H. B. 3182
(By Mr. Speaker, Mr. Kiss)
[Introduced February 21, 2003; referred to the
Committee on Finance.]
A BILL to amend and reenact section six, article two, chapter
twenty-one-a of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to powers and duties
of the of the commissioner of the bureau of employment
programs; requiring proposals from attorneys to be on both an
hourly and a contingent fee basis; attorney invoices;
limitation on attorney fees; evidence; notification to
employer of audit commencement and results; time limits;
limitation on commissioner where procedure not followed; and
providing definition.
Be it enacted by the Legislature of West Virginia:
That section six, article two, chapter twenty-one-a of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted, to read as follows:
ARTICLE 2. THE COMMISSIONER OF THE BUREAU OF EMPLOYMENT PROGRAMS.
§21A-2-6. Powers and duties generally.
The commissioner is the executive and administrative head of
the bureau and has the power and duty to:
(1) Exercise general supervision of and make rules for the
government of the bureau;
(2) Prescribe uniform rules pertaining to investigations,
departmental hearings, and promulgate rules;
(3) Supervise fiscal affairs and responsibilities of the
bureau;
(4) Prescribe the qualifications of, appoint, remove, and fix
the compensation of the officers and employees of the bureau,
subject to the provisions of section ten, article four of this
chapter, relating to the board of review;
(5) Organize and administer the bureau so as to comply with
the requirements of this chapter and chapter twenty-three of this
code and to satisfy any conditions established in applicable
federal legislation;
(6) Make reports in such form and containing such information
as the United States department of labor may from time to time
require, and comply with such provisions as the United States
department of labor may from time to time find necessary to assure
the correctness and verification of such reports;
(7) Make available to any agency of the United States charged
with the administration of public works or assistance through public employment, upon its request, the name, address, ordinary
occupation and employment status of each recipient of unemployment
compensation, and a statement of the recipient's rights to further
compensation under this chapter;
(8) Keep an accurate and complete record of all bureau
proceedings; record and file all bonds and contracts and assume
responsibility for the custody and preservation of all papers and
documents of the bureau;
(9) Sign and execute in the name of the state, by "The Bureau
of Employment Programs", any contract or agreement with the federal
government, its agencies, other states, their subdivisions, or
private persons;
(10) Prescribe a salary scale to govern compensation of
appointees and employees of the bureau;
(11) Make the original determination of right in claims for
benefits;
(12) Make recommendations and an annual report to the governor
concerning the condition, operation, and functioning of the bureau;
(13) Invoke any legal or special remedy for the enforcement of
orders or the provisions of this chapter and chapter twenty-three
of this code;
(14) Exercise any other power necessary to standardize
administration, expedite bureau business, assure the establishment
of fair rules and promote the efficiency of the service;
(15) Keep an accurate and complete record and prepare a
monthly report of the number of persons employed and unemployed in
the state, which report shall be made available upon request to
members of the public and press;
(16) Provide at bureau expense a program of continuing
professional, technical and specialized instruction for the
personnel of the bureau;
(17) In addition to the authority granted to the commissioner
by section eighteen of this article and notwithstanding anything to
the contrary elsewhere in this code, utilize any attorney regularly
employed by the bureau or the office of the attorney general to
represent the commissioner, the bureau or any of its divisions in
any matter. In addition, the commissioner, with the approval of
the compensation programs performance council, is authorized to
retain counsel for any purpose in the administration of this
chapter or in the administration of chapter twenty-three of this
code relating to the collection of any amounts due from employers
to the bureau or any of its divisions. The compensation programs
performance council shall solicit proposals from counsel who are
interested in representing the commissioner, the bureau or any of
its divisions under the terms of this subdivision. These proposals
shall be solicited on an hourly basis and on a contingent fee
basis. Thereafter, the compensation programs performance council
shall select such attorneys as it determines necessary to pursue the collection objectives of this subdivision.
(A) Payment to any such retained counsel may either be by
hourly or other fixed fee, or as determined by the court or
administrative law judge as provided for below. A contingency fee
payable from the amount recovered by judgment or settlement for the
commissioner, the bureau or any of its divisions is only permitted,
to the extent not prohibited by federal law, when the assets of a
defendant or respondent are depleted so that a full recovery plus
attorneys' fees is not possible. The performance counsel shall
require that the attorneys selected provide an accurate invoice on
an hourly basis and on a contingent fee basis, and where the hourly
basis is less than one half of the invoice prepared on the
contingent fee basis, the attorney is limited to the hourly fee
amount only plus reasonable expenses.
(B) In the event that any collections action, other than a
collections action against a claimant, initiated either by retained
counsel or other counsel on behalf of the commissioner, the bureau
or any of its divisions results in a judgment or settlement in
favor of the commissioner, the bureau or any of its divisions, then
the court or, if there was no judicial component to the action, the
administrative law judge, shall determine the amount of attorneys'
fees that shall be paid by the defendants or respondents to the
retained or other counsel representing the commissioner, the bureau
or any of its divisions. If the court is to determine the amount of attorneys' fees, it shall include in its determination the
amount of fee that should be paid for the representation of the
commissioner, the bureau or its divisions in pursuing the
administrative component, if any, of the action. The amount so
paid shall be fixed by the court or the administrative law judge in
an amount no less than twenty percent of its recovery. Any
additional amount of attorneys' fees shall be determined by use of
the following factors:
(i) The counsel's normal hourly rate or, if the counsel is an
employee of the bureau or is an employee of the office of the
attorney general, such hourly rate as the court or the
administrative law judge shall determine to be customary based upon
the attorney's experience and skill level;
(ii) The number of hours actually expended on the action;
(iii) The complexity of the issues involved in the action;
(iv) The degree of risk involved in the case with regard to
the probability of success or failure;
(v) The overhead costs incurred by counsel with regard to the
use of paralegals and other office staff, experts, and
investigators; and
(vi) The public purpose served or public objective achieved by
the attorney in obtaining the judgment or settlement on behalf of
the commissioner, the bureau or any of its divisions.
(C) Notwithstanding the provisions of paragraph (B) of this subdivision, if the commissioner, bureau or any of its divisions
and the defendants or respondents to any administrative or judicial
action settle the action, then the parties may negotiate a separate
settlement of attorneys' fees to be paid by the defendants or
respondents above and beyond the amount recovered by the
commissioner, the bureau or any its divisions. In the event that
such a settlement of attorneys' fees is made, it must be submitted
to the court or administrative law judge for approval.
(D) Any attorney regularly employed by the bureau or by the
office of the attorney general may not receive any remuneration for
his or her services other than such attorney's regular salary. Any
attorneys' fees awarded for such an employed attorney shall be
payable to the commissioner;
(18) With the approval of the compensation programs
performance council created pursuant to section one, article three
of this chapter, to promulgate rules under which agencies of this
state shall not grant, issue, or renew any contract, license,
permit, certificate, or other authority to conduct a trade,
profession, or business to or with any employing unit whose account
is in default with the commissioner with regard to the
administration of this chapter and with regard to the
administration of chapter twenty-three of this code. The term
"agency" includes any unit of state government such as officers,
agencies, divisions, departments, boards, commissions, authorities, or public corporations. An employing unit is not in default if it
has entered into repayment agreements with the appropriate
divisions of the bureau and remains in compliance with its
obligations under the repayment agreements.
The rules shall provide that, before granting, issuing, or
renewing any contract, license, permit, certificate, or other
authority to conduct a trade, profession, or business to or with
any employing unit, the designated agencies shall review a list or
lists, provided by the appropriate divisions of the bureau, of
employers that are in default. If the employing unit's name is not
on the list, the agency, unless it has actual knowledge that the
employing unit is in default with a division of the bureau, may
grant, issue, or renew the contract, license, permit, certificate,
other authority to conduct a trade, profession, or business. The
list may be provided to the agency in the form of a computerized
database or databases that the agency can access. Any objections
to such refusal to issue or renew shall be reviewed under the
appropriate provisions of this chapter or of chapter twenty-three
of this code, or both, whichever is applicable. The rules provided
for by this subdivision shall be promulgated pursuant to the
provisions of subdivisions (b) and (c), section seven, article
three of this chapter as if they were rules being promulgated for
the purposes of chapter twenty-three of this code. The prohibition
against granting, issuing, or renewing any contract, license, permit, certificate, or other authority under this subdivision are
not operative until the rules are promulgated and are in effect,
except as provided in subdivision (6), section eight, article
three, chapter twenty-two or otherwise by law.
The rules may be promulgated or implemented in phases so that
specific agencies or specific types of contracts, licenses,
permits, certificates, or other authority to conduct trades,
professions, or businesses will be subject to the rules beginning
on different dates. The presumptions of ownership or control
contained in the division of environmental protection's surface
mining reclamation regulations promulgated under the provisions of
article three, chapter twenty-two of this code are not applicable
or controlling in determining the identity of employing units who
are in default for the purposes of this subdivision. The rules
shall also provide a procedure allowing any agency or interested
person, after being covered under the rules for at least one year,
to petition the council to be exempt from the provisions of the
rules. Rules subjecting all applicable agencies and contracts,
licenses, permits, certificates, or other authority to conduct
trades, professions, or businesses to the requirements of this
subdivision shall be promulgated no later than the first day of
January, two thousand; and
(19) Deposit to the credit of the appropriate special revenue
account or fund, notwithstanding any other provision of this code and to the extent allowed by federal law, all amounts of delinquent
payments or overpayments, interest and penalties thereon, and
attorneys' fees and costs collected under the provisions of this
chapter and chapter twenty-three of this code. The amounts
collected shall not be treated by the auditor or treasurer as part
of the general revenue of the state.
(20) Notwithstanding anything to the contrary, the office of
judges shall consider pleadings and protest documents as evidence
of the allegations therein contained.
(21) Notwithstanding anything in this code to the contrary, if
the commissioner has performed an audit of any kind on an
employer's accounts, including an internal audit, the commissioner
shall inform an employer in writing of the results of the audit not
later than thirty days following completion of the audit process.
An audit is conclusively presumed unreasonable if an employer is
not notified in writing of the audit within sixty days following
commencement of the audit. The commissioner shall also notify an
employer in writing at the commencement of any audit of that
employer's account. Any time the commissioner believes an employer
to be in default the commissioner has thirty days to notify the
employer in writing of the alleged default. Failure to notify an
employer in accordance with the terms of this subsection acts as an
absolute bar to the imposition and collection of interest and
penalties and to collection of attorney fees on the amount of the alleged default. For purposes of this section, the term "default"
includes any alleged amount of underpayment of quarterly premium
and the amount of underfunded premium deposit for any calendar
quarter or quarters preceding the calendar quarter in which notice
of the alleged default is issued.
NOTE: The purpose of this bill is to
require proposals from
attorneys to collect Workers' Compensation premiums to be on both
an hourly and a contingent fee basis. The bill places a limitation
on attorney fees and requires notification to employer of audit
commencement and results. The bill also sets forth a limitation on
commissioner where the procedure is not followed.
Strike-throughs indicate language that would be stricken from
the present law, and underlining indicates new language that would
be added.
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