In 1917, the Legislature substantially revised the existing law to meet problems that had arisen under the Boynton Act. The revised Workmen's Compensation Insurance and Safety Act of 1917 represented the full evolution of the workers' compensation system and became effective January 1, 1918. Once again liability for compensation was imposed on employers "without regard to negligence." Nevertheless, the 1917 Act continued to deny compensation for injuries resulting from the employee's own intoxication and, for the first time, also barred statutory benefits where the injury was intentionally self-inflicted. Although an employee's willful misconduct no longer totally precluded his or her recovery of all benefits, it reduced the workers' compensation award by 50 percent. Similarly, an employee injured as the result of the employer's serious and willful misconduct was not permitted to bring a civil damage action, but the workers' compensation award was increased by 50 percent.
Under this new Act, civil Court actions against employers were eliminated even in cases of the employer's gross negligence. Virtually the only kind of civil Court actions permitted, under the Act, were actions against uninsured employers and actions against third parties who injured employees. Third parties are generally parties outside of the employment relationship.
In the same month that the 1917 Act was approved, the Legislature, by joint resolution, recommended to the voters an amendment to California Constitution, Article XX section 21. The proposed amendment duplicated in large measure section 21 of the 1917 Act, and was intended to remove all doubts as to the constitutionality of the then existing workers' compensation laws. On November 5, 1918, the amendment was approved by the voters of California.
Since 1918, there have been many amendments to the workers' compensation law, most of which increased the benefits available to injured employees, and imposed penalties on illegally uninsured employers. Amendments have also substantially improved the delivery system.
The revised Workers' Compensation Insurance and Safety Act of 1917 is an expression of police powers of the state of California. See Labor Code section 3201, Alaska Packers Assn v. I.A.C. (Palmer) (1934) 1 Cal. 2d 250, 34 P.2d 716 (Published) and Graczyk v. W.C.A.B. (1986) 51 Cal.Comp.Cases 408 (Published).