NJ Gov Murphy Signs Law Increasing Workers' Compensation Counsel Fees

NJ Governor Phil Murphy has signed into law legislation that increases counsel fees in Workers' Compensation claims. The law requires the assessment of counsel fees on all offers and tenders made by an employer or insurance companies. The Act is effective immediately. 

Counsel fees are now to be determined in cases in which a workers’ compensation petitioner has received compensation from an insurance company or self-insured employer prior to any judgment or

NJ Gov. Phil Murphy

award. The reasonable attorney fee is to based upon the amount of the compensation received after the establishment of an attorney-client relationship (as memorialized in a written agreement), plus any amount of the judgment or award which is in excess of the previously received compensation. Under former law, in such cases involving insurance or self-insurance compensation, the attorney fee was based solely on any amount of a judgment or award that is in excess of the amount of previously received compensation.

This legislation ends the era of voluntary tender and offers (VT) for which no counsel fee could be assessed by the NJ Division of Workers' Compensation. The VT tactic has been used in the past to greatly diminish counsel fees of attorneys representing injured workers and stymied legal representation. The new legislation will level the playing field and provide an incentive to attorneys to represent injured workers.

Historically, "An offer and tender may be withdrawn or modified by the respondent prior to its full payment. The offer and tender is not binding upon the respondent and is revocable. If the respondent withdraws or modifies the offer prior to the hearing, it will be responsible for a statutory award of the counsel fee to the extent that the final award is in excess of the payment made." Torres v. Miller, 238 N.J.Super. 158, 569 A.2d 301 (App.Div.1990). Gelman, Jon L, Workers’ Compensation Law, 38 NJPRAC 30.2 (Thomson-Reuters 2018).

S2145 Concerns attorney fees for workers' compensation awards.  Passed both Houses  Identical Bill Number: A2510  Last Session Bill Number: A3426    Scutari, Nicholas P.   as Primary Sponsor Sweeney, Stephen M.   as Primary Sponsor DeAngelo, Wayne P.   as Primary Sponsor Downey, Joann   as Primary Sponsor Mukherji, Raj   as Primary Sponsor Chaparro, Annette   as Co-Sponsor 3/5/2018 Introduced in the Senate, Referred to Senate Judiciary Committee 3/26/2018 Reported from Senate Committee, 2nd Reading 4/12/2018 Passed by the Senate (24-12) 5/7/2018 Received in the Assembly, Referred to Assembly Labor Committee 6/18/2018 Transferred to Assembly Budget Committee 6/18/2018 Reported out of Assembly Committee, 2nd Reading 6/21/2018 Substituted for A2510 6/21/2018 Passed Assembly (Passed Both Houses) (50-25-1) Statement - SJU 3/26/18 - 1 pages PDF Format    HTML Format  Statement - ABU 6/18/18 - 1 pages PDF Format    HTML Format  Introduced - - 4 pages PDF Format    HTML Format  Committee Voting: SJU  3/26/2018  -  r/favorably  -  Yes {7}  No {4}  Not Voting {0}  Abstains {0}  -  Roll Call ABU  6/18/2018  -  r/favorably  -  Yes {9}  No {4}  Not Voting {0}  Abstains {0}  -  Roll Call Session Voting: Sen.    4/12/2018  -  3RDG FINAL PASSAGE   -  Yes {24}  No {12}  Not Voting {4}    -  Roll Call Asm.  6/21/2018  -  SUB FOR A2510   -  Yes {0}  No {0}  Not Voting {79}  Abstains {0}  -  Voice Vote Passed Asm.  6/21/2018  -  3RDG FINAL PASSAGE   -  Yes {50}  No {25}  Not Voting {3}  Abstains {1}  -  Roll Call … Jon L. Gelman of Wayne NJ is the author of NJ Workers’ Compensation Law (West-Thomson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thomson-Reuters). Related articles: The Inherent Judicial Power of Judges of Compensation NJ Director Announces Policy on Counsel Fees