Show me the money Part 2

In our last email blast, we discussed the importance of timely paying on a claim in order to avoid the imposition of a penalty for late payment.

One situation in which a workers’ compensation payor could potentially incur a hefty penalty for a late payment for a late payment is the failure to pay a non-appealable judgment, including a settlement, within thirty (30) days.

We often see this in one of three situations:

1. The court renders judgment in favor of the claimant ordering the payment of indemnity and/or medical benefits, but the payor fails to tender the payment within 30 days of the judgment becoming final.

2. The payor (or their attorney) reaches an agreement in writing to settle a pending LW-WC-1008 Disputed Claim for Compensation, but the settlement funds are not tendered within 30 days of agreement, or

3. The payor (or their attorney) reaches an agreement for full and final settlement, but settlement funds are not tendered within 30 days of court-approval of the full and final settlement.

Notably, there is some disagreements amongst the workers’ compensation courts as to when a judgment approving a settlement becomes final and non-appealable; however, best practices dictate payment as soon as possible if there is no intent to appeal.

In this context, La. R.S. 23: 1201 (G) of the Louisiana Workers’ Compensation Act provides for a penalty of the greater of 24% of the amount owed or $100 per day for each day the amount remains unpaid (up to $3,000).

In order to avoid such a penalty, we recommend the following best practices:

1. Monitor your mail and email for any judgments / settlement confirmations and accompanying request for payment;

2. Upon receipt, request any additional information and/or documentation needed to issue payment (e.g., W-9s, payment instructions, breakdown of funds, deadline for payment, etc.);

3. Confirm the manner (preferably with tracking) and address to which payment is to be sent;

4.  Immediately request payment as specified; and

5. Maintain open communication with the claimant and/or your attorney regarding the status of payment until delivery of payment is confirmed.