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Reasonable Attorneys' Fees in Workers' Compensation Claims

When workers' compensation claims turn into contentious litigation, sometimes the attorneys' fees can end up outweighing the total claim amount. Though this might cause you to wonder, what's the point of the fight, the fact is many workers' compensation statutes allow for successful claimants to recover reasonable attorneys fees incurred in engaging in litigation. Unless the court thoroughly explains why it feels the amount is unreasonable, it should not reduce the award amount.

A recent Ninth Circuit case serves as a reminder of the care the court must take in explaining an attorneys' fee reduction.  In Rick Carter v. Caleb Brett LLC, 12-16846 (9th Cir. Feb. 3, 2014), Mr. Carter injured his neck and back while working, causing permanent disability. Although the amount at stake in the claim was only a touch over $3,200, the fight to get that amount led to over $22,500 in attorneys' fees. After awarding Mr. Carter money for his injuries, the court reduced the amount it chose to award in attorneys' fees by nearly half the amount his attorneys charged.

Though the lower court identified a few reasons for the reduction, the Appeals Court felt a more thorough explanation was necessary in order to justify such a significant reduction. The Appeals Court highlighted twelve factors the court should look to, and decided if any number of them should serve as the basis for an attorneys' fees reduction, the reasoning should be detailed and specific. Those factors are:

  • (1) the time and labor required; 
  • (2) the novelty and difficulty of the questions involved; 
  • (3) the skill requisite to perform the legal service properly; 
  • (4) the preclusion of other employment by the attorney due to acceptance of the case; 
  • (5) the customary fee; 
  • (6) whether the fee is fixed or contingent; 
  • (7) time limitations imposed by the client or the circumstances; 
  • (8) the amount involved and the results obtained; 
  • (9) the experience, reputation, and ability of the attorneys; 
  • (10) the "undesirability" of the case; 
  • (11) the nature and length of the professional relationship with the client; and 
  • (12) awards in similar cases.

Of course, whether you're an employee bringing a claim, or an employer challenging a claim, the best way to avoid challenges to attorneys' fees awards is to hire trusted employment law attorneys with reasonable rates in the first place.

 

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