Could an Increase in Assessed Attorney Fees be Coming?


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By: Megan Vaniman

House Bill 2764 was introduced to the House Floor on April 20, 2015. HB 2764, spearheaded by the Oregon Trial Lawyers Association, is wide-reaching and proposes to increase or create new bases for attorney fee awards. HB 2764 has the potential to significantly increase employers’ workers’ compensation costs and premium rates, according to Oregon’s rate setter, NCCI.

HB 2764 proposes a policy change that would require ALJs and the Board to award benefits if a reasonable interpretation of the law would allow benefits. This threatens the impartiality of the administrative process and, over time, the system will award benefits in more and more situations.

Specifically, HB 2764 proposes to remove the $3,000 limit on assessed attorney fees for unreasonable delay in payment of compensation or unreasonable delay in accepting or denying a claim. This comes at a time when we are routinely seeing Administrative Law Judges award higher and higher assessed attorney fees under ORS 656.385. Further, HB 2764 proposes to remove the requirement that the ALJ consider the benefit to the claimant when determining the assessed attorney fee.

In addition to the above changes, HB 2764 creates new or increased attorney fees in the following situations:

  1. An assessed attorney fee for unreasonable delay in the payment of a penalty, attorney fees, or costs;
  2. An attorney fee for being instrumental in reclassification of a claim from non-disabling to disabling before the director;
  3. An assessed, rather than out of compensation, fee for temporary total disability/temporary partial disability increase;
  4. An hourly fee for “all efforts” by claimant’s attorneys who participate in an interview or recorded statement/deposition of the claimant;
  5. Interest accrual on attorney fees/costs that are stayed pending litigation;
  6. Proportionate attorney fee when a claimant prevails in part on a reconsideration dispute initiated by insurer/employer, even if overall compensation is reduced;
  7. “Contingent nature” and attorney fees paid by employer/insurer added to the factors considered in setting rate of scheduled attorney fees;
  8. An attorney fee for unreasonable delay or resistance to payment of a penalty, attorney fee, or costs, including requests by the employer for review at the Court of Appeals, Supreme Court initiated by the employer where the employer does not fully prevail; and
  9. Attorney fees for all work performed at the level of the proceeding and for any other work performed on the claim prior to commencement of the proceeding for cases involving a dispute over compensation benefits.

As described above the act is wide-reaching and proposes to make the changes retroactive, creating potential underfunded or unfunded liabilities. The HB 2764 is currently in front of the House. If it passes the House, it will move on to the Senate committees before being introduced to the Senate floor for vote. It is critical that the legislature hears from employers and insurers about the impact of HB 2764 on Oregon businesses. If you have concerns about this HB 2764, please contact your representative right away and voice your concerns.

To view HB 2764, click here. If you wish to comment to your legislature on HB 2764, you can find him or her here. Associated Oregon Industries has drafted a sample letter to send to your legislature in opposition to the bill. Click here to access the letter.

If you have any questions regarding HB 2764 or its passage, please contact me at mvaniman@sbhlegal.com or Rebecca Watkins at rwatkins@sbhlegal.com