Workers’ Compensation Liens

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Many people are familiar with the term “lien” when it applies to property. For example, if a homeowner is in debt to a creditor, that creditor may place a lien on the house. If the homeowner does not repay the debt, the creditor can apply for a property lien. This is the first step towards granting the creditor a legal claim to the property, which could eventually be repossessed or seized. Liens can also be placed on other real estate, cars, boats, and other property.

Workers’ Compensation liens are based on the same principle. In certain states, including Delaware, an employee that receives Workers’ Compensation benefits plus a settlement from a third party may have a lien placed on that settlement by their employer’s insurance company. This is done so the employer can get reimbursed by the third party for the benefits they paid out for the worker’s lost wages and medical costs.

What Delaware Workers’ Compensation Covers

To qualify for Workers’ Compensation in Delaware, the accident and subsequent injury must have happened at work or while the employee was doing normal work assignments.

Benefits are provided for qualifying medical expenses, partial wage replacement; lump sum payouts may be paid for permanent disabilities and permanent loss of the use of certain body parts.

Third-Party Lawsuits

Many workers initiate claims against third parties when the work injury was not caused by themselves, a work colleague, or their employer. Workplace accidents can be caused by defective machinery, faulty building construction, contractors, and other supplies provided by property owners and manufacturers.

The injured worker may very well qualify for Workers’ Compensation, but can also file a personal injury suit against the third party. These lawsuits seek compensation for things that Workers’ Compensation does not cover, like pain and suffering.

Once the third-party claims are settled, the employer’s insurance company may proceed with placing a lien, in order to recover total or partial reimbursement of what they have paid to the worker.

Negotiation and Litigation

Delaware has a two-year statute of limitations for Workers’ Compensation liens. In addition, the employer may go after the third-party directly for compensation, if the employee does not institute a personal injury claim within 260 days.

These liens can be large, and can deter the worker from carrying out a personal injury lawsuit. In general, Workers’ Compensation liens are around two-thirds of what was paid out to the employee. In some cases, the lien amount is even greater than the amount that the worker would get if they won their case.

Due to the complexity of a third-party claim in addition to Workers’ Compensation, it is important to consult a Milford Workers’ Compensation lawyer.

Oftentimes the employee’s lawyer will negotiate with the Workers’ Compensation insurance company. This can result in decreasing the amount of the lien. The insurance carrier usually covers their share of the litigation costs in these situations.

Milford Workers’ Compensation Lawyers at Rhoades & Morrow Help with Workers’ Compensation Liens

Workers’ Compensation claims can be complicated by personal injury lawsuits, but a capable and experienced Milford Workers’ Compensation lawyer at Rhoades & Morrow can help with your case. We serve clients throughout the state of Delaware, including Elsmere and Seaford. For a free consultation, contact us online or call us at our Milford office at (302) 422-6705, our Wilmington office at (302) 427-9500, or our Bear office at 302-824-8484.


Delaware Injury Lawyers

R & M Lawyers
Rhoades & Morrow

Our attorneys provide exceptional legal service with a personal touch. Since our founding in 1990, we have helped thousands of Delaware citizens obtain full and just compensation for personal injury claims. We have gained an excellent reputation as the “go to” law firm. Let us put our decades of experience to work for you.

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