HLS 12RS-1108 ORIGINAL
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Regular Session, 2012
HOUSE BILL NO. 697
BY REPRESENTATIVE EDWARDS
WORKERS COMPENSATI ON: Provides for suits against third parties in workers'
compensation claims
AN ACT1
To amend and reenact R.S. 23:1101(B), 1102(B) and (C)(1), and 1103(B), relative to2
workers' compensation; to provide with respect to suits against third parties; to3
provide with respect to damages; to provide for apportionment of payment between4
the employer, employee, and a third party; to provide for the resolution of disputes;5
to provide penalties for employers; and to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 23:1101(B), 1102(B) and (C)(1), and 1103(B) are hereby amended8
and reenacted to read as follows:9
§1101. Employee and employer suits against third persons; effect on right to10
compensation11
* * *12
B. Any person having paid or having become obligated to pay compensation13
under pursuant to the provisions of this Chapter may bring suit in district court14
against such third person to recover any amount which he has paid or becomes15
obligated to pay as compensation to such employee or his dependents. The recovery16
allowed herein shall be identical in percentage to the recovery of the employee or his17
dependents against the third person, and where the recovery of the employee is18
decreased as a result of comparative negligence, the recovery of the person who has19
paid compensation or has become obligated to pay compensation shall be reduced20 HLS 12RS-1108 ORIGINAL
HB NO. 697
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by the same percentage. Regardless of the amount of the recovery by the employee1
or his dependents from suit against a third person, the amount of recovery or credit2
by the person having paid compensation benefits or obligated to pay compensation3
benefits shall be limited to the amount paid or obligated to be paid. The amount of4
any credit due the employer may be set in the judgment of the district court if agreed5
to by the parties; otherwise, it will be determined pursuant to the provisions of R.S.6
23:1102(A).7
* * *8
§1102. Employee or employer suits against third persons causing injury; notice of9
filing10
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B. If a compromise with such third person is made by the employee or his12
dependents, the employer or insurer shall be liable to the employee or his dependents13
for any benefits under pursuant to this Chapter which are in excess of the full amount14
paid by such third person, only after the employer or the insurer receives a dollar for15
dollar credit against the full amount paid in compromise for the recovery of lost16
wages and medical benefits, less attorney fees and costs paid by the employee in17
prosecution of the third party claim and only if written approval of such compromise18
is obtained from the employer or insurer by the employee or his dependent, at the19
time of or prior to such compromise. Written approval of the compromise must shall20
be obtained from the employer if the employer is self-insured, either in whole or in21
part. If the employee or his dependent fails to notify the employer or insurer of the22
suit against the third person or fails to obtain written approval of the compromise23
from the employer and insurer at the time of or prior to such compromise, the24
employee or his dependent shall forfeit the right to future compensation, including25
medical expenses. Notwithstanding the failure of the employer to approve such26
compromise, the employee's or dependent's right to future compensation in excess27
of the amount recovered from the compromise shall be reserved upon payment to the28
employer or insurer of the total amount of compensation benefits, and medical29 HLS 12RS-1108 ORIGINAL
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benefits, previously paid to or on behalf of the employee, exclusive of attorney fees1
arising out of the compromise; except in no event shall the amount paid to the2
employer or insurer exceed fifty percent of the total amount recovered from the3
compromise. Such reservation shall only apply after the employer or insurer4
receives a dollar for dollar credit against the full amount paid in compromise for the5
recovery of lost wages and medical benefits, less attorney fees and costs paid by the6
employee in prosecution of the third party claim.7
C.(1)(a) When a suit has been filed against a third party defendant in which8
the employer or his insurer has intervened, if the third party defendant or his insurer9
fails to obtain written approval of the compromise from the employer or his insurer10
at the time of or prior to such compromise and the employee fails to pay to the11
employer or his insurer the total amount of compensation benefits and medical12
benefits out of the funds received as a result of the compromise, the third party13
defendant or his insurer shall be required to reimburse the employer or his insurer14
to the extent of the total amount of compensation benefits and medical benefits15
previously paid to or on behalf of the employee to the extent said amounts have not16
been previously paid to the employer or his insurer by the employee pursuant to the17
provisions of Subsection B of this Section. Notwithstanding such payment, all rights18
of the employer or his insurer to assert the defense provided herein against the19
employee's claim for future compensation or medical benefits shall be reserved. For20
the purposes of this Paragraph, "funds" shall mean lost wages and medical benefits,21
not an award for pain and suffering or general damages.22
(b) In any third party compromise or settlement, reasonable amounts of any23
recovery shall provide for reasonable considerations distinguishing between special24
and general damages, and such amounts shall be expressly provided as agreed upon25
between the parties and the employer or compensation insurer.26
(c) If the employer or his insurer arbitrarily or unreasonably withholds its27
consent of the compromise between the third party and the employee, the employer28
or its insurer shall be liable for attorney fees and penalties. Such penalties shall be29 HLS 12RS-1108 ORIGINAL
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fixed at the amount of twelve percent of the compensation lien or up to eight1
thousand dollars, whichever is greater.2
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§1103. Damages; apportionment of between employer and employee in suits against4
third persons; compromise of claims; credit5
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B. The claim of the employer shall be satisfied in the manner described7
above from the first dollar of the judgment without regard to how the damages have8
been itemized or classified by the judge or jury. Such first dollar satisfaction shall9
be paid from the entire judgment, regardless of whether the judgment includes10
compensation for losses other than medical expenses and lost wages. but shall only11
include an award for damages of lost wages and medical expenses.12
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DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Edwards HB No. 697
Abstract: Provides with respect to recovery against third parties in workers' compensation
claims.
Present law allows any person who has paid or is obligated to pay workers' compensation
to sue a third party to recover any amount he has paid or is obligated to pay as compensation
to an employee or his dependents.
Present law provides that any recovery from a suit against a third party shall be in the same
percentage as the plaintiff has paid to the employee in workers' compensation. If the
recovery of the employee has been decreased by comparative negligence then the recovery
of the person who has paid or is obligated to pay compensation shall be reduced by the same
percentage. Any credit due the employer may be set in the judgment of the district court if
agreed by the parties otherwise it will be determined by statute.
Proposed law clarifies present law by restricting the reimbursement of workers'
compensation benefits paid or credits against obligations to pay by intervention in third
person suits to amounts actually paid or obligated to pay under the Workers' Compensation
Act.
Present law provides for notice of filing suit by an employee or employer. HLS 12RS-1108 ORIGINAL
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Present law provides that disputes between an employee and employer over calculation of
an employer's credits shall be resolved by a workers' compensation judge and that any
decision rendered shall not affect either party's rights.
Present law provides for employer or insurer credits in third party compromises and further
provides for written approval as well as notice of all compromises. Present law provides that
failure of an employee to report written compromise results is forfeiture of future
compensation and medical expenses.
Proposed law clarifies that employer or insurer recovery or credits in third party
compromises are limited to payments made or amounts recovered for lost wages and medical
benefits only.
Proposed law also provides for express distinction between special and general damages in
any compromise or settlement of third party claims and sets penalties for an employer or
insurer who arbitrarily or unreasonably withholds consent in the third party compromises
at 12% of the compensation lien or $8,000, whichever is greater.
Present law states that an employer's claim shall be satisfied from the first dollar of the
judgment without regard to how the damages have been itemized or classified by the trier
of fact. The satisfaction of the claim shall be made from the entire judgment regardless of
whether the judgment includes compensation for losses other than medical expenses and lost
wages.
Proposed law changes present law by requiring that the employer's claim be satisfied from
the first dollar of the judgment but shall only include an award for damages of lost wages
and medical expenses.
(Amends R.S. 23:1101(B), 1102(B) and (C)(1), and 1103(B))