DAR File No. 40803
This rule was published in the October 15, 2016, issue (Vol. 2016, No. 20) of the Utah State Bulletin.
Labor Commission, Adjudication
Section R602-2-4
Attorney Fees
Notice of Proposed Rule
(Amendment)
DAR File No.: 40803
Filed: 09/20/2016 09:04:55 AM
RULE ANALYSIS
Purpose of the rule or reason for the change:
The purpose of this filing is to remove Section R602-2-4 regarding the payment of attorney fees.
Summary of the rule or change:
This rule change strikes the provisions regulating the payment of attorney fees in workers' compensation cases.
Statutory or constitutional authorization for this rule:
- Section 63G-4-102 et seq.
- Section 34A-1-301 et seq.
Anticipated cost or savings to:
the state budget:
There should be no cost or savings to the state budget as attorney fees are paid out of injured workers' benefits.
local governments:
There should be no cost or savings to the local government as attorney fees are paid out of injured workers' benefits.
small businesses:
There should be no cost or savings to the small businesses as attorney fees are paid out of injured workers' benefits.
persons other than small businesses, businesses, or local governmental entities:
There may be an increased cost to injured workers. Attorney fees are paid out of injured workers' benefits. Given that the Supreme Court found the Commission's regulation of attorney fees to be unconstitutional, injured workers may pay more of their award in attorney fees. The exact cost to injured workers is unknown as each injured worker will pay the injured worker's attorney pursuant to the individual fee agreement between the injured worker and the attorney. The cost will vary in each case.
Compliance costs for affected persons:
There should be no compliance costs for affected persons as attorney fees are paid out of injured workers' benefits.
Comments by the department head on the fiscal impact the rule may have on businesses:
The Utah Supreme Court issued its decision in Injured Workers Assoc. of Utah v. State of Utah, 2016 UT 21, on 05/18/2016. The Court found Utah Code Section 34A-1-309, the statutory provision that required the Utah Labor Commission to regulate attorney fees in workers' compensation cases, to be unconstitutional. The Court also found in Subsection R602-2-4(C)(3), the administrative rule that governs and regulates the payment of attorney fees, to be unconstitutional. The rule places the Commission in violation of the Court's decision and will likely confuse practitioners, injured workers, employers, and insurance carriers. Moreover, all of Section R602-2-4 should be removed, not merely Subsection R602-2-4(C)(3). The rule governs the payment of attorney fees and costs. The Commission's sole authority to regulate attorney fees was contained in Section 34A-1-309. Inasmuch as the statute has been found to be unconstitutional, the Commission lacks the authority to enforce the remaining provisions of the rule. Also, the Commission lacks the authority to regulate or enforce the payment of costs.
Jaceson R Maughan, Acting Commissioner
The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:
Labor CommissionAdjudication
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY, UT 84111-2316
Direct questions regarding this rule to:
- Heather Gunnarson at the above address, by phone at 801-536-7928, by FAX at 801-530-6333, or by Internet E-mail at [email protected]
- Jaceson Maughan at the above address, by phone at 801-530-6036, by FAX at 801-530-6390, or by Internet E-mail at [email protected]
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
11/14/2016
This rule may become effective on:
11/22/2016
Authorized by:
Jaceson Maughan, Acting Commissioner/General Counsel
RULE TEXT
R602. Labor Commission, Adjudication.
R602-2. Adjudication of Workers' Compensation and Occupational Disease Claims.
[R602-2-4. Attorney Fees.
A. Pursuant to Section 34A-1-309, the Commission adopts
the following rule to regulate and fix reasonable fees for
attorneys representing applicants in workers' compensation or
occupational illness claims.
1. This rule applies to all fees awarded after July 1,
2015.
2. Fees awarded prior to the effective date of this rule
are determined according to the prior version of this rule in
effect on the date of the award.
B. Upon written agreement, when an attorney's
services are limited to consultation, document preparation,
document review, or review of settlement proposals, the attorney
may charge the applicant an hourly fee of not more than $125 for
time actually spent in providing such services, up to a maximum
of four hours.
1. Commission approval is not required for attorneys fees
charged under this subsection B. It is the applicant's
responsibility to pay attorneys fees permitted by this subsection
B.
2. In all other cases involving payment of
applicants' attorneys fees which are not covered by this
subsection B., the entire amount of such attorneys fees are
subject to subsection C. or D. of this rule.
C. Except for legal services compensated under subsection
B. of this rule, all legal services provided to applicants shall
be compensated on a contingent fee basis.
1. For purposes of this subsection C., the following
definitions and limitations apply:
a. The term "benefits" includes only death or
disability compensation and interest accrued thereon.
b. Benefits are "generated" when paid as a
result of legal services rendered after Adjudication Form 152
Appointment of Counsel form is signed by the applicant. A copy of
this form must be filed with the Commission by the
applicant's attorney.
c. In no case shall an attorney collect fees calculated
on more than the first 312 weeks of any and all combinations of
workers' compensation benefits.
2. Fees and costs authorized by this subsection shall be
deducted from the applicant's benefits and paid directly to
the attorney on order of the Commission. A retainer in advance of
a Commission approved fee is not allowed.
3. Attorney fees for benefits generated by the
attorney's services shall be computed as follows:
a. For all legal services rendered through final
Commission action, the fee shall be 25% of weekly benefits
generated for the first $25,000, plus 20% of the weekly benefits
generated in excess of $25,000 but not exceeding $50,000, plus
10% of the weekly benefits generated in excess of $50,000, to a
maximum of $18,590.
b. For legal services rendered in prosecuting or
defending an appeal before the Utah Court of Appeals, an
attorney's fee shall be awarded amounting to 30% of the
benefits in dispute before the Court of Appeals. This amount
shall be added to any attorney's fee awarded under subsection
C.3.a. for benefits not in dispute before the Court of Appeals.
The total amount of fees awarded under subsection C.3.a. and this
subsection C.3.b. shall not exceed $26,819;
c. For legal services rendered in prosecuting or
defending an appeal before the Utah Supreme Court, an
attorney's fee shall be awarded amounting to 35% of the
benefits in dispute before the Supreme Court. This amount shall
be added to any attorney's fee awarded under subsection
C.3.a. and subsection C.3.b. for benefits not in dispute before
the Supreme Court. The total amount of fees awarded under
subsection C.3.a, subsection C.3.b. and this subsection C.3.c
shall not exceed $32,913.
D. The following expenses, fees and costs shall be
presumed to be reasonable and necessary and therefore
reimbursable in a workers' compensation claim:
1. Medical records and opinion costs;
2. Deposition transcription costs;
3. Vocational and Medical Expert Witness fees;
4. Hearing transcription costs;
5. Appellate filing fees; and
6. Appellate briefing expenses.
F. Other reasonable expenses, fees and costs may be
awarded as reimbursable as the Commission may in its discretion
decide in a particular workers compensation claim.
E. In "medical only" cases in which awards of
attorneys' fees are authorized by Subsection 34A-1-309(4), the
amount of such fees and costs shall be computed according to the
provisions of subsection C and D.]
KEY: workers' compensation, administrative procedures, hearings, settlements
Date of Enactment or Last Substantive Amendment: [July 8, 2015]2016
Notice of Continuation: June 19, 2012
Authorizing, and Implemented or Interpreted Law: 34A-1-301 et seq.; 63G-4-102 et seq.
Additional Information
More information about a Notice of Proposed Rule is available online.
The Portable Document Format (PDF) version of the Bulletin is the official version. The PDF version of this issue is available at https://rules.utah.gov/publicat/bull-pdf/2016/b20161015.pdf. The HTML edition of the Bulletin is a convenience copy. Any discrepancy between the PDF version and HTML version is resolved in favor of the PDF version.
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For questions regarding the content or application of this rule, please contact Heather Gunnarson at the above address, by phone at 801-536-7928, by FAX at 801-530-6333, or by Internet E-mail at [email protected]; Jaceson Maughan at the above address, by phone at 801-530-6036, by FAX at 801-530-6390, or by Internet E-mail at [email protected]. For questions about the rulemaking process, please contact the Office of Administrative Rules.