Morgan’s Tip of the Week- Settlement Checks

Greetings, I have received a few questions recently about when settlement checks are due to avoid a late payment, and a resulting 20% penalty and interest.  

The statute under 440.20(11)(c) states payment must be made within 14 days after the JCC “mails” the order approving attorney fees.   We often mistakenly refer to it as the JCC “approving the settlement” for a represented claimant.  In actuality, the JCC only confirms that child support is accounted for, and approves the claimant’s attorney fees, not the overall amount of the settlement.  So, the statute gives you 14 days to issue the check after the date the JCC signs the order on fees.  It uses the word mail, but in practice because of the electronic filing, it is the same day at this point. 

On an unrepresented claimant, the JCC does approve the settlement amount as being in the claimant’s best interests, but the same 14 days to pay applies.

The payout ledger must show that the check was issued within 14 days of the approval date.  Do not wait on issuing the settlement check, if there is a delay between you processing the check  in the system and the date on the payout it could be deemed late, with a 20% penalty. 

We always try and negotiate for a longer window for you to pay, typically 30 days.   Many opposing counsels will not agree to that however and we are stuck with the 14 days .  My office will make sure you know whether you have 14 or 30 days.

And just as an aside, when we say we settle a claim with “7/7/7 language” it does not affect when the payment is due.  That is 7 days for us to send the paperwork to opposing counsel, 7 days for them to return the paperwork to my office and then 7 days for us to e-file the paperwork with the JCC.  It does not affect the 14 days to pay after JCC approval of the order on fees.

Here is the statute on 14 days:

440.20 (11)(c) Notwithstanding s. 440.21(2), when a claimant is represented by counsel, the claimant may waive all rights to any and all benefits under this chapter by entering into a settlement agreement releasing the employer and the carrier from liability for workers’ compensation benefits in exchange for a lump-sum payment to the claimant. The settlement agreement requires approval by the judge of compensation claims only as to the attorney’s fees paid to the claimant’s attorney by the claimant. The parties need not submit any information or documentation in support of the settlement, except as needed to justify the amount of the attorney’s fees. Neither the employer nor the carrier is responsible for any attorney’s fees relating to the settlement and release of claims under this section. Payment of the lump-sum settlement amount must be made within 14 days after the date the judge of compensation claims mails the order approving the attorney’s fees. Any order entered by a judge of compensation claims approving the attorney’s fees as set out in the settlement under this subsection is not considered to be an award and is not subject to modification or review. The judge of compensation claims shall report these settlements to the Deputy Chief Judge in accordance with the requirements set forth in paragraphs (a) and (b). Settlements entered into under this subsection are valid and apply to all dates of accident.

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Morgan Indek | Managing Partner