ISSUE – District Directors, Part Two

Jack_crop 72dpiThis is a continuation of our discussion concerning the authority and responsibility of the U.S. Department of Labor’s District Directors in the adjudication/administration of claims under the Longshore Act.  Remember, references in the statute to the Secretary usually include his designee the District Director, and references to “Deputy Commissioner” mean either the District Director, the Administrative Law Judge, or both, depending on context.

Section 8(f) – This is the second injury provision.  It begins with the District Director.  Section 8(f)(3) provides that, “Any request (for second injury relief) filed after the date of enactment of (the 1984 amendments) for apportionment of liability to the special fund … for the payment of compensation benefits, and a statement of the grounds therefore, shall be presented to the deputy commissioner prior to the consideration of the claim by the deputy commissioner.  Failure to present such request prior to such consideration shall be an absolute defense to the special fund’s liability ….”

Comment:  If the employer/carrier is seeking to place a case in the Special Fund under Section 8(f) then they have to raise the issue when permanency first becomes an issue in the case or DOL will raise the absolute defense of section 8(f)(3).

Section 17 –  “Where a trust fund which complies with section 302(c) of the Labor-Management Relations Act of 1947 (29 U.S.C. 186(c)) established pursuant to a collective-bargaining agreement in effect between an employer and an employee covered under this Act has paid disability benefits to an employee which the employee is legally obligated to repay by reason of his entitlement to compensation under this Act or under a settlement, the Secretary shall authorize a lien on such compensation in favor of the trust fund for the amount of such payments.”

Section 18(a) – “In case of default by the employer in the payment of compensation due under any award of compensation for a period of thirty days after the compensation is due and payable, the person to whom such compensation is payable may, within one year after such default, make application to the deputy commissioner … for a supplementary order declaring the amount of the default ….”

Comment:  The Special Fund may pay an insolvency case.  It starts here with a default order.

Section 18(b) – “In cases where judgment cannot be satisfied by reason of the employer’s insolvency or other circumstances precluding payment, the Secretary of Labor may, in his discretion and to the extent he shall determine advisable after consideration of current commitments payable from the Special Fund … make payment from such fund upon any award made under this Act and in addition, provide any necessary medical, surgical, and other treatment required by section 7 of the Act ….”

Section 19(a) – “Subject to the provisions of section 13 a claim for compensation may be filed with the deputy commissioner … at any time after the first seven days of disability following any injury, or at any time after death, and the deputy commissioner shall have full power and authority to hear and determine all questions in respect of such claim.”

Section 19(b) – “Within ten days after such claim is filed the deputy commissioner … shall notify the employer and any other person (other than the claimant), whom the deputy commissioner considers an interested party, that a claim has been filed….”

Section 19(c) – “The deputy commissioner shall make or cause to be made such investigations as he considers necessary in respect of the claim, and upon application of any interested party shall order a hearing thereon….”

Section 21(a) – “A compensation order shall become effective when filed in the office of the deputy commissioner ….”

Comment:  This is important because the location of the District Director who “files” the Order usually determines which federal court of appeals the parties will end up in on appeal.  It is also important because it determines the effective date for subsequent events, such as appeals and when compensation is due and payable.

Comment:  “Filing” simply means the dating and receipt of an Order in the office of the District Director.  It does not include service on the parties.

Section 22 – This section permits modifications based on mistakes of fact or change in conditions within one year after the date of the last payment of compensation or within one year after the rejection of a claim, in any claim whether or not a compensation order has been issued.  The modification procedure begins with the District Director.

Section 28 – Attorney fees are awarded in appropriate cases for work done at each level of the adjudication process.  The District Director approves attorney fees for work done at the informal district office level, based on a fee petition showing the work performed and the hourly rate.  All attorney fees must be approved by DOL.

Section 30(e) – “Within ten days from the date of any injury, which causes loss of one or more shifts of work, or death … the employer shall send to the … deputy commissioner … a copy of a report ….”  This is the Form LS-202, Employer’s First Report of Injury.  There is a civil penalty of up to $11,000 per occurrence for failure to file the required report.

Section 31(b)(2)(A) – “The Secretary shall annually prepare a list of those individuals in each compensation district who have represented claimants for a fee in cases under this Act and who are not authorized to represent claimants.”

Comment – There is currently no list.

Section 33(f) – “If the person entitled to compensation institutes proceedings within the period prescribed in section 33(b) the employer shall be required to pay as compensation under this Act, a sum equal to the excess of the amount which the Secretary determines is payable on account of such injury or death over the net amount recovered against such third persons….”

Comment – The District Director determines the amount based on the net amount received by the injured worker in his third party suit..

Section 39(c)(2) – “The Secretary shall direct the vocational rehabilitation of permanently disabled employees …. “

Comment – District Directors have broad discretion here.

Section 49 (33 U.SC. section 948(a)) – “It shall be unlawful for any employer or his duly authorized agent to discharge or in any other manner discriminate against an employee as to his employment because such employee has claimed or attempted to claim compensation ….”

Comment – The District Directors handle discrimination complaints.

The District Directors, as well as the Claims Examiners, can be an excellent resource for both parties in the handling of a Longshore Act claim.

John A. (Jack) Martone served for 27 years in the U.S. Department of Labor, Office of Workers Compensation Programs, as the Chief, Branch of Insurance, Financial Management, and Assessments and Acting Director, Division of Longshore and Harbor Workers’ Compensation.  Jack joined The American Equity Underwriters, Inc. (AEU) in 2006, where he serves as Senior Vice President, AEU Advisory Services and is the moderator of the AEU Longshore Blog.

ISSUE: U.S. Department of Labor District Directors

Jack_crop 72dpiThe U.S. Department of Labor, which administers the Longshore and Harbor Workers’ Compensation Act, has a three step process for adjudicating claims.  The first step is informal proceedings at the district office level consisting primarily of dispute resolution services and medical management.  The next step, for unresolved, disputed issues, is a formal hearing at the Office of Administrative Law Judges (OALJ).  The third step is an appeal from the decision at the OALJ to the Benefits Review Board (BRB).

Each district office is managed by a District Director.  District offices are located in Boston, New York, Norfolk, Jacksonville, New Orleans, Houston, Long Beach, San Francisco, Seattle, and Honolulu.  In recent years offices in Chicago, Philadelphia, and Baltimore have been closed.

What does “dispute resolution services and medical management” mean?  What is the authority of the District Directors?  What do they do?  Here’s a briefly summarized list of the responsibilities and authority of the District Directors.

NOTE:  Where the Act says “Secretary (of Labor)” it includes the Secretary’s designee, the District Director.  Also, references to a “Deputy Commissioner” refer either to a District Director or to an Administrative Law Judge, depending on the context.

Section 6(b)(3) (33 U.S.C. 906(b)(3)) – “…. The Secretary shall determine the national average weekly wage….  Such determination shall be the applicable national average weekly wage for the period beginning with October 1 of that year and ending with September 30 of the next year….”

Comment: The national average weekly wage is used to set the maximum (twice the NAWW) and minimum (one-half the NAWW) weekly compensation rates under the Longshore Act.

Section 7(b) – “The employee shall have the right to choose an attending physician authorized by the Secretary to provide medical care under this Act …. The Secretary shall actively supervise the medical care rendered to injured employees, shall require periodic reports as to the medical care being rendered to injured employees, shall have authority to determine the necessity, character, and sufficiency of any medical aid furnished or to be furnished, and may, on his own initiative or at the request of the employer, order a change of physicians or hospitals when in his judgment such change is desirable or necessary in the interest of the employee….”

Comment: A physician “authorized by the Secretary” is any properly licensed physician who has not been barred from providing medical services under the Act.

Section 7(c)(1)(A) – “The Secretary shall annually prepare a list of physicians and health care providers in each compensation district who are not authorized to render medical care or provide medical services under this Act….”

There is currently no list.

Section 7(c)(2) –  “…. An employee may not change physicians after his initial choice unless the employer, carrier, or deputy commissioner has given prior consent to the change….”

Comment: The section goes on to say that such consent is always given when the initial choice of treating physician was not of a specialist whose services are necessary for proper care.  In all other cases a change may be made on a showing of good cause.

Section 7(d)(2) – “No claim for medical or surgical treatment shall be valid and enforceable against such employer unless, within ten days following the first treatment, the physician giving such treatment furnishes to the employer and the deputy commissioner a report of such injury or treatment, on a form prescribed by the Secretary.  The Secretary may excuse the failure to furnish such a report within the ten-day period whenever he finds it to be in the interest of justice to do so.”

Comment: The Secretary almost always finds it in the interest of justice to do so.

Section 7(e) – “in the event that medical questions are raised in any case, the Secretary shall have the power to cause the employee to be examined by a physician employed or selected by the Secretary ….  The Secretary shall have the power in his discretion to charge the cost of examination … to the employer, if he is a self-insurer, or to the insurance company which is carrying the risk, or in appropriate cases, to the Special Fund in section 44.”

Comment:  These so-called Impartial Medical Exams (IMEs) are very helpful to the parties, especially in disputed scheduled award cases.  They are routinely billed to the employer/carrier.

Section 7(f) – “An employee shall submit to a physical examination under subsection (e) at such place as the Secretary may require.  The place, or places, shall be designated by the Secretary ….”

Comment:  Frequently, disputed medical issues, as well as other issues such as average weekly wage under section 10, are resolved at Informal Conferences among the parties convened in the district offices and presided over by the District Director.

Section 8(i) – “Whenever the parties to any claim for compensation under this Act … agree to a settlement, the deputy commissioner or administrative law judge shall approve the settlement within thirty days unless it is found to be inadequate or procured by duress ….”

Comment:  The best way to close a case under the Longshore Act is to have an order issued by a District Director or ALJ approving a lump sum settlement under section 8(i).

Section 8(j)(2) –  Section 8(j)(2) provides that “An employee who (A) fails to report the employee’s earnings (on Form LS-200) … when requested, or (B) knowingly and willfully omits or understates any part of such earnings … forfeits his right to compensation with respect to any period during which the employee was required to file such report.  Section 8(j)(2) provides that “compensation forfeited under the subsection, if already paid, shall be recovered by a deduction from the compensation payable to the employee in any amount and on such schedule as determined by the deputy commissioner.”

The District Director determines in what amount and how quickly the employer recovers his overpayment.

Section 9(b) – With regard to survivor’s benefits, “… The deputy commissioner having jurisdiction over the claim may, in his discretion, require the appointment of a guardian for the purpose of receiving the compensation of a minor child….”

Section 9(g) –  “Compensation under this chapter to aliens not residents (or about to become nonresidents) of the United States or Canada shall be the same in amount as provided for residents, except that dependents in any foreign country shall be limited to surviving wife and child or children, or if there be no surviving wife or child or children, to surviving father or mother whom the employee has supported, either wholly or in part, for the period of one year prior to the date of the injury, and except that the Secretary of Labor may, at its option or upon the application of the insurance carrier, shall, commute all future installments of compensation to be paid to such aliens by paying or causing to be paid to them one-half of the commuted amount of such future installments of compensation as determined by the Secretary of Labor.”

Section 10(h)(1) – Under this section the Secretary determines the increase in weekly benefit amount in cases of permanent total disability or death effective each October 1, based on the change in the national average weekly wage determined under Section 6(b)(3).

Section 12(d) – “Failure to give such notice (30 day notice of injury) shall not bar any claim under this Act (1) if the employer (or his agent or agents or other responsible official or officials designated by the employer pursuant to subsection (c)) or the carrier had knowledge of the injury or death, (2) the deputy commissioner determines that the employer or carrier has not been prejudiced by failure to give such notice, or (3) if the deputy commissioner excuses such failure on the ground that (i) notice, while not given to a responsible official designated by the employer pursuant to subsection (c) of this section, was given to an official of the employer or the employer’s insurance carrier, and that the employer or carrier was not prejudiced due to the failure to provide notice to a responsible official designated by the employer … or unless objection to such failure is raised before the deputy commissioner at the first hearing of a claim for compensation ….”

Section 14(b) – “The first installment of compensation shall become due on the fourteenth day after the employer has been notified pursuant to section 12, or the employer had knowledge of the injury or death, on which date all compensation then due shall be paid.  Thereafter compensation shall be paid in installments, semimonthly, except where the deputy commissioner determines that payment in installments should be made monthly or at some other period.

Section 14(e) – If any installment of compensation payable without an award is not paid within fourteen days after it becomes due … there shall be added to such unpaid installment an amount equal to 10 per centum thereof, … unless such nonpayment is excused by the deputy commissioner ….”

Section 14(h) – “The deputy commissioner (1) may upon his own initiative at any time in a case in which payments are being made without an award, and (2) shall in any case where right to compensation is controverted, or where payments of compensation have been stopped or suspended, … make such investigations, cause such medical examinations to be made, or hold such hearings, and take such further action as he considers will properly protect the rights of all parties.”

Comment:  I believe that the powers of the District Directors to affect the conduct of a case are generally underestimated and under utilized.

Section 14(i) – “Whenever the deputy commissioner deems it advisable he may require any employer to make a deposit with the Treasury of the United States to secure the prompt and convenient payment of such compensation, and payments therefrom upon any awards shall be made upon order of the deputy commissioner.”

Comment:  This section is never used.

Section 14(g) – “Within sixteen days after final payment of compensation has been made, the employer shall send to the deputy commissioner a notice, in accordance with a form prescribed by the Secretary of Labor, stating that such final payment has been made, the total amount of compensation paid, the name of the employee and of any other person to whom compensation has been paid, the date of the injury or death, and the date to which compensation has been paid.  If the employer fails to so notify the deputy commissioner within such time the Secretary of Labor shall assess against such employer a civil penalty in the amount of $100.”

Comment:  The form prescribed by the Secretary is Form LS-208, Notice of Final Payment or Suspension of Compensation Payments.

Comment:  Effective November 11, 1997, the penalty amount is $110.00.

I’ll have to end Part One here, since I’m nowhere near finished.

ISSUE: Notes

Jack_crop 72dpiNOTE: Back on June 2, 2014, Royce Ray, AEU’s Director of Subrogation, posted a discussion with regard to the importance of photographs in support of subrogation efforts.

In my brief introduction to that piece, I mentioned that Royce was a CSRP (Certified Subrogation Recovery Professional). I don’t think that I did justice to the nature of this professional designation, or, for that matter, to the overall importance of subrogation to AEU’s operations. So I asked Royce to supplement. Here’s what he has to say:

“In my June 2, 2014, Blog on Photographs and Subrogation, Jack mentioned at the beginning of the article that I am a CSRP. But what is a CSRP, and what does it mean? Those are fair questions to ask when you are looking at the numerous advantages of being part of the ALMA program for your Longshore Act coverage.

A CSRP is a Certified Subrogation Recovery Professional. The CSRP designation is conferred by the National Association of Subrogation Professionals (NASP) on individuals who possess substantial industry experience and pass a comprehensive exam on subrogation investigation, management and recovery.

According to the NASP:

“The Certified Subrogation Recovery Professional (CSRP) designation is the professional designation for subrogation professionals. It is a statement that those possessing the designation have met stringent academic and experience requirements and have agreed to be bound by the Code of Professional Ethics of Certified Subrogation Recovery Professionals.”

I have been a CSRP since 2009. And, I am an experienced personal injury attorney, having practiced law for approximately 17 years prior to joining AEU in 2007 as the Director of Subrogation.

Having a dedicated Subrogation Unit headed by an attorney who is a CSRP is yet another reason why I feel as though AEU is the “go to” market for coverage under the Longshore Act.”

That’s better.

NOTE: John Chamberlain, who succeeded me at the U.S. Department of Labor and who is now doing business at, had an astute comment with regard to the current controversy in the state of Florida concerning the constitutionality of the state’s workers’ compensation law. As we know, the exclusions to Longshore Act coverage added by the 1984 amendment provisions of section 902(3)(A) – (F) contain a condition. To be excluded from Longshore Act coverage under these provisions the injured worker must be “subject to coverage under a State workers’ compensation law”. If Florida should find itself suddenly “between acts”, then all of the purportedly excluded workers would find themselves back under the Longshore Act because of the failure of the condition of state coverage. This also applies to the section 3(d) small vessel facility exemption.

Any employer in Florida who believes that they have employees who are excluded under the provisions of section 902(3)(A)-(F), or who have certified exempt as a small vessel facility should be watching developments very closely.


But at least I know that I’m not the only one who thinks that it’s fun to discuss “status” under the Longshore Act. Next time I’ll discuss two perennial “status” favorites: truck drivers and clerks.

NOTE: The U.S. Department of Labor (DOL) has closed its Baltimore district office. DOL announced Industry Notice No. 146 on August 25, 2014. The Longshore Baltimore district office will close on September 30, 2014. The former Fourth Compensation District will be consolidated with the Fifth Compensation District located in Norfolk, VA. As part of the transition, effective September 1 the Norfolk office has jurisdiction over past and future cases arising in Delaware, Maryland, Pennsylvania, Virginia, West Virginia and the District of Columbia. The physical address for the Norfolk office is: U.S. Department of Labor, Office of Workers’ Compensation Programs, Division of Longshore and Harbor Workers’ Compensation, Federal Building, Room 212, 200 Granby Mall, Norfolk, VA 23510. The telephone number is 757-441-3071.

In accordance with previous DOL instructions, centralized reporting of all new cases goes to the New York district office. After a case has been created, all mail should still be sent to the Jacksonville district office.

So Baltimore joins Philadelphia and Chicago as closed Longshore district offices.