HJC/HB 66
Page 1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
AN ACT
RELATING TO WORKERS' COMPENSATION; INCREASING THE AMOUNT OF
MONEY THAT CAN BE ADVANCED BY EMPLOYERS FOR DISCOVERY COSTS;
INCREASING THE MAXIMUM AMOUNT OF ATTORNEY FEES THAT CAN BE
COLLECTED IN A WORKERS' COMPENSATION OR OCCUPATIONAL DISEASE
DISABLEMENT CASE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 52-1-54 NMSA 1978 (being Laws 1987,
Chapter 235, Section 24, as amended) is amended to read:
"52-1-54. FEE RESTRICTIONS--APPOINTMENT OF ATTORNEYS BY
THE DIRECTOR OR WORKERS' COMPENSATION JUDGE--DISCOVERY
COSTS--OFFER OF JUDGMENT--PENALTY FOR VIOLATIONS.--
A. It is unlawful for any person to receive or
agree to receive any fees or payment directly or indirectly
in connection with any claim for compensation under the
Workers' Compensation Act except as provided in this section.
B. In all cases where the jurisdiction of the
workers' compensation administration is invoked to approve a
settlement of a compensation claim under the Workers'
Compensation Act, the director or workers' compensation
judge, unless the claimant is represented by an attorney, may
in the director's or judge's discretion appoint an attorney
to aid the workers' compensation judge in determining whether
the settlement should be approved and, in the event of an HJC/HB 66
Page 2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
appointment, a reasonable fee for the services of the
attorney shall be fixed by the workers' compensation judge,
subject to the limitation of Subsection I of this section.
C. In all cases where the jurisdiction of the
workers' compensation administration is invoked to approve a
settlement of a compensation claim under the Workers'
Compensation Act and the claimant is represented by an
attorney, the total amount paid or to be paid by the employer
in settlement of the claim shall be stated in the settlement
papers. The workers' compensation judge shall determine and
fix a reasonable fee for the claimant's attorney, taking into
account any sum previously paid, and the fee fixed by the
workers' compensation judge shall be the limit of the fee
received or to be received by the attorney in connection with
the claim, subject to the limitation of Subsection I of this
section.
D. The cost of discovery shall be borne by the
party who requests it. If, however, the claimant requests
any discovery, the employer shall advance the cost of paying
for discovery up to a limit of three thousand five hundred
dollars ($3,500). Beginning January 1, 2027, the limit shall
be four thousand dollars ($4,000), and beginning January 1,
2029, the limit shall increase to four thousand five hundred
dollars ($4,500). If the claimant substantially prevails on
the claim, as determined by a workers' compensation judge, HJC/HB 66
Page 3
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
any discovery cost advanced by the employer shall be paid by
that employer. If the claimant does not substantially
prevail on the claim, as determined by a workers'
compensation judge, the employer shall be reimbursed for
discovery costs advanced according to a schedule for
reimbursement approved by a workers' compensation judge.
E. In all cases where compensation to which any
person is entitled under the provisions of the Workers'
Compensation Act is refused and the claimant thereafter
collects compensation through proceedings before the workers'
compensation administration or courts in an amount in excess
of the amount offered in writing by an employer five business
days or more prior to the informal hearing before the
administration, the compensation to be paid the attorney for
the claimant shall be fixed by the workers' compensation
judge hearing the claim or the courts upon appeal in the
amount the workers' compensation judge or courts deem
reasonable and proper, subject to the limitation of
Subsection I of this section. In determining and fixing a
reasonable fee, the workers' compensation judge or courts
shall take into consideration:
(1) the sum, if any, offered by the
employer:
(a) before the worker's attorney was
employed; HJC/HB 66
Page 4
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
(b) after the attorney's employment but
before proceedings were commenced; and
(c) in writing five business days or
more prior to the informal hearing;
(2) the present value of the award made in
the worker's favor; and
(3) any failure of a party to participate in
a good-faith manner in informal claim resolution methods
adopted by the director.
F. After a recommended resolution has been issued
and rejected, but more than ten days before a trial begins,
the employer or claimant may serve upon the opposing party an
offer to allow a compensation order to be taken against the
employer or claimant for the money or property or to the
effect specified in the offer, with costs then accrued,
subject to the following:
(1) if, within ten days after the service of
the offer, the opposing party serves written notice that the
offer is accepted, either party may then file the offer and
notice of acceptance together with proof of service thereof,
and thereupon that compensation order may be entered as the
workers' compensation judge may direct. An offer not
accepted shall be deemed withdrawn, and evidence thereof is
not admissible except in a proceeding to determine costs. If
the compensation order finally obtained by the party is not HJC/HB 66
Page 5
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
more favorable than the offer, that party shall pay the costs
incurred by the opposing party after the making of the offer.
The fact that an offer has been made but not accepted does
not preclude a subsequent offer;
(2) when the liability of one party to
another has been determined by a compensation order, but the
amount or extent of the liability remains to be determined by
further proceedings, the party adjudged liable may make an
offer, which shall have the same effect as an offer made
before trial if it is served within a reasonable time not
less than ten days prior to the commencement of hearings to
determine the amount or extent of liability;
(3) if the employer's offer was greater than
the amount awarded by the compensation order, the employer
shall not be liable for the employer's fifty percent share of
the attorney fees to be paid the worker's attorney and the
worker shall pay one hundred percent of the attorney fees due
to the worker's attorney; and
(4) if the worker's offer was less than the
amount awarded by the compensation order, the employer shall
pay one hundred percent of the attorney fees to be paid the
worker's attorney, and the worker shall be relieved from any
responsibility for paying any portion of the worker's
attorney fees.
G. In all actions arising under the provisions of HJC/HB 66
Page 6
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Section 52-1-56 NMSA 1978 where the jurisdiction of the
workers' compensation administration is invoked to determine
the question whether the claimant's disability has increased
or diminished and the claimant is represented by an attorney,
the workers' compensation judge or courts upon appeal shall
determine and fix a reasonable fee for the services of the
claimant's attorney only if the claimant is successful in
establishing that the claimant's disability has increased or
if the employer is unsuccessful in establishing that the
claimant's disability has diminished. The fee when fixed by
the workers' compensation judge or courts upon appeal shall
be the limit of the fee received or to be received by the
attorney for services in the action, subject to the
limitation of Subsection I of this section.
H. In determining reasonable attorney fees for a
claimant, the workers' compensation judge shall consider only
those benefits to the worker that the attorney is responsible
for securing. The value of future medical benefits shall not
be considered in determining attorney fees.
I. Attorney fees, including, but not limited to,
the costs of paralegal services, legal clerk services and any
other related legal services costs on behalf of a claimant or
an employer for a single accidental injury claim, including
representation before the workers' compensation
administration and the courts on appeal, shall not exceed HJC/HB 66
Page 7
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
thirty thousand dollars ($30,000) in calendar year 2025.
Beginning January 1, 2027, the maximum allowable attorney
fees shall be thirty-two thousand dollars ($32,000), and
beginning January 1, 2029, the maximum allowable attorney
fees shall increase to thirty-four thousand dollars
($34,000). This limitation applies whether the claimant or
employer has one or more attorneys representing the claimant
or employer and applies as a cumulative limitation on
compensation for all legal services rendered in all
proceedings and other matters directly related to a single
accidental injury to a claimant. The workers' compensation
judge may exceed the maximum amount stated in this subsection
in awarding a reasonable attorney fee if the judge finds that
a claimant, an insurer or an employer acted in bad faith with
regard to handling the injured worker's claim and the injured
worker or employer has suffered economic loss as a result.
However, in no case shall this additional amount exceed five
thousand dollars ($5,000). As used in this subsection, "bad
faith" means conduct by the claimant, insurer or employer in
the handling of a claim that amounts to fraud, malice,
oppression or willful, wanton or reckless disregard of the
rights of the worker or employer. Any determination of bad
faith shall be made by the workers' compensation judge
through a separate fact-finding proceeding. Notwithstanding
the provisions of Subsection J of this section, the party HJC/HB 66
Page 8
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
found to have acted in bad faith shall pay one hundred
percent of the additional fees awarded for representation of
the prevailing party in a bad faith action.
J. Except as provided in Paragraphs (3) and (4) of
Subsection F of this section, the payment of a claimant's
attorney fees determined under this section shall be shared
equally by the worker and the employer.
K. It is unlawful for any person except a licensed
attorney to receive or agree to receive any fee or payment
for legal services in connection with any claim for
compensation under the Workers' Compensation Act.
L. Nothing in this section applies to agents,
excluding attorneys, representing employers, insurance
carriers or the subsequent injury fund in any matter arising
from a claim under the Workers' Compensation Act.
M. No attorney fees shall be paid until the claim
has been settled or adjudged.
N. By May 1, 2029, the advisory council on
workers' compensation and occupational disease disablement
shall review the maximum allowable attorney fees and the
limitation on discovery costs that employers are required to
advance. By November 1, 2029, the advisory council on
workers' compensation and occupational disease disablement
shall make recommendations to the legislature on any
necessary adjustments to the maximum allowable attorney fees HJC/HB 66
Page 9
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
or the limitation on discovery costs that employers are
required to advance.
O. Every person violating the provisions of this
section is guilty of a misdemeanor and upon conviction shall
be fined not less than fifty dollars ($50.00) or more than
five hundred dollars ($500), to which may be added
imprisonment in the county jail for a term not exceeding
ninety days.
P. Nothing in this section shall restrict a
claimant from being represented before the workers'
compensation administration by a nonattorney as long as that
nonattorney receives no compensation for that representation
from the claimant."
SECTION 2. Section 52-3-47 NMSA 1978 (being Laws 1987,
Chapter 235, Section 41, as amended) is amended to read:
"52-3-47. FEE RESTRICTIONS--APPOINTMENT OF ATTORNEYS BY
THE DIRECTOR OR WORKERS' COMPENSATION JUDGE--DISCOVERY
COSTS--OFFER OF JUDGMENT--PENALTY FOR VIOLATIONS.--
A. It is unlawful for any person to receive or
agree to receive any fees or payment directly or indirectly
in connection with any claim for compensation under the New
Mexico Occupational Disease Disablement Law except as
provided in this section.
B. In all cases where the jurisdiction of the
workers' compensation administration is invoked to approve a HJC/HB 66
Page 10
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
settlement of a compensation claim under the New Mexico
Occupational Disease Disablement Law, the director or
workers' compensation judge, unless the claimant is
represented by an attorney, may in the director's or judge's
discretion appoint an attorney to aid the workers'
compensation judge in determining whether the settlement
should be approved. In the event of such an appointment, a
reasonable fee for the services of the attorney shall be
fixed by the workers' compensation judge, subject to the
limitation of Subsection I of this section.
C. In all cases where the jurisdiction of the
workers' compensation administration is invoked to approve a
settlement of a compensation claim under the New Mexico
Occupational Disease Disablement Law and the claimant is
represented by an attorney, the total amount paid or to be
paid by the employer in settlement of the claim shall be
stated in the settlement papers, and the workers'
compensation judge shall determine and fix a reasonable fee
for the claimant's attorney, taking into account any sum
previously paid. The fee fixed by the workers' compensation
judge shall be the limit of the fee received or to be
received by the attorney in connection with the claim,
subject to the limitation of Subsection I of this section.
D. The cost of discovery shall be borne by the
party who requests it. If, however, the claimant requests HJC/HB 66
Page 11
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
any discovery, the employer shall advance the cost of paying
for discovery up to a limit of three thousand five hundred
dollars ($3,500). Beginning January 1, 2027, the limit shall
be four thousand dollars ($4,000), and beginning January 1,
2029, the limit shall increase to four thousand five hundred
dollars ($4,500). If the claimant substantially prevails on
the claim, as determined by a workers' compensation judge,
any discovery cost advanced by the employer shall be paid by
that employer. If the claimant does not substantially
prevail on the claim, as determined by a workers'
compensation judge, the employer shall be reimbursed for
discovery costs advanced according to a schedule for
reimbursement approved by a workers' compensation judge.
E. In all cases where compensation to which any
person is entitled under the provisions of the New Mexico
Occupational Disease Disablement Law is refused and the
claimant thereafter collects compensation through proceedings
before the workers' compensation administration or courts in
an amount in excess of the amount offered in writing by an
employer five business days or more prior to the informal
hearing before the administration, the compensation to be
paid the attorney for the claimant shall be fixed by the
workers' compensation judge hearing the claim or the courts
upon appeal in the amount the workers' compensation judge or
courts deem reasonable and proper, subject to the limitation HJC/HB 66
Page 12
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
of Subsection I of this section. In determining and fixing a
reasonable fee, the workers' compensation judge or courts
shall take into consideration:
(1) the sum, if any, offered by the
employer:
(a) before the employee's attorney was
employed;
(b) after the attorney's employment but
before proceedings were commenced; and
(c) in writing five business days or
more prior to the informal hearing;
(2) the present value of the award made in
the employee's favor; and
(3) the failure of a party to participate in
a good-faith manner in informal claim resolution methods
adopted by the director.
F. After a recommended resolution has been issued
and rejected, but more than ten days before a trial begins,
the employer or claimant may serve upon the opposing party an
offer to allow a compensation order to be taken against the
employer or claimant for the money or property or to the
effect specified in the offer, with costs then accrued,
subject to the following:
(1) if, within ten days after the service of
the offer, the opposing party serves written notice that the HJC/HB 66
Page 13
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
offer is accepted, either party may then file the offer and
notice of acceptance together with proof of service thereof,
and thereupon that compensation order may be entered as the
workers' compensation judge may direct. An offer not
accepted shall be deemed withdrawn, and evidence thereof is
not admissible except in a proceeding to determine costs. If
the compensation order finally obtained by the party is not
more favorable than the offer, that party shall pay the costs
incurred by the opposing party after the making of the offer.
The fact that an offer has been made but not accepted does
not preclude a subsequent offer;
(2) when the liability of one party to
another has been determined by a compensation order, but the
amount or extent of the liability remains to be determined by
further proceedings, the party adjudged liable may make an
offer, which shall have the same effect as an offer made
before trial if it is served within a reasonable time not
less than ten days prior to the commencement of hearings to
determine the amount or extent of liability;
(3) if the employer's offer was greater than
the amount awarded by the compensation order, the employer
shall not be liable for the employer's fifty-percent share of
the attorney fees to be paid the worker's attorney and the
worker shall pay one hundred percent of the attorney fees due
to the worker's attorney; and HJC/HB 66
Page 14
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
(4) if the worker's offer was less than the
amount awarded by the compensation order, the employer shall
pay one hundred percent of the attorney fees to be paid the
worker's attorney, and the worker shall be relieved from any
responsibility for paying any portion of the worker's
attorney fees.
G. In all actions arising under the provisions of
Section 52-3-35 NMSA 1978, where the jurisdiction of the
workers' compensation administration is invoked to determine
the question of whether the claimant's disablement has
terminated and the claimant is represented by an attorney,
the workers' compensation judge or courts upon appeal shall
determine and fix a reasonable fee for the services of the
claimant's attorney only if the employer is unsuccessful in
establishing that the claimant's disablement has terminated.
The fee when fixed by the workers' compensation judge or
courts upon appeal shall be taxed as part of the costs
against the employer and shall be the limit of the fee
received or to be received by the attorney for services in
the action, subject to the limitation of Subsection I of this
section.
H. In determining reasonable attorney fees for a
claimant, the workers' compensation judge shall consider only
those benefits to the employee that the attorney is
responsible for securing. The value of future medical HJC/HB 66
Page 15
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
benefits shall not be considered in determining attorney
fees.
I. Attorney fees, including, but not limited to,
the costs of paralegal services, legal clerk services and any
other related legal services costs on behalf of a claimant or
an employer for a single disablement claim, including
representation before the workers' compensation
administration and the courts on appeal, shall not exceed
thirty thousand dollars ($30,000) in calendar year 2025.
Beginning January 1, 2027, the maximum allowable attorney
fees shall be thirty-two thousand dollars ($32,000), and
beginning January 1, 2029, the maximum allowable attorney
fees shall increase to thirty-four thousand dollars
($34,000). This limitation applies whether the claimant or
employer has one or more attorneys representing the claimant
or employer and applies as a cumulative limitation on
compensation for all legal services rendered in all
proceedings and other matters directly related to a single
occupational disease of a claimant. The workers'
compensation judge may exceed the maximum amount stated in
this subsection in awarding a reasonable attorney fee if the
judge finds that a claimant, an insurer or an employer acted
in bad faith with regard to handling the disabled employee's
claims and the employer or disabled employee has suffered
economic loss as a result thereof. However, in no case shall HJC/HB 66
Page 16
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
this additional amount exceed five thousand dollars ($5,000).
As used in this subsection, "bad faith" means conduct by the
claimant, insurer or employer in the handling of a claim that
amounts to fraud, malice, oppression or willful, wanton or
reckless disregard of the rights of the employee or employer.
Any determination of bad faith shall be made by the workers'
compensation judge through a separate fact-finding
proceeding. Notwithstanding the provisions of Subsection J
of this section, the party found to have acted in bad faith
shall pay one hundred percent of the additional fees awarded
for representation of the prevailing party in a bad faith
action.
J. Except as provided in Paragraphs (3) and (4) of
Subsection F of this section, the payment of a claimant's
attorney fees determined under this section shall be shared
equally by the employee and the employer.
K. It is unlawful for any person except a licensed
attorney to receive or agree to receive any fee or payment
for legal services in connection with any claim for
compensation under the New Mexico Occupational Disease
Disablement Law.
L. Nothing in this section applies to agents,
excluding attorneys, representing employers, insurance
carriers or the subsequent injury fund in any matter arising
from a claim under the New Mexico Occupational Disease HJC/HB 66
Page 17
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Disablement Law.
M. No attorney fees shall be paid until the claim
has been settled or adjudged.
N. By May 1, 2029, the advisory council on
workers' compensation and occupational disease disablement
shall review the maximum allowable attorney fees and the
limitation on discovery costs that employers are required to
advance. By November 1, 2029, the advisory council on
workers' compensation and occupational disease disablement
shall make recommendations to the legislature on any
necessary adjustments to the maximum allowable attorney fees
or the limitation on discovery costs that employers are
required to advance.
O. Every person violating the provisions of this
section is guilty of a misdemeanor and upon conviction shall
be fined not less than fifty dollars ($50.00) or more than
five hundred dollars ($500), to which may be added
imprisonment in the county jail for a term not exceeding
ninety days.
P. Nothing in this section shall restrict a
claimant from being represented before the workers'
compensation administration by a nonattorney as long as that
nonattorney receives no compensation for representation from
the claimant."