The carrier holds a lien on the employee's third-party recovery for benefits paid, and may in some states bring the action directly. Attorney fee reduction and future credit provisions vary substantially.
Employer fault may reduce the lien.
Alternative Names:
Comp Lien|Workers' Compensation Subrogation
Why it Matters?
Employer negligence reduces or eliminates the lien in several states, since permitting full recovery would let a negligent employer benefit from its own fault, and that reduction is the employee's primary argument against the lien. Future credit against continuing benefits is separately significant, because a carrier that recovers its lien may also suspend future payments until the net recovery is exhausted. Coordinating the third-party case with the comp claim affects both.
Frequently Confused with
Related terms
Frequently asked questions
Does employer fault affect the lien?
What is future credit?
