Florida Murray Case Prompts Legislative Action On Workers' Compensation Reforms

Tallahassee, FL (CompNewsNetwork) - In response to last year's Supreme Court Decision in Murray v. Mariner, the Florida Legislature has introduced a new bill to clarify and restore reforms it passed in 2003. On February 16, 2009, Representative Anitere Flores (R-Miami) filed HB 903 in the Florida House of Representatives. 

 

The bill finds that the Supreme Court nullified the 2003 reforms and is intended to "clarify beyond dispute that the reforms on awards of attorney's fees are an essential element of a functioning and self-executing workers' compensation system". Fundamentally, it does not change the circumstances under which the employer/carrier is responsible for paying fees. However, it does remove the requirement that fees be "reasonable" and mandates that the fees may not exceed the statutory percentages. The Court's decision eliminates the statutory caps on attorney fees that were imposed as a result of the 2003 reforms under SB 50A and will enable claimant attorneys handling workers' compensation claims to collect increased fees for their services. 

The 2003 Amendments to FS 440.34 established guideline attorney fees wherein the sole statutory basis for determining the amount of an attorney's fee except in the case of "medical benefits only" claims, is the value of the benefits secured on behalf of the claimant. The JCC was prohibited from approving any agreement which provides for an attorney's fee in excess of the guideline fee. Prior to the 10/1/03 amendments, a JCC had the discretion to deviate from the statutory guideline fee when the fee would be "manifestly unfair."

 

The claimant bar challenged the new law stating it basically refused "access to courts" to the injured worker and was unconstitutional. The Florida Supreme Court heard the case of Murray v. Mariner in April of 2008 and in October of 2008, the Court released its decision.  In the decision, the constitutional issues were not addressed as the case was decided on the basis of statutory construction. The decision states: "based upon the plain language of the statute, that when a claimant is entitled to recover attorney fees from a carrier or employer as provided by section 440.34(3)(a), (b), (c), or (d), the claimant is entitled to recover "a reasonable attorney's fee."  It also states: "...we have determined that reasonable attorney fees for claimants, when not otherwise defined in the workers' compensation statute, are to be determined using the factors of rule 4-1.5(b) of the Rules Regulating the Florida Bar."  

 

This decision has had an impact on premium rates in the state, and this year started to reverse the largest consecutive cumulative decrease on record in Florida workers' compensation rates – dating back to 1965.

On Jan. 26, Florida Insurance Commissioner Kevin McCarty issued an order denying the National Council on Compensation Insurance’s (NCCI) Nov. 14 rate filing in which it was seeking an 8.9 percent rate increase as a result of the impact on rates it projects following the Oct. 23 Florida Supreme Court opinion in the case. In early February McCarty issued a final order approving a 6.4 percent increase in workers' compensation insurance rates, based on an amended filing by NCCI. The approved increase applies to new and renewal business and will become effective April 1. In October, Commissioner McCarty approved an 18.6 percent reduction in rates, effective Jan. 1. It was the sixth consecutive drop in worker's compensation rates since the Florida Legislature passed the reforms in 2003; and with the change, the cumulative overall statewide average rate decrease since 2003 is more than 60 percent. The NCCI originally had requested a 14.1 percent decrease in its filing of Aug. 27. The further reduction in rates had the potential to save Florida employers more than $610 million.

 

The 18.6 percent decrease in October stands as the largest one-year decrease on record, following the two previous largest decreases – 18.4 percent for 2008 and 15.7 percent for 2007.