Greetings,

(Technically the JCC’s do not “approve” represented settlements in FL, they approve the amount of attorney fees and child support arrearage, but you know what I mean…)

Over the last several months there has been a distinct push by the Judges of Compensation Claims to be more discerning on approving claimant’s attorney fees.   At first glance, from the Employer/Carrier perspective, you want to say “good”!  However, I think the result has been to keep files open longer, increase litigation and increase defense costs. 

if you are attending WCI in a few weeks, I am speaking on this topic on a panel with two JCC’s, two claimant’s attorneys and another defense attorney, 10:15 am, Tuesday 8/20, Attorney Breakout, Crystal Ballroom M.  (If you are not attending WCI and need credits or the 4 hour ethics class, sign up for our webinars below or visit https://eraclides.com/events/ )

There are two scenarios where I am seeing the JCC’s deny a claimant’s attorney fee.   First, if there is a joint stipulation where they are taking a “side fee” out of the settlement for securing a benefit.  The JCC’s are requiring proof that benefit was provided, and scheduling evidentiary hearings on some for that purpose.  The second situation is where a JCC makes the claimant’s attorney prove they have spent enough hours for their 25% Miles fee to be “reasonable”.  This actually encourages litigation to justify their fees.

If the JCC denies approval of the claimant’s attorney fees, it makes the case stay open longer and incur additional defense costs.  On the front end, I am seeing some claimant’s attorneys being hesitant to settle claims as quickly because they don’t have the hours to justify their fees.  

While I am sure the intent is to make sure claimant’s are not taken advantage of and also, as an ancillary, reduce litigation, I do not think it accomplishes either.  Claimant’s now have to wait weeks or months longer to get their settlement funds in some cases.   And year to date, there have been 18,528 litigated work comp cases in Florida, basically the same as last year over that timeframe.  It is not reducing litigation.  Claims are not settling for less because the claimant attorney thinks a higher fee will not get approved.  While the intent may be good, the result in my opinion is costing us more.  In the big picture, as long as we feel the total settlement was a good deal for us, the E/C really has no stake in the breakdown between the claimant and their attorney.

At the panel discussion, I have some suggestions, that hopefully can get adopted into practice to help this situation.

• If it is a Miles fee issue where there is a question of the reasonableness of the 25% fee from claimant’s settlement, the JCC’s can issue an order approving the settlement with just the statutory guideline fee.   We can issue the entire settlement and close the file, and if the claimant attorney wants to hold an amount in trust and argue for a higher fee, it can happen after we are out of the case.   You don’t need to pay me to sit through that or keep the reserves open, our file is paid and closed.

• If it is a joint stipulation “side fee” for securing the benefit, it can really be handled the same way.  The JCC approves the total settlement, including the dollars on the stipulation.   A hearing can be held afterwards to see if the claimant or the claimant’s attorney gets some or all of that fee.  On these, defense may have to participate in the hearing, but the case is settled and there may be one final defense bill.

If anyone sees any other possible solutions, please reach out to me.  I am hopeful that some positive change will come of this panel.

Sincerely,

Morgan Indek | Managing Partner