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Florida Workers Compensation Lien

The workers’ compensation system is designed to provide injured employees with medical and wage loss benefits. Jones v. Martin Elecs., Inc., 932 So.2d, 1104 (Fla.2006).

If you are injured on the job or in the scope of your employment you may have a worker’s compensation claim against your employer/insurance company and you may also have a claim any negligent third-parties.

The injured employee has one year from the date of accident/injury to file a lawsuit against the negligent third-party. The employer, the party paying the worker’ compensation benefits has two years to bring suit. “At the end of the second year, the rights of action revert to the employee, but are (as before) subject to the employer or insurer’s subrogation and lien rights.” Luscomb v. Liberty Mut. Ins. Co., 967 So. 2d 379, 381 (Fla. Dist. Ct. App. 2007).

Although, you may have a workers’ compensation claim against your employer and a claim against any negligent third-party you will not be able to double dip. Florida Statute 440.39 (2020); Jones v. Martin Elecs., Inc., 932 So.2d 1100, 1108 (Fla.2006).

posterwithcaption-1-300x248 Florida Statute 440.39 (2020) mandates that an employer who has provided benefits to an injured employee is entitled to place a lien on a settlement from a third-party for the amount that the employer has paid in benefits.  The employer can also elect to waive the lien. An employer providing workers’ compensation benefits to an injured employee can place a lien on any monies paid out for medical, wage loss benefits as well as future medical benefits that are part of an employee’s settlement with a negligent third-party. City of Lakeland v. Stapleton, 875 So. 2d 784 (Fla. Dist. Ct. App. 2004).

 

 

 

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The calculations for payment of the the workers compensation lien significantly differ if it is a State WC lien under FSA 440.39(3)(a) or under the Federal Employees’ Compensation Act (FECA).  But what about when calculating Defense Base Act (DBA) liens – which is merely an extension of the Federal Worker’s Compensation program?  Below is a precursory analysis of how liens are calculated and based on same, it’s clear Florida and DBA lien calculations are not nearly as complex as FECA calculations.

Florida Worker’s Compensation Lien Calculation:

Under Florida’s 3rd party lien law, Worker’s Compensation (WC) carriers are entitled to recover 100% of past and future payments, but…. the same law reduces this recovery by the carrier’s proportionate share of the injured worker’s attorney fees/costs and any reductions considering the injured workers own negligence in the settlement. It is very important the injured person’s attorney argue the injured worker did not get the full value of the case because he was partly at fault.

When a WC carrier has provided benefits to the injured worker, the Carrier has a lien up to the full amount it has paid.  The lien may be waived if the injured person gives up his right to future benefits.  When it is not waived, the amount the injured worker must pay back is determined by the Manfredo Formula.  See Manfredo v. Employer’s Casualty Insurance Company, 560 So.2d 1162 (Fla 1990). The formula, as set forth in the statute, can be difficult to understand.  The formula has not changed since I posted on this in 2013. However, the easiest way to understand the “Manfredo Formula” is by example:accounting-calculator-1-1241522-300x225

The case of Manfredo v. Employer’s Casualty Ins. Co., 560 So.2d 1162 (Fla. 1990) provides for the formula to use for the Florida state wc lien repayment.  Assume the third party settlement of $275,000.00 is divided by our client’s net tort recovery, which is $127,124.80. This amount is arrived at by deducting our one-third for attorney’s fees and costs along with the outstanding medical bills as our client had surgeries outside of workers’ compensation. Divide $127,124.80. that he will receive over the full value of the case, $275,000.00, equals a 46% payback.  That 46% payback times the wc lien of $20,359.38 calls for us to pay the lien holder $9,441.57.

Now is this formula used when calculating FECA liens or DBA liens?  The short answer is NO

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