Jeffrey P. Gale, P.A. // The Long Evolution of Attorney’s Fees in Florida Workers’ Compensation

greed2For as long as our law firm has been handling Florida workers’ compensation cases, the amount injured workers’ attorneys may receive as a fee has always been a hot topic. The two main factors driving the conversation are the injured workers’ share of a recovery, typically through a settlement, and limiting litigation. While the Florida Legislature pays lip service to the first factor, the second factor is the actual driving force.

Since 1998, when Republicans, with the election of Jeb Bush as governor, took full total control of the lawmaking process in Florida, the workers’ compensation laws have been tailored to make it difficult for lawyers representing injured workers (a/k/a “claimants”) to earn a sustainable income. The stated policy of the laws has been couched as promoting a greater share of recovered proceeds allocated to claimants instead of attorneys’ fees, but the silent truth is to make it difficult for claimants to hire lawyers willing and able to fight toe-to-toe against employers and their workers’ compensation insurance carriers. Bottom line: There is nothing Big Business hates more than pipsqueaks, i.e., injured workers, being able to challenge them on a level playing field. They want the field tilted in their favor.

The most famous example of this blatant abuse came to a head in Castellanos v. Next Door Company, 192 So.3d 431 (Fla. 2016). Marvin Castellanos was injured while working with Next Door Company. With the help of an attorney, Castellanos prevailed in his workers’ compensation claim, after the attorney successfully refuted numerous defenses raised by the employer and its insurance carrier. However, because the statute then in effect limited his ability to recover attorney’s fees to a sliding scale based on the amount of workers’ compensation benefits obtained, the fee awarded to Castellanos’ successful attorney amounted to only $1.53 per hour for 107.2 hours of work.

The Florida Supreme Court found the statute, which essentially became effective in 2003, unconstitutional. It understood that the statute was designed to make it difficult for injured workers to engage competent legal counsel. Citing Davis v. Keeto, Inc., 463 So. 2d 368 (Fla. 1st DCA 1985) (quoting Neylon v. Ford Motor Co., 99 A.2d 664, 665 (N.J. Super. Ct. App. Div. 1953)) the court noted that a claimant proceeding “without the aid of competent counsel” would be as “helpless as a turtle on its back.” At 371.

Workers’ compensation insurance carriers have not stopped whining about the Castellanos decision. Instead of being stuck with a $164.00 fee for more than 100 hours of work — footnote: the losing attorney in Castellanos, who represented the employer/carrier (E/C), was paid more than $16,000.00 — Castellano’s attorney was able to return to the trial court where he was awarded a reasonable fee upwards of $30,000.00.

The award was fair and good public policy. The right of a claimant to obtain a reasonable attorney’s fee when successful in securing benefits has been considered a critical feature of the workers’ compensation law since 1941. See Murray v. Mariner Health, 994 So. 2d 1051, 1057-58 (Fla. 2008). The stated goal of the workers’ compensation system remains to this date the “quick and efficient delivery of disability and medical benefits to an injured worker” so as “to facilitate the worker’s return to gainful reemployment at a reasonable cost to the employer.” § 440.015, Fla. Stat. Allowing a claimant to “engage competent legal assistance” not only evens the playing field but it actually “discourages the carrier from unnecessarily resisting claims” and encourages attorneys to undertake representation in non-frivolous claims, “realizing that a reasonable fee will be paid for [their] labor.” Ohio Cas. Grp. v. Parrish, 350 So. 2d 466, 470 (Fla. 1977).

While the Florida Legislature has made numerous runs at overriding Castellanos, achieving the goal has proven more difficult than expected. The Castellanos decision, which was sensible and well-reasoned, continues to carry weight. More importantly, despite constant cries from Big Business that Castellanos will cause the sky to fall, workers’ compensation premium rates have pretty much fallen every year since. Be sure, though, if rates start creeping up, the wolves will be at the door howling that claimant’s attorneys’ fees are to blame. It doesn’t matter that the large fee awards result from poor claims handling. It’s easier to blame the lawyers.

2016 was a big year in workers’ compensation attorneys’ fee court decisions. While Castellanos involved so-called ‘carrier-paid’ attorney’s fees, Miles v. City of Edgewater Police Dept/Preferred Governmental Claims Solutions, 190 So. 3d 171 (Fla. 1st DCA 2016) addressed contract rights between injured workers and their attorneys.

Until the Miles case, it was a crime in Florida for an attorney to accept a fee from a claimant in a workers’ compensation case that exceeded the fee formula contained in section 440.34(1), Florida StatutesSection 440.105(3)(c), Florida Statutes. The crime was punishable by up to one year in prison (775.082) and a fine. Moreover, any lawyer violating 440.105(3)(c) could expect to be suspended or disbarred from the practice of law.

In Miles, the JCC rejected an attorney/client contract in which the client, an injured worker, and her union, agreed to pay a workers’ compensation lawyer a fee in excess of the amount allowed under 440.34. Because it would have been a financial hardship for the law firm hired by claimant to handle the case under the formula set forth in 440.34, it withdrew from the case. The injured worker proceeded Pro Se, where she lost before the JCC.

Claimant argued on appeal that Florida statutes 440.105 and 440.34 violated the First Amendment of the Constitution of the United States and the fundamental right to contract. The First District Court of Appeal agreed. At its heart, Miles is about freedom of speech and the right of individuals to contract freely for legal services. The Court found that 440.105 and 440.34 violated those rights:

In conclusion, the restrictions in sections 440.105 and 440.34, when applied to a claimant’s ability to retain counsel under a contract that calls for the payment of a reasonable fee by a claimant (or someone on his or her behalf), are unconstitutional violations of a claimant’s rights to free speech, free association, and petition — and are not permissible time, place, or manner restrictions on those rights. Likewise, those provisions also represent unconstitutional violations of a claimant’s right to form contracts — and are not permissible police power restrictions on those rights.

Miles at 184.

Before Miles changed the workers’ compensation Claimant-paid fee landscape, the statutory fee was considered the presumptively correct fee.  Alderman v. Florida Plastering, 805 So.2d 1097 (Fla. 1st DCA 2002). In Alderman, the JCC rejected a statutory fee because it resulted in an hourly rate of $847.00. The DCA reversed, reasoning as follows: “[I]t is possible that the award in a given case might be higher than the amount that would be obtained by applying an hourly rate. That is the essential feature of a contingent fee arrangement, and it is inherent in the design of the statute.” Id. at 1100.

To protect contingency fees, the Court established the following rule:

Although the judge of compensation claims may increase or reduce the presumptive fee by applying the statutory factors, an increase or reduction is appropriate only in exceptional circumstances [bold added]. Citations omitted. As we said in Marsh v. Benedetto, 566 So.2d 324, 326 (Fla. 1st DCA 1990), a departure is proper only if the presumptive amount produced by the statutory formula is “manifestly unfair,” Id. at 1100.

The “Alderman Rule” was followed in Smith v. Gulf Coast Hospital, 31 So.3d 297 (Florida 1st DCA 2010). In Smith, the statutory fee resulted in an hourly rate of $643.00 per hour. Concluding that this hourly rate is “higher than is typically awarded in the district,” the JCC reduced the hourly rate to $200.00. Citing extensively from Alderman, the First DCA reversed and directed the JCC to award claimant’s attorney “a fee in the amount established by applying the fee schedule.”

The “Alderman Rule” was also followed recently in Michael D. Rudolph v. Darien Smith, The Home Depot U.S.A., Inc. and Liberty Mutual, January 24, 2024 (1st DCA). In Rudolph, the JCC rejected a requested fee, concluding that “there is little there to justify a fee of about $4,000 an hour.” Citing Alderman, the First District reversed the lower court’s rejection, explaining that the JCC erred in departing downward by relying solely on the “customary hourly rate charged in the locality for similar work.”

By declaring the statutory fee unconstitutional, Miles established, of course, that the statutory fee is no longer presumptively correct. By allowing attorney-client contracts for fees in excess of the statutory fee, Miles established that the contract fee rate is the presumptively correct fee in workers’ compensation cases. (The Florida Bar has guidelines on determining the reasonableness of fees, so there are constraints besides just the attorney-client contract.) This conclusion is not changed by workers’ compensation judges being charged with approving attorney’s fees.

CONCLUSION: Workers’ compensation laws have always been a target of the Florida Legislature, sometimes for fair and reasonable reasons but mostly to maximize corporate profits at the expense of injured workers. Even though Castellanos and Miles have leveled the playing field, which has angered Corporate American, the legislative agenda during the past 4-5 years has been relatively tranquil compared to years past. This is attributable to stable and sometimes reduced premium rates, and the Legislature’s obsession, fueled by Florida Governor Ron DeSadist, with ugly and divisive culture wars.  Nevertheless, targeting injured workers is never far from the minds of those same legislators.


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Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.

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DISCLAIMER: This information provided by Jeffrey P. Gale, P.A. is for informational purposes only and is intended to be used as a non-legal guide prior to consultation with an attorney familiar with your specific legal situation. It should not be considered legal advice or counseling. No such legal advice or counseling is either expressly or impliedly intended. This  information is not a substitute for the advice or counsel of an attorney. If you require legal advice, you should seek the services of an attorney.

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