House Panel Approves Workers’ Compensation Changes

House Panel Approves Workers’ Compensation Changes

Following a spirited debate, the Insurance & Banking Subcommittee approved a measure that would reconfigure the workers’ compensation system in Florida.

Much of the discussion about PCB IBS 17-01 centered on attorneys’ fees, which under the approved 34-page bill, could be as high as $250 an hour. Business groups insisted that a rate that high would drive up employer costs, therefore discouraging existing businesses from relocating to the Sunshine State and creating insurmountable financial barriers for new ones. Subcommittee Chairman Danny Burgess (R-Zephyrhills) defended the provision as the only way that the new bill could pass judicial muster. To placate business groups and counter what he called the “atomic bomb effect” of Castellanos v. Next Door Company, Jay Fant (R-Jacksonville) proposed an amendment that would have ended the “loser pays” attorneys’ fees system, forcing injured workers to pay their own legal fees even if the insurance company fights the claim and loses. Some lawmakers objected that the addition would make it almost impossible for the “little guy” to fight the “big guy,” and the amendment failed on an 8-7 vote. The bill addresses other issues as well, such as the length of benefits and the amount of medical reimbursement.

There is a companion bill in the State Senate, but lawmakers have yet to hold hearings or workshops on S.B. 1582.

Workers’ Compensation Costs

Much of the current predicament dates back to 2005, when lawmakers enacted comprehensive reforms to “fix” workers’ compensation, and in the minds of most lawmakers, that meant reducing costs to businesses.

The logical way to reduce litigation expenses would have been to streamline the system and expedite claims, thus naturally suppressing attorneys’ fees. Instead, lawmakers chose to address costs by legislative fiat, and any time any lawmaker tries to force artificial changes to an organic system, the experiment often ends badly.

The attorneys’ fees limit may have been couched as a way to reduce costs, but its true impact was much different. Instead of compensating attorneys by the hour, the 2005 law gave lawyers a percentage of the recovery, no matter how long they worked to achieve that outcome. As a result, victims who had claims that included thorny legal or factual issues found it almost impossible to find aggressive and experienced representation.

Everything came to a head in 2016’s Castellanos v. Next Door Company. Because the judge could only consider the monetary amount of the claim and not the hours worked, an attorney received $1.53 an hour after a particularly complicated case. The Florida Supreme Court observed that “the workers’ compensation system has become increasingly complex to the detriment of the claimant, who depends on the assistance of a competent attorney to navigate the thicket.” The majority called the irrebuttable presumption “an issue of serious constitutional concern given the critical importance, as a key feature of the workers’ compensation statutory scheme, of a reasonable attorney’s fee for the successful claimant.”

In other words, according to the Supreme Court, injured workers stand little chance of receiving fair compensation without an attorney, and since the insurance company has nearly limitless resources with which to fight the claim, a equally good lawyer on the other side is the only way to balance the scales.

Benefits Available

Because of Castellanos, victims now have a chance to obtain fair compensation for their job-related injuries. These injuries usually fall into one of two categories:

  • Trauma Injury: Slip-and-fall injuries usually account for the most days of missed work in these cases. Other common trauma injuries include motor vehicle crashes, falls from a height, and electrocutions.
  • Occupational Disease: Joint pain, hearing loss, repetitive stress disorder, and respiratory problems all occur gradually over time, and if the victims link these conditions to their jobs, they are eligible for compensation.

Largely because of the eggshell skull rule, injured victims are normally entitled to full benefits if they establish that a workplace injury was responsible for at least 50% of their medical problem or monetary damages.

In these injury situations, workers’ compensation pays cash benefits that cover economic losses, such as medical bills and lost wages. Both these losses are fully covered, so injured victims are entitled to two-thirds of their average weekly wage until they recover and the victim is not responsible for any unpaid medical bills.

To start your claim for damages, partner with Barnett, Lerner, Karsen & Frankel today.