A Section 10(f) Increase Is “Greater Compensation”

In a new published opinion, the Benefits Review Board determined that claimant’s counsel was entitled to shifting attorneys fees because an award of Section 10(f) increases amounted to an award of “greater compensation” for purposes of the Longshore and Harbor Workers’ Compensation Act’s attorney fee provisions.  In Wilson, the claimant worked as a truck driver for employer at the time he injured his neck, spine and right knee.  The employer voluntarily paid claimant temporary total disability benefits at the maximum compensation rate, and claimant filed a claim for permanent total disability (“PTD”) benefits.  Thereafter, an informal conference was held by correspondence, and the district director issued a recommendation that claimant was entitled to PTD benefits until suitable alternative employment was demonstrated.  Further, the lower court determined that claimant was entitled to continuing PTD benefits and Section 10(f) increases, but it nonetheless refused to shift attorneys fees.

The Board determined that while the district director did not specifically mention Section 10(f), “that a recommendation for permanent total disability benefits necessarily incorporates Section 10(f) adjustments.”  As such, a recommendation for PTD benefits includes Section 10(f) adjustments, and a district director does not have to address Section 10(f) individually because it is already included in a PTD award by statute.

Attorneys fees under Section 28(b) require the satisfaction of four elements: (1) an informal conference must be held; (2) the district director must issue a written recommendation; (3) the employer must reject the recommendation; and (4) the claimant must obtain greater compensation than that paid or tendered by employer after its rejection of the district director’s recommendation.  The Board determined in Wilson that claimant successfully secured greater compensation because Section 10(f) cost-of-living adjustments result in an annual indemnity benefits increase.  As a result, Section 28(b) was properly invoked and fees could shift.

Wilson v. Service Emp. Int’l, No. 10-0261 (Ben. Rev. Bd. 2010).

Note: The Board did not address that portion of Section 28(b) that discusses the monetary limits of a fee award.  Specifically, fees under Section 28(b) can only equal “a reasonable attorney’s fee based solely upon the difference between the amount awarded and the amount tendered or paid…”.  This provision of Section 28(b) fell beyond the scope of the Board’s decision–which focused on the right to fees and not the amount of fees–but it nonetheless poses an interesting question.  If the “greater compensation” achieved is limited to a 3.47% increase (which was the percent increase applied in 2008), then should the amount of any fees likewise be limited to this small amount?  Most likely, this question must be answered in the affirmative because courts have interpreted Section 28(b) as containing an “explicit limitation” on the amount due for attorney’s fees.  Dyer v. Cenex Harvest States Coop., 563 F.3d 1044, 1049 (9th Cir. 2009) (“This explicit limitation is evidence that when Congress wanted to limit attorney’s fees in the LHWCA beyond the well-known standard of ‘a reasonable attorney’s fee,’ it did so explicitly”).