If you've been injured on the job and are considering hiring a workers' compensation attorney, it's important for you to understand the costs involved. Workers' compensation cases, like most personal injury cases, are generally handled on a contingency fee basis. That means that if you win your case, your attorney receives a percentage of your workers' compensation benefits or settlement. If you lose, there's no fee.
By eliminating the need for substantial up-front payments, contingency fee arrangements allow all injured workers, even those with limited financial resources, the chance to receive quality legal representation. They also provide a strong incentive for attorneys to obtain maximum benefits for their clients.
Attorneys' fees in workers' compensation cases are tightly regulated by state law. Every state places some sort of cap on the amount an attorney can charge, often 15% to 20% of the awarded benefits. In addition, legal fees generally must be approved by a workers' compensation judge or appeals board before the attorney collects a fee.
The laws and regulations dealing with attorney's fees vary from state to state, but most take into account the complexity of the case and the amount of benefits at issue in deciding how much an attorney may charge. In general, a case that is settled prior to an administrative hearing will warrant a lower percentage fee than one that requires a hearing or even a trial in circuit court.
In California, the workers' compensation judge authorizes a fee of 10%, 12%, or 15%, according to the complexity of the case. In Minnesota, an attorney may charge a fee of 25% of the first $4,000 won from the workers' comp insurance company, and 20% of the next $60,000, with a total cap of $13,000 per injury. New York law allows the judge or panel of judges in your case to determine the fee amount, which typically ranges from 10% to 20%. Workers' compensation attorneys in Missouri can charge a maximum of 25% of the weekly benefits or settlement.
Many states prohibit lawyers from charging fees for obtaining routine benefits, such as medical bills or lost wages, that are not disputed by the employer or insurer. No matter where you live, the attorney's fee will need to be approved by the workers' compensation judge or board before your attorney is paid.
In cases where an employer or insurer has engaged in egregious conduct or caused unnecessary delays, an attorney may request that the opposing side pay you an additional "penalty" amount or cover your attorney's fees. Penalty amounts paid by an insurance company or employer, while rare, usually aren't subject to the percentage caps found in state laws.
It never hurts to try to negotiate legal fees, but your chances of success will depend in large part on the strength of your case. Keep in mind that state laws generally prescribe the maximum your attorney may charge. You are free to ask your attorney to handle your case for less than the maximum allowed by law. Note that negotiation should be done prior to signing the representation agreement and fee agreement.
At your initial consultation, your attorney should provide you with a clear explanation of the fees you will be charged.
While most law firms will pay the costs of litigating your case up-front, you'll probably be required to reimburse the firm for these expenses if you win your case. Expenses are not covered by the standard fee agreement; they are an additional charge. Common expenses incurred over the course of a workers' compensation case include:
Make sure you understand precisely what the expense agreement covers, and try to get an estimate of the typical bill for expenses. Finally, note that some law firms charge for expenses even if you lose your case.
If you're thinking about filing a workers' compensation claim or if you've had a claim denied, contact an experienced attorney for a free consultation. An attorney often will be able to obtain far more benefits than an injured worker trying to navigate the system alone, even after the attorney's fee has been deducted.
Insurance companies and employers love when employees attempt to represent themselves in workers' compensation cases. Contacting an attorney to assist with your case will make it much more likely that you get the benefits you deserve. While you should be able to find a lawyer to give you a free initial consultation, you probably won't find one to take your case for free. (For more information, read Nolo's article on Is It Possible to Find a Workers' Comp Lawyer for Free.)