AEU Longshore Blog ISSUE: Annual Increase & Attorney Fees

ANNUAL INCREASE

By Industry Notice No. 162, dated September 12, 2017, The U.S. Department of Labor, which administers the Longshore Act, has announced the new National Average Weekly Wage (NAWW) effective October 1, 2017, and consequently the new maximum and minimum rates for weekly benefits derived from the NAWW under Section 910(f) of the Longshore Act.

The new NAWW effective for the period October 1, 2017, through September 30, 2018, is $735.89.  This represents a 2.46% increase over the October 1, 2016, NAWW.  All beneficiaries receiving permanent total disability or related death benefits as of September 30, 2017, receive a 2.46% increase in their weekly rate.

The weekly rates for temporary total disability and permanent partial disability are subject to the maximum rate that is applicable on the date of injury.  These benefits are not increased annually.

The new NAWW provides the new maximum and minimum weekly rates.   Effective October 1, 2017, the maximum weekly rate under the Longshore Act is 200% of the NAWW, or $1,471.78.  The new minimum weekly rate is 50% of the NAWW, so it is $367.94.

Note on calculating the weekly compensation rate:  The weekly rate for permanent total disability and temporary total disability and for permanent partial disability based on the schedule in Section 908(c) is two-thirds of the worker’s Average Weekly Wage (AWW).  The weekly rate for permanent partial disability based on a loss of wage-earning capacity is two-thirds of the difference between the AWW and the post-injury wage-earning capacity.  The weekly rate for a widow is fifty percent of the AWW.  The AWW is established as of the date of the injury.

The minimum weekly rate does not apply in Defense Base Act cases.

ATTORNEY FEES

Section 28(a) of the Longshore Act states, “If the employer or carrier declines to pay any compensation on or before the thirtieth day after receiving written notice of a claim for compensation having been filed from the deputy commissioner on the ground that there is no liability for compensation within the provisions of this chapter and the person seeking benefits shall thereafter have utilized the services of an attorney at law in the successful prosecution of his claim … “ then the employer may be liable for the claimant’s attorney’s fee.

In the case of Steven Lincoln v. Director, Office of Workers’ Compensation Programs, U.S. Department of Labor; Ceres Marine Terminals, Inc., decided March12, 2014, the federal Fourth Circuit Court of Appeals affirmed a Benefits Review Board’s (Board) decision denying an employer paid attorney fee.

In the Lincoln case, based on a 4/11/11 audiogram the claimant filed a claim for hearing loss on 5/24/11, which the employer controverted on 5/26/11.  The employer received written notice of the claim from the Department of Labor (DOL) on 6/14/11, and on 7/7/11 the employer voluntarily paid $1,256.84 in compensation, which was the equivalent of one week’s compensation at the maximum weekly rate and was paid within the 30 day time limit of Section 28(a). The employer acknowledged that there was workplace noise-induced hearing loss, but that additional information was needed before it could determine the correct compensation payment.

The Board held that the term “any compensation” in Section 28(a) is unambiguous and plainly encompasses an employer’s partial payment.  The Fourth Circuit affirmed that the payment of one week’s compensation was directly tied to the alleged injury and was not merely an attempt to avoid fee shifting.  Thus, under the terms of Section 28(a), the employer was not liable for the claimant’s attorney’s fee.

The Lincoln case did not mention medical benefits (whether they constitute “compensation”) in relation to the phrase “any compensation”.   Now we have a case that deals with medical benefits and Section 28(a).

The case is Arthur B. Taylor v. SSA Cooper, L.L.C. and Homeport Insurance Company and Director, Office of Workers’ Compensation, U.S. Department of Labor, Benefits Review Board No. 16-0174, issued June 30, 2017.

In the Taylor case, the employer paid medical benefits within the Section 28(a) thirty-day time limit but did not pay weekly disability compensation.

The employer argued that it satisfied the Section 28(a) requirement of “any compensation” by the payment of medical benefits and should not be liable for the claimant’s attorney’s fee.

The issue, thus, was whether the employer’s payment of medical benefits within the thirty day period constitutes payment of “any compensation” such that the employer cannot be held liable for an attorney’s fee, even though the claimant was successful in obtaining disability benefits after using the services of an attorney.

The Administrative Law Judge (ALJ) denied an employer paid attorney’s fee, finding that the phrase “any compensation” includes medical benefits, and in this case, the employer paid medical benefits and thus did not decline to “pay any compensation” within thirty days.

The Board reversed the ALJ’s decision.

The Board held that the term “compensation” in Section 28(a) should be read as “disability and/or medical benefits”.  The Board stated, “Its (compensation) precise meaning in the phrase “declines to pay any compensation” depends on what benefits are claimed and what benefits the employer paid or declined to pay in each case.  Whether a claimant files a claim for both disability and medical benefits or for only one or the other type of benefit, fee liability under Section 28(a) depends on whether there is success in obtaining the claimed but denied benefit”.

Essentially, if any type of claimed benefit is denied with no payment within 30 days of receipt of the claim from the DOL and legal services are necessary to obtain the denied benefit, the claimant will be entitled to an employer-paid attorney fee.

Doug Matthews, a New Orleans-based attorney at King Krebs & Jurgens who specializes in longshore cases, raised several questions related to this case.

For instance, if there are issues with regard to medical bills in the first 30 days after receipt of the claim from the DOL, is a direct analogy with the Lincoln case suggested?  Should the employer tender some amount “directly tied to the alleged injury” against potential medical liability to protect itself under Section 28(a)?

It’s not unusual for a decision to resolve the issues between the immediate parties, but in a broad sense, it seems to raise more questions than it answers. We’ll wait for future cases for clarification.

 

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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: Annual Increase

The U.S. Department of Labor has announced the new National Average Weekly Wage (NAWW) effective October 1, 2012, and consequently the new maximum and minimum rates for weekly benefits derived from the NAWW under Section 910(f) of the Longshore and Harbor Workers’ Compensation Act.

The new NAWW effective October 1, 2012, is $662.59.  This represents a 2.31% increase over October 1, 2011.  All beneficiaries receiving permanent total disability or related death benefits as of September 30, 2012, will receive a 2.31% increase in their weekly rate.

The new NAWW provides the new maximum and minimum weekly rates.  Effective October 1, 2012, the maximum weekly rate under the Longshore Act is 200% of the NAWW, so the new maximum rate is $1,325.18.  The minimum weekly rate is 50% of the NAWW, so the new minimum rate is $331.30.

A Note on weekly benefits:  The weekly rate for permanent total disability and temporary total disability and for permanent partial disability based on the schedule in Section 908(c) is two thirds of the Average Weekly Wage (AWW).  The weekly rate for permanent partial disability based on a loss of wage earning capacity is two thirds of the difference between the AWW and the post injury wage earning capacity.  The weekly rate for a widow is fifty percent of the AWW.  The AWW is established as of the date of the injury.

Another Note on the new NAWW and maximum rate and the timing of their application under Section 906(c):

Section 906(c):  Applicability of determinations.  Determinations under subsection (b)(3) (new NAWW) with respect to a period shall apply to employees or survivors currently receiving compensation for permanent total disability or death benefits during such period as well as those newly awarded compensation during such period.

Earlier this year the U.S. Supreme Court decided the case of Roberts v. Sea-Land Services, Inc., et al., interpreting the language in Section 6(c).  The issue in the case was, “What maximum weekly rate applies to compensation for disability under the Longshore and Harbor Workers’ Compensation Act?”  Is it the maximum in effect as of the date of first entitlement to permanent total disability, or is it the higher, later maximum rate as of the date of the Administrative Law Judge’s Compensation Order?

The weekly rate is capped at 200% of the applicable NAWW.  Since there is a new NAWW each October 1, weekly benefits are increased each October 1 for employees or survivors “currently receiving” compensation for permanent total disability (PTD) or related death benefits during such period as of September 30, as well as those “newly awarded compensation” during such period based on the change in the NAWW.

The Roberts decision, and this issue, has been discussed here previously on December 21, 2011, January 11, 2012, and March 22, 2012.  The then current NAWW and maximum rate is effective when an employee is “newly awarded compensation”, which is when he first becomes disabled and thereby becomes statutorily entitled to benefits, no matter whether, or when, a compensation order issues on his behalf.

So, once again, the new NAWW and weekly maximum rate effective October 1, 2012, applies to those receiving benefits for permanent total disability or related death on September 30, 2012, as well as those who first become entitled to permanent total disability or related death benefits between October 1, 2012, and September 30, 2013.

One more thing:  The weekly rates for temporary total disability and permanent partial disability are subject to the maximum rate on the date of injury.  These benefits are not increased annually.  

 

ISSUE: Annual Rate Increase

The U.S. Department of Labor has announced the annual rate increase effective October 1, 2011, under section 910(f), based on the new National Average Weekly Wage (NAWW).  

The new NAWW effective October 1, 2011, is $647.60.  This represents a 3.05% cost of living increase over October 1, 2010.  All beneficiaries receiving permanent total disability or related death benefits as of September 30, 2011, receive a 3.05% increase in their weekly rate.

The new NAWW also establishes the new maximum and minimum rates under section 906(b); effective October 1, 2011, the maximum weekly rate under the Longshore Act is 200% of the NAWW, so the new maximum rate is $1,295.20 per week.  The minimum rate is 50% of the NAWW, so the new minimum rate is $323.80 per week.

Issue: Annual Increase

Please pardon the interruption.  Just a brief note that the U.S. Department of Labor has announced the annual rate increase effective October 1, 2010, applicable to permanent total disability and related death benefits.

Section 910(f) of the Longshore Act states, “Effective October 1 of each year, the compensation or death benefits payable for permanent total disability or death arising out of injuries subject to this Act shall be increased by the lesser of –

(1)    a percentage equal to the percentage (if any) by which the applicable national average weekly wage for the period beginning on such October 1, as determined under section 6(b) exceeds the applicable national average weekly wage, as so determined, for the  period beginning with the preceding October 1, or

(2)    5 per centum

Section 906(b) states, “Maximum rate of compensation.

(1)    compensation for disability or death shall not exceed an amount equal to 200 per centum of the applicable national average weekly wage, as determined by the Secretary….

(2)    compensation for total disability shall not be less than 50 per centum of the national average weekly wage….”

The National Average Weekly Wage (NAWW) effective October 1, 2009 was $612.33.  The Department of Labor has announced a 2.63% increase in the NAWW effective October 1, 2010, so the new NAWW is $628.42.

Since the new National Average Weekly Wage effective October 1, 2010, is $628.42, in accordance with section 906(b), the new weekly Longshore Act maximum rate is 200 per cent of the NAWW or $1,256.84.  The minimum is 50% or $314.21.

Beneficiaries receiving permanent total disability or related death benefits as of September 30, 2010, receive a 2.63 per cent increase in their weekly rate.  The current rate is multiplied by 2.63% and rounded to the nearest dollar for the new rate.