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Wednesday, July 2, 2014

NJ Senate Passes Law To Help Injured Workers

The NJ Senate took an historic step on Monday by passing legislation to assist injured workers navigate the workers' system and to level the playing field after decades of the erosion. By passing passing S374 the NJ Senate encourages attorneys to represent workers who suffered accidents and diseases arising out of their employment.

The legislation passed by the NJ Senate will assist injured workers in gaining legal representation and reverses a tide to eliminate attorneys from the process. For decades employers and their insurance carriers have only made voluntary offers and tenders of disability payments after the appearance of an attorney on behalf of an injured worker in a matter. No legal fees were earned and attorneys barely got paid to handle the claim going forward. 

Currently, legal fees are subject to the discretion of the Compensation Judge and are capped at 20% of the award, excluding voluntary (bona fide) tender and offers.

This legislation benefits injured workers and is an attempt to level the playing field. This legislation should be supported.

"The Senate Judiciary Committee reports favorably and with
committee amendments Senate Bill No. 374.
 This bill, as amended, requires that in cases in which a workers’
compensation petitioner has received compensation from an insurance
company prior to any judgment or award, the reasonable allowance for
attorney fees will be based upon the sum of the amount of
compensation received by the petitioner prior to any judgment, but
after the establishment of an attorney-client relationship pursuant to a
written agreement, and the amount of the judgment or award in excess
of the amount of compensation already received by the petitioner.
Currently, in cases in which a petitioner has received compensation
prior to a judgment or award, a reasonable attorney fee is based upon
only that part of the judgment or award that is in excess of the amount
of compensation already received by the petitioner.
 This bill was pre-filed for introduction in the 2014-2015 session
pending technical review. As reported, the bill includes the changes
required by technical review, which has been performed. "

The century old NJ workers' compensation system was built on the premise of providing speedy and remedial benefits to workers who are injured as a  result of an occupational injury or exposure. The system was theoretically a "promise" made by employers to provide an easier, quicker and faster administrative benefit program without the need to proceed with a claim in the litigious, expensive and complicated civil justice system.

The system was established to be a self-executing administrative system. It was to operate in an informal setting without the need for lawyers and litigation.

Unfortunately, over the decades, things became more complicated and complex. Denial and delay became a prevailing theme.

Exposures not envisioned in the original 1911 Act, ie. silicosis (and later asbestosis) were brought into the program to shield insurance carriers and employers from limitless compensatory and punitive damages from toxic exposure claims. This is revealed historically through New Jersey litigation, ie. "The Summer Simpson Papers," see Austin v Johns-Manville, corporate conspiracy.

Additionally, new and expensive treatment modalities/protocols, pharmaceutical regimens and wage equality, as well as other factors, increased costs to the compensation system.

The need increased over the decades for injured workers to have legal knowledgeable legal representation. The NJ Supreme Court recognized that need and established an attorney certification program.

In an effort to limit costs and exposures employers and their insurance carriers have attempted to make changes in the name of "reform" that calls for the reduction and/or elimination of legal representation by attorneys. Obviously if legal fees are eliminated then an injured worker has difficulty in finding a lawyer. Both the State of Florida and the State of California have utilized this tactic.

Senate Bill No. 374 is step forward to help injured workers and their families. While workers' compensation is a consequence of unsafe working conditions, the enactment of this law will hopefully add an economic incentive for employers to maintain safer working conditions. That will be a positive reform to the end of reducing workers' compensation costs overall.


Jon L. Gelman of Wayne NJ is the author of NJ Workers’ Compensation Law (West-Thompson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thompson-Reuters). For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  have been representing injured workers and their families who have suffered occupational accidents and illnesses.