by Michael P . McCready , Esq .
Why Do So Few Lawyers Handle Federal Workers ’ Compensation Cases ?
A new client calls your office . He explains how he was injured on the job . You figure , “ great , a new worker ’ s compensation case !” After listening further , the client tells you he works for the US Postal Service . A federal employee . You immediately stop the conversation and tell the client you don ’ t handle federal workers ’ compensation cases , and what ’ s more , you don ’ t know anyone who does . The client hangs up and is left on his own .
But why is it that so few lawyers handle federal workers ’ compensation cases ? There are 2.1 million federal civilian employees . That is a huge potential client base , larger than the working age population of twenty states ! There are no court appearances in federal workers ’ compensation cases . All proceedings are done telephonically and almost all documents are uploaded electronically . Because it is based on federal law , you can represent clients all over the country , and in fact , all over the world . There are no state restrictions to practicing law with federal workers ’ compensation cases . Finally , many federal agencies are at a high risk of sustaining work related injuries . Employees of such federal agencies as the United States Postal Service ( USPS ), the Veterans Health Administration ( VA ), the Transportation Security Administration ( TSA ) and the Department of Homeland Security ( DHS ) are all covered under federal workers ’ compensation . Given these factors , there should be a lot of lawyers who handle federal workers ’ compensation cases . But there aren ’ t . Why ?
First , there are no contingency fees in federal workers ’ compensation . In fact , federal law makes it a misdemeanor to charge an injured federal worker a contingency fee . Therefore , all work for federal employees must be billed by the hour with detailed descriptions of the work performed and the time spent . Traditional workers ’ compensation and personal injury lawyers are not accustomed to keeping track of time and billing clients . Additionally , contingency lawyers will charge a percentage of the recovery , which is forbidden in federal cases .
Second , although being able to represent clients nationwide is a positive , when it comes to collecting an unpaid fee for work performed , it is a serious limitation . You can ’ t be suing people all over the country who do not pay your fee . For this reason , most federal workers ’ compensation law- yers charge an upfront retainer . Imagine being injured on the job , perhaps not being paid , and having to send a retainer to a lawyer to represent you in a workers ’ compensation case . The contingency tort system is designed to allow everyone access to the courthouse , regardless of economic means . In federal workers ’ compensation cases , only those who pay their lawyer have representation .
Third , assume a client has paid a retainer and you have kept detailed billing records . You are not allowed to transfer the retainer to your operating account until the client has approved the bill . Yes , that ’ s right , you don ’ t get paid if the client disapproves of the bill , even if you do the work . In a contingency case , you take the risk that you may not win , and if a contingency lawyer fails to make a recovery , there is no fee . In federal workers ’ compensation , you can do the work , and win or lose , you may not get paid if a client does not approve of your fee .
Fourth , any compensation received by an injured federal employee is sent directly to the worker , not his or her attorney . In traditional contingency fee practice , you immediately send a notice of attorney lien or letter of representation to protect your right to get paid . Usually , the settlement check is made payable to the lawyer and the client . Not in federal workers ’ compensation cases . The check is made payable to the client and mailed directly to the client . As you can imagine , this severely hampers a lawyer ’ s ability to get paid , and reinforces the need for a retainer . Because the check is mailed to the client , case loan companies will not provide a case advance to pay a retainer .
It should be obvious from the above discussion of federal workers ’ compensation why there are so few lawyers handling these cases . The federal government justifies these procedures by proclaiming they want the injured worker to receive as much of the recovery as possible , not an attorney . The prohibition against contingency fees is also meant to protect federal employees from being “ overcharged ” for legal services . The assurance that attorneys ’ fees and the claimant ’ s recovery are kept separate is part of that protection . But , what they have done is essentially cut lawyers out of the federal system and deprived federal workers the ability to have legal representation for their injuries .
Setting aside the ability of the lawyer to get paid , the federal workers ’ compensation system is quite similar to state workers ’ compensation systems . Like state Workers ’ Compensation Commissions , in the federal system , “[ t ] he Office of Workers ’ Compensation Programs administers disability compensation programs which provide wage replacement benefits , medical treatment , vocational rehabilitation , and other benefits to certain employees who experience work-related injury or occupational disease .”
Claims must be filed timely and injuries must arise within the performance of duty . There must be a factual basis to the claim as well as a medical basis . Finally , there must be a causal connection between the work and the injury . The injured federal worker has the burden of proof on each of these elements . Federal law covers both traumatic injuries as well as occupational illness which occurs over time , such as toxic exposure and repetitive injuries .
Injured federal employees are also entitled to a Schedule Award for certain permanent medical impairments . OWCP uses the AMA Guides to the Evaluation of Permanent Impairment , 6th Edition exclusively . When an injured federal worker reaches maximum medical improvement , he or she can obtain an impairment rating which will serve as the basis of their Schedule Award . This is the same as many state workers ’ compensation systems , while other state systems allow for a variety of factors to determine the level of permanent impairment .
Unfortunately , there is no entitlement to a Schedule Award under federal law for mental conditions nor for injuries to the head , brain or back . Many state workers ’ compensation systems cover these injuries as “ person as a whole ” or “ non-scheduled injuries ,” but under some states ’ systems as well as the federal system , injuries to these body parts do not entitle an injured worker to a scheduled award . However , if an injury to the head , brain or back causes permanent impairment to an extremity ( arm or leg , for example ), the injured worker may be entitled to a Schedule Award for that region or body part . A Schedule Award is calculated using a formula which includes the AMA impairment rating and the rate of pay of the injured federal employee . Scheduled Awards are paid over a period of weeks , except in exceptional circumstances where it can be paid in a lump sum .
One significant difference between state
34 THE VERMONT BAR JOURNAL • SUMMER 2017 www . vtbar . org