Sometimes, workers are hesitant to hire a lawyer because of what it might cost them. However, Virginia workers’ compensation laws are designed to make hiring a lawyer possible, by keeping attorneys’ fees relatively low and making them contingent on a recovery.
In Virginia, all workers’ compensation lawyers are paid on a contingency fee basis. This means that the lawyer is not paid unless you settle your case or receive an order from a workers’ comp judge granting benefits. Instead of charging you an hourly rate for his or her services, the lawyer gets a portion of your settlement or your award. Additionally, most workers’ compensation lawyers will meet with you for an initial consultation for free.
Attorneys’ fees in workers’ comp cases are lower than in personal injury lawsuits, where the lawyer typically charges 33% to 40%. Unlike many other states, Virginia does not have a set attorneys’ fees schedule. Instead, the Virginia Workers’ Compensation Commission reviews every case individually and sets an appropriate fee. In doing so, the Commission considers several factors, including the complexity of your case, how much time and effort the lawyer put in, and the outcome the lawyer achieved for you.
The maximum contingency fee that the Commission can award is 20%. The Commission is not required to follow a signed fee agreement between a lawyer and client. In fact, the Commission may award less than the maximum fee, even if the lawyer spent a lot of time on a case.
Many workers’ comp lawyers will seek approval of the maximum fee from the Commission. However, sometimes, a lawyer will agree to take on a case for less than a 20% fee. For example, if your dispute is minor and your claim can be quickly resolved, your lawyer might agree to a 15% fee. (For more information, see Can I Negotiate the Attorneys' Fees in My Workers' Compensation Case?)
Legal costs are different than attorneys’ fees; they are the costs of pursuing your case. Legal costs include expert witness fees (for example, for doctors who testify at a deposition or hearing), court reporter fees for transcribing depositions, and filing fees for appeals. In Virginia, lawyers cannot charge workers for the cost of postage, faxes, or other costs that are related to office operations.
While your lawyer can try to limit legal costs, they are usually unavoidable. Preparing a workers’ compensation case for a hearing typically requires developing medical evidence and expert testimony. Without this evidence, it could be impossible to win your claim. In complicated cases, legal costs can run upwards of thousands of dollars.
Most workers’ comp lawyers will not ask you to cover costs up front. Instead, they will pay for legal costs and then deduct them from your settlement or award. Additionally, most lawyers will forgive the costs if you don’t receive a settlement or award. However, this is not always the case, so be sure to ask your lawyer about how costs are handled before you hire him or her. (For more information, see Who Pays for the Costs of Pursuing a Workers’ Compensation Case?)
You should discuss fees and costs with your lawyer at your initial consultation, before signing a fee agreement. If you are considering a settlement, your lawyer should also explain how much will be deducted in attorneys’ fees and costs. Below is an example of how a typical settlement might be distributed.
Example: A lawyer negotiates a $50,000 settlement in a disputed claim. The lawyer spent $1,500 on depositions, expert witness fees, and other costs. The lawyer invested significant time developing the case and negotiating with the insurance company. A workers’ comp judge might approve the following distribution:
Additional sums might be withheld from your portion of the settlement for unpaid medical bills, unpaid child support, and Medicare set-aside agreements. However, under Virginia law, workers’ compensation benefits are not taxable. (For more information, see our article on what might be taken out of workers’ comp settlements.)
At the end of your case, your lawyer will seek approval of his or her fees from the Commission. If your case goes to trial, the Commission will approve fees and costs in the written decision. If your case settles, legal fees and costs will be included in the settlement paperwork, which must be reviewed and approved by the Commission.
