What the panel ordered
The WCAB panel denied the defendant's Petition for Reconsideration, upholding the WCJ's finding that the defendant failed to prove that the personnel actions were lawful, nondiscriminatory, and in good faith, and therefore the psychiatric injury claim was compensable.
Defendant filed a Petition for Reconsideration of the WCJ's Findings of Fact & Order dated February 18, 2026, challenging the finding of compensable psychiatric injury and the application of Labor Code section 3208.3(h). The WCAB panel issued a decision on May 18, 2026, denying the petition and adopting the WCJ's Report and Recommendation.
What was disputed, and how it came out
Each issue the panel decided, with the reasoning it gave. An outcome is what this panel did on this record — not a rule, and not a prediction.
The WCJ found that the defendant failed to prove that the personnel actions, including the July 22, 2022 probationary release/demotion, were lawful, nondiscriminatory, and in good faith, which is required to sustain the Labor Code section 3208.3(h) defense. The WCAB panel adopted this reasoning and denied the defendant's petition.
From the decision · page 1Defendant seeks reconsideration of a workers' compensation administrative law judge's (WCJ) Findings of Fact & Order of February 18, 2026 wherein it was found that while employed during a cumulative period ending December 16, 2022, applicant sustained industrial injury to the psyche. In so finding, the WCJ found that defendant failed in its burden of showing that applicant's psychiatric injury was substantially caused by a lawful, nondiscriminatory, good faith personnel actions. (Lab. Code, § 3208.3, subd. (h).) Although the WCJ found that defendant proved that 25 percent of applicant's injury was caused by lawful, nondiscriminatory, good faith personnel actions, this fell short of the statutory minimum of 35%. (Lab. Code, § 3208.3, subd. (b)(3).)