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Workers’ Compensation Reform Stalls

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On May 8, 2017, the Florida legislature closed its session without passing definitive legislation to address the past year’s court decisions. Two cases, Castellanos and Westphal, made sweeping changes to the state’s workers’ compensation system that could not be reconciled with existing law at the time. Since the legislature’s session has ended with no fix, it means at least a few more months before any agreement can be reached that will bring relief to claimants and recipients.

Disagreements Over Attorney Fees

The main point of contention between the House and Senate in deliberations was the question of attorney’s fees, which was one of the main issues faced in Castellanos. The case overturned a previously debated fee schedule which capped workers’ compensation attorney fees at an unreasonable limit – in Castellanos, the fee worked out for the plaintiff’s attorney under the old system came to $1.53 per hour – a patently unacceptable payout for a licensed professional’s hard work. The court held that such limits actively harmed claimants’ chances of receiving the compensation to which they are entitled, because the system has become so complex that the odds of being approved are very low if one does not engage (and pay) a competent attorney.

While this has generally been agreed upon by legislators, it cannot be ignored that high attorney fees harm small businesses, and can play a role in harming small businesses so badly that they become unable to offer workers’ compensation to their employees. To that end, the House and Senate both attempted to offer compromises on the amount of attorney fees that would be available in workers’ compensation cases, but were unable to reach one.

What This Means For Workers

Immediately, it means that the 14.5 percent rate increase approved by Florida’s Office of Insurance Regulation (OIR) last October will go into effect. This is a significant rate increase, relatively speaking, and it will be hard for some small businesses to absorb all at once. Indeed, observers from the National Council on Compensation Insurance (NCCI), the body that originally proposed the 14.5 percent hike, have stated that it is not unreasonable to expect further pressure to raise the rate if no legislative remedy is going to be forthcoming.

The most important thing to be aware of as an employee is that if your employer is placed in a difficult financial position by the rate hike, it may mean downsizing or cutting employee hours in order to meet the financial burden. While workers’ compensation insurance coverage is optional in some states or in some industries, it is mandatory in Florida aside from a few narrow exceptions, and as such, an employer cannot just decide not to cover its employees. The only financial decision left may be to reduce the workforce.

Contact An Orlando Workers’ Compensation Attorney

Since this rate hike may cause problems for many businesses, it means that employees will have to know their rights. Workers’ compensation is a complex field, but with an experienced attorney on your side, you have a better chance of obtaining the compensation you deserve. The Orlando workers’ compensation attorneys at the Hornsby Law Group are happy to try and answer your questions about the process and suggest a way forward. Contact our office today to set up an initial appointment.

Resources:

insurancejournal.com/news/southeast/2017/05/08/450191.htm

floridasupremecourt.org/decisions/2016/sc13-2082.pdf

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