In 2015, direct workers’ compensation fees cost US employers $1 billion per week. That sums up to a staggering $4 billion each month for direct workers’ comp expenses alone.
As if that’s not bad enough, those figures don’t cover the losses from lost productivity. Meaning, the overall costs of workplace injuries could be way higher.
Despite all that, work injuries still cost US employers an estimated $170.8 billion in 2018.
If you’ve had a job injury or illness yourself, you should talk to a workers’ compensation attorney. This is especially crucial if your health suffered a lot, and you need extended treatment. A lawyer may be able to help you secure a larger settlement amount.
To that end, we’ve curated this guide about workers’ comp attorney fees. Read on so you know how they get paid and how much you can expect to pay them.
A Few Terminologies to Keep in Mind
Before we talk about workers compensation attorney fees, we need to go over some terms first. This way, you can better understand the jargon used in the legal world.
First is “claimant”, the term used to refer to the person who files the workers’ comp claim. This is you, the injured worker entitled to receive benefits.
If you must file a legal case or lawsuit, then you become a “plaintiff”. In workers’ comp claims, plaintiffs are still the injured individuals. However, this term is usually for claimants who bring their cases to courts as lawsuits.
The term “defendant”, by contrast, refers to the individual or company sued by the plaintiff. If you’ve filed a lawsuit against your employer, then your employer is the “defendant” in this case.
Why Pursue a Workers’ Compensation Lawsuit?
Workers’ compensation exists to protect both employers and employees. It benefits employers by protecting them against personal injury lawsuits filed by workers. In turn, workers benefit as they receive prompt financial help if they get injured on the job.
Still, there are at least seven instances wherein workers can sue outside of workers’ comp.
Suppose that your employer causes intentional harm to you, the worker. If you sustain severe injuries after this, then you can file a lawsuit against your employer. In this case, you’d need to pursue a personal injury lawsuit.
Another example is if an employer failed to abide by health and safety laws. If you can prove that this failure was intentional, you can also sue outside of workers’ comp.
You may also be able to file a lawsuit if your employer denies your valid claim. Although not all the time, employers and insurers can reject workers’ comp claims. For instance, in 2017, the rate of claims denials reached a staggering 7%.
The thing is, many of these were valid, and so they were later overturned and approved. In any case, you can file a lawsuit if your valid workers’ comp claim gets denied.
There are just a few examples of how workers’ comp claims can become lawsuits. A workers’ comp attorney can help you determine if your case should go to court. If there’s not enough to bring it to court, your lawyer can still help by ensuring you get fair compensation.
How Workers’ Compensation Attorneys Get Paid
Most workers’ compensation lawyers work on a “contingency fee” basis. This means that the attorney’s payment will come from the claimant’s settlement. If the lawyer wins the case, then a part of the claim “winnings” will pay for the rendered legal services.
If the workers’ compensation lawyer doesn’t win the case, then there’s usually no fee. However, the claimant or plaintiff may still have to pay for some other costs. These may include court filing fees, copy costs, and payments to witnesses.
Contingency fee arrangements benefit both the claimant/plaintiff and the attorney. For starters, these let injured workers get legal representation with no upfront costs. This, in turn, provides them the opportunity to receive decent legal representation.
Lawyers, on the other hand, benefit by expanding their portfolio of handled cases. By taking on claimant/plaintiff cases, they also gain more experience. This, in turn, can help them attract more clients in the future.
Of course, attorneys also have the incentive of getting a bigger payout if they win the case. As such, personal injury lawyers strive hard to win claims and lawsuits for their clients.
Average Rates Charged By Workers’ Comp Lawyers
On average, workers’ comp attorney fees can be 10% to 20% of the settlement amount. Meaning, if the settlement amount is $20,000, the claimant/plaintiff pays the lawyer $2,000 to $4,000. Again, all these payments will come from the amount paid by the defendant.
Do note that the exact percentage that workers’ comp lawyers can charge vary from state to state. State laws, after all, have tight control over how much attorneys can charge their clients. These regulations are in place to also protect injured workers.
Here are a few examples of how workers’ comp fees work in some states.
The Hoosier State
In Indiana, workers’ comp lawyers can charge no more than 20% of a settlement that doesn’t exceed $50,000. For recoveries that go beyond $50,000, attorneys can charge up to 15%.
So, let’s say that an injured Indiana worker receives a settlement for $20,000. In this situation, the workers’ comp lawyer fees can cost up to $4,000. If the claimant/plaintiff wins $75,000, then the attorney can get paid up to $11,250.
The Sunshine State
In Florida, workers’ compensation attorneys can charge up to 20% of the first $5,000 of recovery. This means that the lawyer’s payment can amount to no more than $1,000.
For the next $5,000, the attorney can require claimants/plaintiffs to pay 15%. So, if the total settlement amount is $10,000, the lawyer’s overall cost could be $1,750.
Injured workers in FL may also have to pay more depending on their future settlements.
The Golden State
In the Golden State, a workers’ comp judge has the power to approve how much the attorney’s fees can be. In disability cases, this usually ranges from 9% to 12%. However, a judge may approve a higher rate if the case is quite complex.
The Lone Star State
In Texas, the Division of Workers’ Compensation is the one that approves a lawyer’s rates. Moreover, it sets a maximum reasonable hourly rate for workers’ comp lawyers, which is $200. For legal assistants, the max is $65.
However, injured workers in Texas aren’t the ones who pay for the attorneys themselves. It’s the workers’ comp insurance carrier of the employer who does. They use part of the income benefits of the injured worker to pay the attorney.
The Empire State
In New York, a workers’ comp judge also determines how much an attorney can charge. The fees then get deducted from the workers’ benefits, so long as the lawyer wins the case.
If the attorney loses the case, the claimant/plaintiff won’t have to pay the lawyer fees. However, the injured worker may still have to pay for the costs of the legal services. These are the “other costs” mentioned above, such as court filing fees.
Getting an Initial Lawyer Consultation for Free
Most workers’ comp attorneys also provide a free initial consultation. These meetings usually run for at least half an hour.
Lawyers use this as an opportunity to assess if the claimant’s case requires an attorney. They also take this as the chance to verify if there’s a possibility of taking the case to trial. If there are grounds for a lawsuit, then the attorney will gauge how meritable the case is.
As an injured worker, you should also use this as an opportunity to get legal advice. Even if your case doesn’t have to go to trial, an attorney can still help you maximize your settlement.
Remember: workers’ comp lawyers get paid more if they win a larger amount for you. As such, they will do everything in their power to win their clients’ cases.
Negotiating Workers’ Comp Lawyer Fees
During your initial consultation, the lawyer will explain all the fees you may have to pay. In states wherein there are “caps” to attorney fees, you can expect lawyers to charge up to the highest they can. Still, this doesn’t mean that you can no longer negotiate a lower rate.
You can still try to ask the attorney if they can charge you something lower. Of course, your reason should be viable, such as if you’re really on a tight budget. If your attorney does accept a lower rate, be sure this goes into writing.
Focus on Your Recovery With the Help of a Workers’ Comp Attorney
Not all claims require a workers’ compensation attorney. However, in cases of severe injuries or illnesses, a lawyer can be of invaluable help.
Besides, workers’ comp attorney fees are reasonable, and you don’t even have to pay them right away. However, your lawyer will still do most of the legwork of the claims or lawsuit process for you. That should be enough reason to hire an attorney so you can focus on your recovery.
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