Workers’ comp fees cash cow for lawyer-lawmakers

April 11, 2018

Investigative Reports

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By RICK BRUNDRETT

A total of nearly $4 million in legal fees from workers’ compensation cases was paid out in 2017 to 21 lawyer-legislators or their law firms, records show – fees typically approved by commissioners who are screened and confirmed by state senators.

The two lawmakers reporting the highest workers’ comp earnings last year were Sen. Luke Rankin, R-Horry, who chairs the Senate Judiciary Committee responsible for screening candidates for the Workers’ Compensation Commission; and Rep. Tommy Pope, R-York and the House speaker pro tempore.

Rankin reported $540,948 – 41 percent of the total $1.3 million in fees listed on income-disclosure forms by 10 attorney-senators. Pope reported $969,237 – more than a third of the $2.6 million collectively listed by an 11-member group of House lawyer-lawmakers, The Nerve’s review found.

Pope told The Nerve that the nearly $1 million in legal fees listed on his income-disclosure form, filed March 29 with the State Ethics Commission, were earned by other lawyers in his law firm. He did not list any details about the identities or number of clients on his disclosure form.

“As far as actual hearings, we’ve got three guys who do workers’ comp,” Pope said, adding, though, he shares in the firm’s profits as a partner.

Rankin did not immediately respond to a message Tuesday from The Nerve seeking comment.

At least five other lawyer-lawmakers who listed workers’ compensation fees earned in 2017 have sponsored workers’ compensation legislation this year or last, records show.

While no one is accusing those lawmakers of wrongdoing, critics have long argued that attorneys in the Legislature have an inherent advantage when they appear before judges whom they elect, as well as boards and commissions, including the seven-member Workers’ Compensation Commission.

Commissioners are appointed to six-year terms by the governor, with consent of the Senate. The governor, with consent of the Senate, also selects one of the commissioners to serve as chairman for a two-year term. The Legislature sets the agency’s annual budget, which this fiscal year totals $7.1 million.

Under state law, the annual salary for workers’ compensation commissioners is 85 percent of a circuit court judge’s yearly salary. The commission chairman currently receives $125,208 annually, while the other six commissioners make $120,153, according to the state salary database.

Workers’ compensation insurance carried by employers is intended to cover qualified medical expenses and a percentage of wages for workers hurt on the job. Individual members of the Workers’ Compensation Commission can conduct hearings at the request of injured employees if, for example, employers deny that a claimed injury occurred during work hours, or if injured workers don’t believe they received all of the available wage or medical benefits.

Commissioners approve legal fees for attorneys representing injured workers, subject to state law and regulations.

On the last line of his income-disclosure form, called a statement of economic interests (SEI), filed March 30 with the State Ethics Commission, Rankin reported $540,948 in legal fees last year for representing “multiple clients” before the commission, though he didn’t identify or specify the number of clients. He listed three limited liability companies as private-income sources in 2017, as required by a change in state ethics law that took effect last year.

The other total legal fee amounts for 2017 in the 10-member, attorney-senator group ranged from $49 reported by Sen. Marlon Kimpson, D-Charleston, to $183,302 reported by Sen. Tom Young, R-Aiken, records show.

As with Rankin, Kimpson and Young serve on the Senate Judiciary Committee, which in February recommended to the full Senate three Workers’ Compensation Commission incumbents for reappointment.

On the Senate floor on March 1, Rankin made a motion to vote on reappointing the candidates – current commission chairman Thomas Beck, Mike Campbell and Gene McCaskill – all of whom were easily re-confirmed. Rankin and the nine other lawyer-senators who reported legal fees on their SEIs either abstained from voting or were not present for the votes, Senate records show.

The Nerve in 2013 reported that Rankin, a longtime Senate Judiciary Committee member who’s been in the Senate since 1993, received a total of more than $2.8 million in workers’ compensation fees from 2007 through 2012 – an annual average then of more than $478,000; and that since 2007 he had co-sponsored at least nine workers’ compensation bills.

In the current two-year legislative cycle, Young and two other attorney-senators who reported worker’s compensation fees earned in 2017 – Gerald Malloy, D-Darlington, and a Senate Judiciary Committee member; and Vincent Sheheen, D-Kershaw and a member of the budget-writing Senate Finance Committee – each sponsored workers’ compensation legislation. Young and Sheheen specified on their SEIs that the legal fees were paid to their respective law firms.

On the House side, Reps. Murrell Smith, R-Sumter and a member of the budget-writing Ways and Means Committee, and Greg Delleney, R-Chester and the House Judiciary Committee chairman, each sponsored workers’ compensation bills in the current legislative cycle. Each also reported receiving workers’ compensation fees last year: Smith, $9,969; and Delleney, $221,183 for representing 29 “Jane & John Doe” cases, according to their SEIs.

Besides Rep. Pope, 10 other House lawyer-lawmakers listed fees earned in 2017, their amounts ranging from $7,468 reported by Rep. Neal Collins, R-Pickens, to $530,000 reported by Rep. Beth Bernstein, D-Richland, whose income-disclosure form noted an unspecified number of “Jane/John Doe” clients.

All of the legislators in that group did not vote on the Workers’ Compensation Commission section of the proposed state budget for next fiscal year, which starts July 1, House records show.

House Speaker Jay Lucas, R-Darlington, reported $80,448 in workers’ compensation fees last year, noting on his SEI that the payments were “aggregate fees collected by” a law firm partner, though he gave no other specifics.

In contrast, Rep. John McCravy, R-Greenwood, who was elected to the House in 2016, gave a detailed fee explanation on his SEI, pointing out, among other things, that the total $508,831 in fees earned in 2017 were paid to the “entire law firm … not just the filer, and constitutes all WC (workers’ compensation) fees collected for the entire year.”

And, he also contended, the “large majority of fees were paid by out of state insurance companies, thereby improving the economy of our state.”

Brundrett is the news editor of The Nerve. Contact him at 803-254-4411 or rick@thenerve.org. Follow him on Twitter @RickBrundrett. Follow The Nerve on Facebook and Twitter @thenervesc.

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