Late Settlement Sanction

  • May 30, 2018

Legislative Update by Attorney Kathryn Johnson

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.

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