Attorney's Fees and Costs in Louisiana Workers Compensation

How Much Are Attorney's Fees in Louisiana Workers Compensation?

Attorney's fees in Louisiana workers compensation are limited to twenty percent (20%) of the total amount of recovery.

Attorney's fees in Louisiana workers compensation must be approved by the workers compensation Judge and are to be paid from the amount awarded to the injured employee in the manner allowed by the workers compensation Judge.

This twenty percent (20%) limitation on the fees of a Louisiana workers compensation attorney is just that—a maximum amount payable.

This twenty percent (20%) limit on attorney's fees is not a minimum which must necessarily be awarded, and the attorney does not have an absolute right to that amount.

However, it is extremely rare that a workers compensation Judge will not approve a twenty percent (20%) attorney fee because under Louisiana law, a workers compensation attorney has a potential privilege on the compensation payable or awarded.

Instead, the workers compensation Judge will recognize the right of an attorney to a reasonable fee for work done; after all, the twenty percent (20%) attorney's fee in Louisiana workers compensation is much lower than the 30% to 45% contingency fees charged regularly by attorneys in personal injury cases.

Therefore, even though the twenty percent (20%) fees of a Louisiana workers compensation attorney is just a limit, an injured employee should expect that the attorney's will, in fact, be twenty percent (20%).

Exceptions to the Twenty Percent (20%) Attorney's Fees Rule 

One exception to the twenty percent (20%) attorney's fees in Louisiana workers compensation is that an employee's attorney can not take his or her fee out of the seed payment in the employee's structured Medicare Set-Aside Account (MSA).

Another exception to the twenty percent (20%) attorney's fees in Louisiana workers compensation is that the $50,000.00 one time payment which may be made for third-degree burns over 40% or more over the claimant's body and/or paraplegia or quadriplegia or total loss of use of both hands or both arms or both fee, or both eyes, one hand, and a foot or any two thereof, is exempt from the privilege of attorney fees (although an award of attorney fees for collection of that amount may be had).

A third exception to the twenty percent (20%) attorney's fees in Louisiana workers compensation is that an employee's attorney is not limited to twenty percent (20%) attorney's fees if the workers compensation Judge awards the attorney or the injured employee attorney's fees (meaning that the Judge orders that the workers compensation insurance company must pay the attorney's fees of the injured employee). 

In other words, when attorney fees are separately awarded to the employee to be paid by the workers compensation insurance company, the twenty percent (20%) limit on attorney's fees does not apply, and the employee's attorney can accept and keep the fee award even if it is greater than twenty percent (20%) of all recovery in the case, provided that the written contract between the employee's attorney and the employee allows this.

How Are Attorney's Fees Paid in Louisiana Workers Compensation?

As noted above, attorney's fees in Louisiana workers compensation are limited to twenty percent (20%) of the total amount of recovery.

So basically, if there is no recovery, then the employee does not have to pay anything.

So in Louisiana workers compensation, attorney's fees come from an employee's benefits, not out-of-pocket.

Often, the entire fee will be based upon, and come out of, only the final settlement of the workers compensation claim.

If an attorney's services result in the employee receiving a weekly wage-loss check, then typically, the attorney will take a fee on those checks. 

At any rate, an injured employee won't pay anything in attorney's fees until the employee's weekly lost wage benefit checks start arriving.

How Much Are Court Costs and Other Costs in Louisiana Workers Compensation?

In addition to attorney's fees, Louisiana workers compensation claims involve other out-of-pocket costs.

Some of these common expenses include:

    • Court filing fees and costs;
    • Subpoena costs;
    • Fees for copies of medical records;
    • Court reporter costs for depositions;
    • Copying costs;
    • Postage and delivery costs.
    • Attorney travel expenses;
    • Mediation fees; and
    • Expert witness fees.

Generally, these costs and expenses are not included in standard fee agreements of most workers compensation attorneys.

However, most workers compensation attorneys (like most personal injury attorneys) will front these costs (pay them upfront) and then deduct them out of any settlement funds.

How and when these costs and expenses are handled should be laid out very clearly in the fee agreement/contract that the employee must sign with a workers compensation attorney.

So it is very important for the employee to understand, before hiring a workers compensation attorney, how and when these costs and expenses will be paid.

It is also very important for the employee to get an estimate of the typical bill for these costs and expenses, again before hiring a workers compensation attorney.

If the employee is able to settle with the insurance company quickly (or without litigation), the employee's costs and expenses should be minimal.

But on the other hand, if the employee proceeds all the way through to a workers compensation hearing or trial, or even an appeal, the costs and expenses could be quite significant.

Expert Witness Fees

Likely the most significant of any the costs and expenses listed above are the expert witness fees.

In particular, the expert witness fees of physicians (the medical experts) are typically quite significant.

Fortunately, in the injured employee is successful at trial, the workers compensation judge may award legal costs, including expert witness fees, to the employee.

And Louisiana law states that the fees of expert witnesses shall be reasonable and shall not be allowed unless fixed by judgment.

Specifically, the amount of such fees for physicians is a question directed to the discretion of the workers compensation judge and will be changed on appeal only in extreme cases.

Although the fixing of the expert witness fee may take into account time spent in organizing and preparing material for testimony, it is not proper to include pay, as such, for the time spent in studying for testifying in the case. 

Lastly, Louisiana workers compensation law states that the expert's fee for depositions shall be fixed on an hourly basis for the actual taking of the deposition and travel time if it is taken away from the expert's regular place of business.

Can the Court Order the Insurance Company to Pay an Employee's Attorney's Fees in Louisiana Workers Compensation?

Under Louisiana workers compensation law, the workers compensation Judge may impose sanctions on a workers compensation insurance company for a failure to pay an employee's claims within a suitable period of time after an adequate proof of loss, without a reasonable excuse.

These sanctions include awards of penalties, attorney's fees, costs and interest against the workers compensation insurance company, and in favor of the injured employee.

For example, if a workers compensation insurance company discontinues lost wage payments for a  workers compensation claim without probable cause or in an arbitrary or capricious manner, then this workers compensation insurance company is subject to a penalty of up to $8,000 and reasonable attorneys' fees.

The “Reasonably Controverted” and “Arbitrary, Capricious or Without Probable Cause” Standards

Under Louisiana workers compensation law, penalties and attorney's fees are awarded for failure to properly pay benefits on time unless the workers compensation insurance company can “reasonably controvert” the claim or the non-payment results from conditions over which the workers compensation insurance company had no control.  

Additionally, penalties and attorney's fees are awarded when the workers compensation insurance company discontinues benefits when the discontinuance is found to be "arbitrary, capricious or without probable cause." 

According to Louisiana courts, the standards of “reasonably controverted” and “arbitrary, capricious or without probable cause” are very similar, but not exactly the same.

That is, if the workers compensation insurance company can present a reasonable basis for some subsequent objection to the workers compensation benefits, then it will not have to pay penalties and attorney's fees.

In other words: given the facts, medical and otherwise, known to the workers compensation insurance company, did the workers compensation insurance company have a reasonable basis to believe that medical expenses and compensation benefits were not due the employee?

The Amount of Attorney's Fees Awarded

In Louisiana workers compensation, the only limitation on the amount of attorney's fees is that they should be “reasonable.”

An award of attorney's fees is not to be used as a punishment; instead, the attorney's fees should be measured by the complexity of the case and the required skill of the attorney.

The workers compensation Judge will have the discretion to determine the amount of the attorney's fees to be awarded, and will typically take into account the following factors:

    1. The degree of skill and ability exercised by the attorney;
    2. The amount of the claim;
    3. The amount recovered for the injured employee; and
    4. The amount of time devoted to the claim by the attorney.

Nevertheless, each claim for attorney's fees will be considered in light of the specific circumstances of each claim, and again the amount of attorney's fees awarded must be a reasonable amount in light of the above-listed factors.

Generally speaking, awards for attorney's fees typically range from between $10,000 and $20,000, though the awards can certainly be above or below these amounts, depending on the specific circumstances of the claim, including the above-listed factors.

And, if an award of attorney's fees is made, judicial interest runs on that award from the date of judgment, in the same manner and time in which judicial interest begins to run for penalties.

Attorney fees can be sought and pursuit of same can be supported by an Affidavit of Time prepared by the attorney and presented to opposing counsel for his perusal and consideration during settlement negotiations; when the case goes to trial, this same document can be presented for admission into evidence in support of the sought after attorney's fees.

Awards of Attorney's Fees Greater than Twenty Percent

As stated above, in Louisiana workers compensation, the amount of attorney's fees is limited to 20% of the amount recovered for the injured employee.

However, when attorney fees are separately awarded to the employee (and to be paid by the workers compensation insurance company), this 20% limitation on attorney's fees does not apply.

It is neither unethical nor a violation of the Louisiana law for the employee'􏰊s attorney to accept and keep the award for attorney's fees, even if it is greater than 20% of the total recovery in the claim.

However, in order to keep the award for attorney's fees, even if it is greater than 20% of the total recovery in the claim, the written contract between the employee and the employee's attorney must state that the attorney's fee awarded will be in addition to the 20% contingency fee (and not in lieu of the 20% contingency fee), and the total amount of attorney's fees must be both reasonable and approved by the workers􏰊 compensation Judge.

What Legal Services Will An Attorney Perform in Exchange for Attorney's Fees in Louisiana Workers Compensation?

A qualified, experienced Louisiana workers compensation attorney can drastically improve an injured employee's situation and claim.

Specifically, a Louisiana workers compensation attorney can:

    1. Help find the best doctor for an injured employee;
    2. Manage the workers compensation claims process;
    3. Ensure the full lost wage benefits are received;
    4. Ensure that all medical treatment is approved and received;
    5. Manage the vocational rehabilitation process;
    6. Represent the employee in workers compensation disputes;
    7. Represent the employee in third-party claims; and
    8. Maximize the employee's settlement.

Given the 20% limit on workers compensation attorney's fees in Louisiana, almost every injured employee should strongly consider hiring a qualified attorney to represent him or her in the claim.  

In short, the benefits of legal representation in Louisiana workers compensation far outlay the costs.

However, one of the biggest mistakes that employees make is waiting too long to hire a workers compensation attorney.  

By the time many injured workers hire an attorney, the insurance company has likely already diminished, limited, or extinguished many of the employee's legal rights, and thus devalued the employee's claim.

And contrary to what the insurance company wants the employee to believe, the insurance company will not treat the employee better if the employee doesn't hire a lawyer, the insurance company will treat the employee worse (and often much much worse).

The Louisiana Statutes for Attorney's Fees and Costs in Louisiana Workers Compensation

The primary Louisiana statutes regarding attorney's fees and costs in Louisiana Workers Compensation are La. R.S. 23:1141 and La. R.S. 23:1143, which read as follows:

§1141.  Attorney fees; privilege on compensation awards

A.  Claims of attorneys for legal services arising under this Chapter shall not be enforceable unless reviewed and approved by a workers' compensation judge.  If so approved, such claims shall have a privilege upon the compensation payable or awarded, but shall be paid therefrom only in the manner fixed by the workers' compensation judge.  No privilege shall exist or be approved by a workers' compensation judge on injury benefits as provided in R.S. 23:1221(4)(s).

B.  The fees of an attorney who renders service for an employee coming under this Chapter shall not exceed twenty percent of the amount recovered.

Amended by Acts 1958, No. 496, §1; Acts 1980, No. 599, §1; Acts 1983, 1st Ex. Sess., No. 1, §1, eff. July 1, 1983; Acts 1988, No. 938, §1, eff. July 1, 1989; Acts 1989, No. 23, §1, eff. June 15, 1989; Acts 1989, No. 260, §1, eff. Jan. 1, 1990; Acts 1995, No. 609, §1; Acts 1996, 1st Ex. Sess., No. 31, §1, eff. May 1, 1996; Acts 1997, No. 88, §1, eff. June 11, 1997; Acts 2004, No. 647, §1, eff. July 5, 2004.

§1143.  Excessive fees or solicitation of employment; penalty; withholding attorney fees; approval by workers' compensation judge

A.  Whoever exacts or receives a fee or gratuity for any services rendered on behalf of a claimant for compensation, except in the amount determined by the workers' compensation judge, or solicits the business of appearing before the office on behalf of a claimant, or makes it a business to solicit employment for an attorney in connection with any claim for compensation under this Chapter, shall be fined not more than five hundred dollars or imprisoned for not more than twelve months, or both.

B.(1)  An attorney may withhold, as proposed attorney fees, a sum not to exceed twenty percent of all amounts recovered in his trust account which funds shall remain the property of the claimant, pending approval of such fees by the workers' compensation judge.

(2)  An application for approval of fees shall be filed by the attorney within thirty days after the payment of the final weekly benefit, settlement of the claim, or payment of the judgment, whichever occurs later.  Otherwise the funds shall be returned to the claimant.

Acts 1990, No. 202, §1; Acts 1997, No. 88, §1, eff. June 11, 1997; Acts 2001, No. 672, §1; Acts 2004, No. 647, §1, eff. July 5, 2004.

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