Attorneys who represent injured workers sometimes file liens with the Department of Labor. This has prompted questions about what effect such a filing has on the employer/carrier.
Attorneys may request for
acknowledgement of a lien to the commissioner at any time after the
representation commences, if the following steps are taken: (1) it must be in writing; (2) copied to the
claimant; and (3) it must be accompanied by a copy of the written fee agreement
executed by the claimant. Vermont
Workers’ Compensation Rules, Rule 10.4010.
The Commissioner will acknowledge the lien and mail notice of the claim
against future benefits to the employer/carrier and to the claimant. Vermont
Workers’ Compensation Rules, Rule 10.4011.
Once
an employer/carrier has been provided notice by the commissioner of an
acknowledged attorney’s lien, the carrier must reserve $15,000.00 or 20% of the
amount of any permanent disability compensation due, and/or any lump sum payment
of retroactive temporary total disability benefits, whichever is less. Vermont
Workers’ Compensation Rules, Rule 10.4012. The carrier must also notify the claimant’s
attorney prior to issuing payment to the claimant. Vermont Workers’ Compensation Rules, Rule 10.4012. Failure to reserve the amounts from permanent
disability compensation due, and/or any lump sum payment of retroactive
temporary total disability benefits “shall make the employer/carrier liable, in
the commissioner’s discretion, for payment to the attorney of the amount of an
acknowledged lien.” Vermont Workers’ Compensation Rules, Rule 10.4012.
An attorney
representing an injured worker may request enforcement of a lien but it must
made prior to the date the benefits subject to the lien are due and payable,
and it must be done in a timely fashion so as not to impede disbursement of
benefits payments to the injured worker.
Vermont Workers’ Compensation
Rules, Rule 10.4020, Rule 10.4021.
The request for enforcement should be in writing and include: a copy of the fee agreement executed by the
claimant; and an itemized statement detailing both the work performed and the
hours billed. Vermont Workers’
Compensation Rules, Rule 10.4020. If approved, “the commissioner shall
direct the employer/carrier to deduct the amount approved and advance it to the
attorney against the end of any permanent disability compensation due, and/or
against any lump sum payment of retroactive temporary disability benefits.” Vermont
Workers’ Compensation Rules, Rule 10.4030.
