The answer is “yes.” Any settlement you make in connection with a workers’ compensation claim under the Longshore and Harbor Workers’ Compensation Act (Longshore Act) must be approved by an authority at the Office of Workers’ Compensation Programs, Division of Longshore and Harbor Workers’ Compensation, which is under the Department of Labor.
A Settlement Needs Approval?
Why, you may ask, does a settlement to which you agreed need to be approved by a third party in the Department of Labor? Isn’t that just another layer of red tape and bureaucracy? Can’t you just rely on your attorney to make sure that the settlement is proper? Doesn’t that delay the payment of any settlement amount?
All those questions are valid. At first blush, it may seem like settlement approval is an annoying “red-tape”-type requirement. However, getting approval of a settlement you make is actually a helpful benefit to Longshore Act claimants. Having an experienced, yet neutral, third party review any settlement to which you agree will ensure your employer’s workers’ compensation carrier is not taking advantage of you.
So, what factors are considered by the Office of Workers’ Compensation Programs to make sure that the settlement is fair and appropriate? That is the subject of this blog.
Following a recent workers’ compensation case, the Office of Workers’ Compensation Programs has confirmed the rather rigorous set of requirements that Office of Workers’ Compensation Programs officials must review when passing on settlements that come before them.
Of course, if you are injured on the job, you are covered under the Longshore and Harbor Workers’ Compensation Act, and you are making a Longshore Act claim that may settle, you would be wise to consult with an experienced Longshore Act attorney.
We welcome you call us at Doolittle & Tucker, P.A., Florida Longshore Act attorneys at 904-396-1734. We have decades of experience handling workers’ compensation claims under the Longshore Act, and we want to use our experience as Florida Longshore Act attorneys to benefit you. Call today.
The Richardson Case
A good way to begin this discussion is by looking at the case that prompted the Office of Workers’ Compensation Programs to solidify their settlement review criteria.
A 52-year-old welder had worked for her employer for over 20 years. She unfortunately suffered a shoulder injury at work, rendering her unable to do her job. She was initially allowed to return to her employer to do light-duty work, and it quickly became apparent that she would never be able to do the work she did before her injury.
The employer helped the employee find a suitable alternative job, but she was not making nearly as much as she was making as a welder before her shoulder injury. So, her employer made voluntary payments to her of approximately $540 per week. As her claim was moving through the system, the employer and employee arrived at a settlement of $140,000.
In accordance with the Longshore Act, the parties then had to seek approval of that settlement amount with the Office of Workers’ Compensation Programs. The official reviewing the settlement rejected it as inadequate. It found that, given the appropriate formulae, a fair settlement amount would be closer to $306,000. The parties then appealed that decision to an Administrative Law Judge.
Once the employer added $500 per week to the proposed settlement amount, the ALJ approved the settlement. The ALJ made a distinction between claimants who are represented by a lawyer and those who are not.
With claimants who have a lawyer, the ALJ noted that he can look at the settlement with less scrutiny, because he can assume that the lawyer is behaving conscientiously and ethically. Further, the ALJ can assume that the lawyer took into account the issues with the claim in arriving at a settlement amount.
However, with claimants who are pro se, meaning those who are representing themselves without a lawyer, the ALJ maintained that he should scrutinize the settlement closely to make sure that the claimant is not disadvantaged.
Ultimately, the Benefits Review Board affirmed the ALJ’s decision in the Richardson case.
The Important Considerations for a Settlement
In the wake of Richardson, the Department of Labor issued a bulletin, reminding adjudicating officials of what must be considered when reviewing a workers’ compensation settlement.
First, the reviewing official has 30 days to approve a settlement, unless it is found that the settlement is “inadequate or procured by duress.” In fact, if both parties are represented by counsel, then the reviewing official’s silence after 30 days means that the settlement is approved.
Second, the document applying for settlement approval must have the following information:
- A description of the terms, indicating the amounts to be paid for compensation, medical, and attorney fees;
- The reason for the settlement, and the issues that are in dispute;
- The claimant’s identifying information;
- Information on the claimant’s current work status;
- A medical report on the claimant’s condition and need for future treatment;
- A statement on why the settlement should be considered adequate;
- If the settlement covers medical benefits, an itemization of the amount paid for medical expenses by year for the three years prior to the date of the application and an estimate of the claimant’s need for future medical treatment as well as an estimate of the cost of such medical treatment; and
- Information on any collateral source available for the payment of medical expenses.
Moreover, there are four main factors that the reviewing official must look to in order to determine the adequacy of a settlement, they are as follows:
- The claimant’s age, education, and work history;
- The degree of the claimant’s disability or impairment;
- The availability of the type of work the claimant can do; and
- The cost and necessity of future medical treatment, if any.
Florida Longshore Act Attorneys Can Help Get Your Workers’ Compensation Settlement Approved
Doolittle & Tucker, P.A. is a firm that focuses on Longshore Act cases. We care deeply about workers who are injured on the job, and about making sure that they receive all the benefits owed to them. Let us get you to where you need to go with your workers’ compensation settlement. Call us at Doolittle & Tucker, 904-396-1734.