Order: Late Settlement Sanction

Effective July 1, 2018

By order of the Commissioner, beginning July 1, 2018, the Iowa Division of Workers’ Compensation will impose a monetary late settlement sanction on parties in cases where settlements are reported to the Division less than 24 hours before the scheduled start time of the hearing.  Settlements must be reported to both the Division and the Deputy Commissioner assigned to hear the case 24 hours or more before the hearing is scheduled to start to avoid imposition of the sanction.  This sanction is modeled on the late settlement sanction which is imposed by the Iowa District Courts.  The Division has recently experienced an increase in late settlements which places further strains on diminishing resources.  This action is necessary to allow the Division to better serve the people of the State of Iowa.  The late settlement sanction order is effective for all cases with hearing dates of July 1, 2018, or later.

Claims that have been assessed a late settlement sanction will not have the settlement approved until the sanction has been paid.  The late settlement sanctions shall be paid to the Division of Workers’ Compensation and all funds received will be paid over to the Iowa General Fund.

The late settlement sanction will apply in cases filed using the Form 100.  It will also apply in full and partial commutation cases filed before July 1, 2017.  It is not applicable to alternate medical care, vocational benefits or compliance proceedings.

Beginning in June 2018, the late settlement sanction order will be provided to the parties in all contested cases with hearing dates of July 1, 2018, or later, and it will also be incorporated into the hearing assignment order in all new cases.  The order is found below:

ORDER

Late Settlement Sanction.  Effective July 1, 2018, parties are hereby ordered to report any settlement in any contested matter to the Division of Workers’ Compensation and to the Deputy Commissioner assigned to hear the case no less than 24 hours before the scheduled start time of the hearing.  If a settlement is not reported, or if the settlement is reported less than 24 hours before the scheduled start time of the hearing,​ or if the case is settled during the hearing, or after the hearing before a decision of a deputy commissioner is issued, the parties shall be sanctioned a total amount of $300.00.​  The sanction shall be assessed in equal proportionate shares against the claimant and the self-insured employer or the insurance carrier(s), unless the parties reach a different arrangement among themselves as part of the settlement for payment of the sanction.  See 876 IAC 4.36 and 4.40.  This sanction will not apply in any case where the Second Injury Fund of Iowa is the only defendant and it will not be assessed against the Second Injury Fund in any other case.  This sanction will not apply in alternate medical care proceedings.  If there is a showing of good cause, this sanction may be waived at the discretion of the hearing deputy.  The sanction monies shall be made payable to the Division of Workers’ Compensation and sent to the Division of Workers’ Compensation, 1000 E. Grand Ave., Des Moines, IA  50319-0209.  The sanction monies will be forwarded by the Division of Workers’ Compensation to the Treasurer of the State of Iowa to be deposited into the Iowa General Fund.