Whitt & Del Bueno, Attorneys at Law

Leaders in defending workers' compensation claims.


Penalty Shot

By Mike Del Bueno

In certain situations, Virginia workers’ compensation benefits that are late in being paid to an injured employee have long been subject to a penalty (20% of the late payment). The penalty, or additional amount that gets paid to the injured employee, has served as a means of discouraging the slow payment of due compensation benefits. While the Commission and Virginia courts have in the past only applied the penalty to late compensation payments, and declined to assign penalties to other late payments, that is no longer the situation.

In a recently published case, Roman v. Ondeo Degremont, Inc., the Court of Appeals held that attorney fees to be deducted and paid from accrued compensation benefits are also subject to a penalty, if paid late. The Court of Appeals unanimously reversed the full Commission on this issue. The Court reasoned that attorney fees are still a part of the due compensation when deducted and paid from the same, and thus, subject to a penalty when late.

The Court declined to address the issue of whether late medical payments, or late attorney fees that are not to be deducted and paid from accrued compensation benefits, are subject to a penalty. How the Commission and the courts may rule in the future on those and other situations are up in the air, given the Roman opinion.

Based upon the Court’s holding in Roman, employers and carriers certainly must now be vigilant to ensure timely payment of not only compensation benefits to injured employees, but attorney fees deducted and paid from due compensation benefits as well. If you think that you might be in a penalty situation due to the late payment of attorney fees to the claimant’s counsel, feel free to give our offices a call and we will help you analyze the situation.