the pre-existing conditions. These “credits” are meant to preserve public funds and ensure benefits are properly calibrated to a worker’s actual level of impairment.

But recent case law has reinforced the SIBTF proof burden, placing the responsibility on the Fund to demonstrate that the credit taken directly applies to the same pre-existing disability used to qualify the applicant. Without clear and specific evidence, courts have shown reluctance to allow broad or assumptive reductions—especially when SSDI or pension benefits are involved.

Nancy Vargas: A Case Study in Burden of Proof

Nancy Vargas spent 25 years driving buses for the Santa Barbara Metropolitan Transit District. In March 2018, she injured her foot stepping off the driver’s pedestal. She later settled her workers’ compensation case in December 2020, accepting a 26% permanent disability rating.

While her case was still active, Vargas applied for SIBTF benefits. She listed pre-existing issues involving her back, upper extremities, left knee, and right ankle. Importantly, she disclosed that she had filed a prior workers’ compensation claim and began receiving Social Security Disability Insurance (SSDI) payments of $940 per month starting in January 2018. SIBTF Deficit Alarm

The Fund acknowledged Vargas’s eligibility under § 4751 but attempted to reduce her benefits under § 4753, arguing that her SSDI payments should count as credit toward pre-existing disabilities.

Why the Fund Lost: Insufficient Evidence

The Workers’ Compensation Judge (WCJ) rejected the Fund’s credit claim, ruling that it failed to prove the SSDI payments were awarded due to Vargas’s pre-existing conditions. The WCJ emphasized that assumptions were not enough. The SSDI award letter and subsequent benefit statements did not specify which conditions the payments were for.

The Workers’ Compensation Appeals Board (WCAB) upheld this ruling, stressing that § 4753 does not offer automatic credit. Instead, the Fund must show—by preponderance of the evidence—that the applicant’s other payments are for the same disabilities used to qualify for SIBTF.

Court of Appeal Upholds Ruling

The SIBTF petitioned for review. It argued that the burden of proof should not lie with the Fund. However, in Subsequent Injuries Benefits Trust Fund v. Workers’ Comp. Appeals Bd. (July 2024, B333633), the California Court of Appeal rejected that position.

“We agree with the Board that the Fund must prove its entitlement to a credit for SSDI and other ‘monetary payments’ received by applicants. The burden of proof in workers’ compensation proceedings rests upon the party holding the affirmative of the issue.” – Court of Appeal

The court clarified:

Applicants must prove eligibility for SIBTF benefits under § 4751.
The Fund, in turn, must prove any reduction is justified under § 4753—and specify how much.

What This Means for Employers and Applicants

This case is a wake-up call. With increasing pressure on the Fund’s solvency, accurate credit claims are essential—but proof is non-negotiable. The court’s decision signals a strict interpretation of the SIBTF proof burden, even as the Fund faces mounting financial strain.

For employers and applicants alike, this means that documentation must go beyond surface-level. The SIBTF proof burden requires the Fund to connect any credits claimed—such as SSDI, pensions, or prior settlements—directly to the same pre-existing impairments used to qualify for SIBTF. Simply stating that a benefit exists isn’t enough; there must be medical, legal, or administrative records that draw a clear and direct correlation.

If you’re an applicant or employer involved in a SIBTF case, ensure your documentation is thorough, especially when SSDI or other disability benefits are involved. Evidence must explicitly tie those benefits to pre-existing disabilities. Without it, no credit will be granted—and the claim could be delayed or denied.

Source: wcexec

Visit SIBTF.org for expert resources, legal updates, and support for applicants and employers alike.

FAQs: SIBTF Credit Reduction and Proof Burden

What is the SIBTF proof burden under California law?

The SIBTF proof burden refers to the legal responsibility of the Subsequent Injuries Benefits Trust Fund to provide evidence justifying any reduction in benefits under Labor Code § 4753. The Fund must demonstrate that payments like SSDI directly relate to pre-existing disabilities used in the claim.

How did the court rule on the SIBTF proof burden in the Vargas case?

The court upheld that the burden of proof lies with SIBTF, not the applicant. The Fund must show specific evidence linking SSDI or other benefits to prior conditions used to qualify for SIBTF.

How can applicants prepare for SIBTF proof burden challenges?

Applicants should maintain detailed records of all disability-related payments, including award letters that specify the condition. When applying for SIBTF, ensure medical and legal documentation clearly differentiates between work-related and pre-existing disabilities to avoid disputes over benefit reductions.

What documentation is needed to meet the SIBTF proof burden?

To satisfy the SIBTF proof burden, the Fund must provide award letters, medical reports, and benefit statements that clearly identify which disabilities the payments address.

What is SIBTF?

The Subsequent Injuries Benefits Trust Fund (SIBTF) helps California workers who suffer a new workplace injury and already had a prior disability. It offers supplemental compensation when combined impairments severely limit earning capacity.