How Do Workers’ Compensation Liens Work?
California law ensures that workers injured on the job be covered by workers’ compensation. Workers’ compensation is meant only to compensate workers for their injuries, however, rather than give them a windfall. If an injured worker can recover damages from another source, such as a personal injury lawsuit, then allowing them workers’ compensation coverage as well would double their recovery. California law allows for certain legal procedures to ensure that workers get the benefits they are owed, but not more, from workers’ compensation insurance. One such mechanism is the workers’ compensation lien. Continue reading to learn about workers’ compensation liens, and if you’ve been hurt on the job in Southern California, reach out to a dedicated Riverside workers’ compensation lawyer for assistance.
What is a Lien?
A lien is a form of security interest granted over an item of property to secure payment of a debt or other obligation. A lien may be placed on a house, for example, so that when the house is sold, a creditor gets a portion of the sale proceeds to repay their debt. A lien can take the form of a legal right against certain assets, such as a personal injury judgment.
What is a Workers’ Compensation Lien?
Workers’ compensation provides specific benefits to an injured worker. Workers’ comp pays for medical expenses, lost wages, and disability caused by the accident. Workers’ comp is meant to compensate the injured worker, not reward them. If an injured worker’s medical costs and other expenses are already being compensated by another source, then the workers’ comp insurer is not obligated to double the worker’s recovery.
Sometimes, a worker is injured by a third party unrelated to the employer. For example, an employee may be making a work-related delivery when they are hit by a drunk driver. The worker is still technically entitled to workers’ comp benefits because the accident happened on the job. However, the drunk driver is also likely liable for the injury they caused the worker. The worker has their own personal injury claim they can file against the drunk driver, under which they can recover for their medical expenses, lost wages, as well as additional damages such as pain and suffering.
If you have a viable personal injury claim against a third party, your workers’ comp insurer has the right to register a lien against your personal injury award. That means they will be able to take some of your personal injury award to recoup their costs in providing you workers’ comp benefits. They have the right to recover for the expenses they paid that are covered by your personal injury award, such as your medical costs.
How Much is the Lien?
Workers’ comp insurers only collect on their workers’ comp lien if you bring a third-party injury claim and are successful. Insurers thus prefer that injured workers pursue all the third-party claims they can, instead of relying on the automatic workers’ comp coverage. For that reason, insurers are often willing to negotiate the amount of their lien. They know if their lien meets or exceeds the potential personal injury recovery, then the worker has no incentive to bring the lawsuit at all. Your workers’ comp attorney can help you negotiate a favorable, reduced lien so that you can collect your workers’ comp benefits and still gain additional damages for your personal injury claim.
Get the Workers’ Comp Benefits You Deserve
For help getting benefits after an on-the-job injury or workplace illness in Southern California, call Ochoa & Calderon to discuss your case with an experienced and effective California workers’ comp lawyer. Call 951-901-4444 in Riverside or 844-401-0750 toll-free throughout Southern California.