Key Takeaways:

• Amendments to Workers’ Compensation Law Section 24 now requires claimant attorneys follow a fee schedule.

• Moving forward, it is imperative to timely file the appropriate FROI/SROI forms now that judges, in approving attorney fees, must now consider “…the amount of the compensation awarded, having due regard for the financial state of the claimant.”

• The new changes went into effect Jan. 1.

As of January 1, the Workers’ Compensation Board has implemented new changes to attorneys’ fee request.

Previously, there was no specific methodology for the award of attorney fees, and granting a fee solely based on the amount of the award was impermissible. New amendments to Worker’s Compensation Law Section 24 reflects an about-face, as Section 24 will now require that claimant attorneys follow a fee schedule:

• One-third of one week’s compensation when an award is made directing the continuation of weekly compensation benefits for temporary total or temporary partial disability.
• Where an award is made that increases the amount of compensation
  awarded, or previously paid for periods of temporary total or
  temporary partial disability, the attorney’s fee shall be 15
  percent of the increased compensation.

• When an award is made for schedule loss of use, or permanent facial
  disfigurement, the attorney’s fee shall be 15 percent of the compensation due in excess of the employer or carrier’s previous payments.

• When an award is made for permanent total disability, or permanent partial
  disability, the attorney’s fee shall be equivalent to 15 percent of the compensation due in excess of the employer, or carrier’s, previous payments— plus a sum equivalent to 15 weeks of compensation at the rate fixed by the board.

• When an award is made pursuant to Section 32 agreement, the attorney’s fee shall be 15 percent of benefits. Benefits allocated for future medical expenses shall not be included in the calculation of the fee. However, if the attorney previously has been awarded a fee, any non-accrued balance of any attorney fees under the foregoing paragraphs shall be waived.

Board rule 12 NYCRR 300.17 formulated the specific procedures for any fee request, in addition to board rule 300.36 and 300.38. Previously, the provisions provided that no fee shall be approved when the attorney has failed to file and serve a Notice of Retainer and Appearance or Notice of Substitution, and no fee in excess of $450 shall be awarded to a claimant’s attorney if Form OC-400.1 is not accurately completed. The board amended these regulations to align with the newly enacted state law.

• 17 regulates notices of retainer, appearances, notice substitution and withdrawal, and fees of claimant’s attorney. This section has been significantly amended. No longer will the board be able to deny or reduce a requested fee for failure to file, or timely file, the required forms.
• Rule 300.36(j), which relates to the approval of Section 32 waiver agreements, is amended to require that all fees be awarded consistent with WCL § 24(2)(f), and to remove the provision indicating that an agreement may provide for “reasonable” fees.
• Rule 300.38(f), which regulates the controverted claims process, is amended to remove paragraph (5). There will no fee reduction for failure to timely file the pre-hearing conference, or filing an incomplete pre-hearing conference.
• For fee requests over $1,000, the attorney must submit the usual form OC-400.1. The attorney is no longer required to list, describe the services rendered, or the time spent in connection with those services. However, the attorney must provide the fee schedule employed in arriving at the fee requested.
• Conversely, for fees $1,000 or less, a claimant’s attorney is no longer required to submit the formal application. Instead, the attorney may make an oral application and certify on the record that the requested fee follows the applicable fee scheduled.

In approving attorney fees, the judge must now consider “…the amount of the compensation awarded having due regard for the financial state of the claimant…” (WCL § 24[2]). To that end, any awards previously paid to the claimant will be significant in determining the “financial state of the claimant.” It is imperative that adjusters timely file the required FROI or SROI forms to ensure that prior payments are properly reflected in the board file.

Form Changes:

There will be new forms OC-400, OC-400.1, C-32.1, and the RB-89 forms effective January 2, 2023. There will be a 60-day grace period for the RB-89 forms, after which the board will begin to exercise its discretion to deny review of appeals and rebuttals, which are based on the previous forms.

Client Advice

• Moving forward, it is imperative to timely file the appropriate FROI/SROI forms, as judges – in considering the proper attorney fees – must now consider “…the amount of the compensation awarded, having due regard for the financial state of the claimant.” Judges will now use the board file to review the prior awards made to the claimant. As such, clients should timely, and consistently, file the required FROI or SROI form to avoid any penalty.
• For future hearings, carrier’s attorney may be required to be adequately prepared with knowledge of the claimant’s prior awards. Therefore, clients should supply an updated amount of the claimant’s prior awards in advance of any hearings.

For more information or immediate guidance, please reach out to:

• Aaron T. Clarke
• Todd M. Jones
• Philip Unwin
• William V. Morrison
• Kristen L. Romano
• Damon M. Gruber
• Sean J. McKinley
• Esther F. Omoloyin
• Or another member of the firm’s Workers’ Compensation team