By Gary Blankenship
Fees would be capped at $150 an hour for attorneys representing claimants in workers’ compensation cases, and carriers and employers could request a separate review of those fees under a bill passed by the Florida House.
However, the Senate Appropriations and Rules committees passed a much different bill that capped claimant attorneys’ fees at $250 an hour and lacked many other provisions of the House legislation.
The bills address recent Supreme Court rulings that held unconstitutional parts of the workers’ compensation law setting limits on claimants’ attorneys’ fees and limiting payments to two years for totally and partially disabled workers who were expected to eventually recover.
Debate in House committees and on the floor left little doubt that higher claimant attorneys’ fees were getting the most blame for a 14.5 percent hike in workers’ compensation rates that followed the Supreme Court’s rulings last year.
The House measure, HB 7085, passed 82-37 on April 19. Later that day, the Senate Rules Committee approved SB 1582, sponsored by Sen. Rob Bradley, R-Orange Park, by a 10-0 vote.
A 2003 amendment to the workers’ compensation law set attorneys’ fees as a percentage of benefits won for the client. The Supreme Court found the strict schedule was unconstitutional unless it allowed a reasonable departure if the attorney had to spend an inordinate amount of time to win a small benefit. In 2009, the Legislature amended the law to prohibit any departure, reasonable or not, from the schedule.
Last year the court found that unconstitutional, saying it violated due process guarantees because it discouraged attorneys from taking cases where the award might be modest. In a separate case, it struck down a two-year limit in temporary disability benefits.
The court opinions were cited as the reason for a 14.5 percent hike this year in workers’ compensation rates.
Bradley said the main differences between the chambers was the Senate capping plaintiff attorneys’ fees at $250 an hour, while the House set the rate at $150, imposed some other requirements, and cut reimbursement rates for hospitals. Bradley’s bill also would have carriers individually seek approval for rates rather than using the current group rating system that has companies basically charging the same rate. The House, both in committee and on the floor, rejected amendments to use that system. It also rejected the higher attorneys’ fee rate.
“I believe between now and the end of the session we can bridge the difference between the House and Senate bills on attorney fees,” Bradley said. He added that although he was concerned the House bill takes “more out of the hide of the hospitals,” which could hurt their financial stability, that an agreement is possible there, too.
The House bill, sponsored by Rep. Danny Burgess, R-Zephyrhills, re-establishes a reasonable departure for attorneys’ fees, but caps the hourly rate for that departure at $150, which he said is the typical rate paid to lawyers representing employers and carriers in workers’ comp cases. Opponents questioned the fairness of that rate, since plaintiff attorneys will get paid only if they win, while defense firms get paid whether they win or not.
The amended bill makes several other changes on how claimant attorneys are paid:
• The judge of compensation claims must determine that the claimant and his or her attorney made a good-faith effort to resolve their case before litigation. If the judge determines such an effort was not made, sanctions may be imposed, including paying the employer/carriers’ attorneys’ fees.
• The claimant’s attorney must file with the court and serve on “all interested parties,” both five days before the pretrial hearing and five days before the final hearing, the hours expended to date, including allocating the number of hours for each benefit claimed. A similar requirement is imposed when the claimant is following an expedited procedure for smaller claims.
• Retainer agreements, previously unreviewable by a judge of compensation claims, must be filed with the Office of the Judges of Compensation Claims.
• Judges can only depart from the fee schedule in the law if that fee is less than 40 percent or greater than 125 percent of the fee customarily paid to defense lawyers. Payment must be made only on issues where the claimant prevailed and may not exceed $150 per hour.
• The employer/carrier may seek an independent review of any departure fee award by asking a second judge of compensation claims to review the award within 20 days. This provision does not apply to settled cases or if there is a stipulation on attorneys’ fees.
• In response to a First District Court of Appeal opinion holding unconstitutional the statute prohibiting injured workers from paying their workers’ comp attorneys, the bill requires a notice in all plaintiff/attorney contracts, in 14-point, bold type, that the workers’ comp law requires the injured worker to pay his or her own attorneys’ fees, and that the employer/carrier will only pay those fees in certain circumstances. Even in those cases, the required disclaimer says in all caps: “YOU MAY BE RESPONSIBLE FOR PAYING ATTORNEY FEES IN ADDITION TO ANY AMOUNT THE EMPLOYER OR THEIR CARRIER MAY BE REQUIRED TO PAY, DEPENDING ON THE DETAILS OF YOUR AGREEMENT WITH YOUR ATTORNEY OR REPRESENTATIVE.”
The bill also extended benefits of temporarily disabled workers from 104 to 260 weeks, which the court did in its order in that case.
Opponents warned the $150 cap and required disclaimer would not pass constitutional muster.
Bradley said his bill would provide a “small to moderate decrease” in the 14.5 percent hike in workers’ compensation rates, while the House bill would yield a slightly bigger reduction.
The Senate measure also maintains reimbursement rates to hospitals. Bradley said those rates are cut in the House bill and that in turn would hurt hospitals, which are the largest employers in many communities.
Business and insurance lobbyists voiced support for the House bill and opposition to the Senate bill in the respective meetings.
“Merry Christmas to the industry because they get rate reductions, and Merry Christmas to the employers,” said Rep. Sean Shaw, D-Tampa, during the House debate. “What do the injured workers get? They get a lump of coal.”
But Rep. Bill Hager, R-Boca Raton, called it an “outstanding” bill that conformed to the Supreme Court decisions. “Rep. Burgess has delivered on his responsibility, and that responsibility is public policy that is balanced and fair,” he said.