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Can a Lien be placed on my Alabama Workers Comp Claim?

Can a Lien be placed on my Alabama Workers Comp Claim?

In a workers’ compensation claim in Alabama, generally liens against any recovery, judgment or settlement the injured worker receives is not allowed.  Numerous times my partner and I have received phone calls from a client asking questions about giving companies a lien against the value of their workers’ compensation claims so the company can loan them some money now, or the companies will fax a form to our office, requesting us to promise to honor a loan that they are willing to give our client-the injured worker.  While we understand how tempting it is to want to get a loan on the value of your case, especially since the ttd benefits injured workers’ draw is only 2/3rd of their average weekly wage while Alabama Power still expects 100% of their bill paid, but this is not allowed per our workers’ compensation statute.

Ala.Code §25-5-86(2) states that “[c]laims for compensation, awards, judgments, or agreements to pay compensation owned by an injured employee or his or her dependant shall not be assignable and shall be exempt from seizure or sale or garnishment for the payment of any debt or liability.”  In other words, a loan company or person cannot take a lien on your potential recovery of workers’ compensation benefits, meaning they cannot give an injured worker or the worker’s dependants a loan for the promise of payment later once the worker receives their compensation.

The purpose of the exemption of workers’ compensation benefits from any lien is to prevent the workers’ creditors from seizing or trying to garnish benefits owed the injured worker or their dependents; however, child support payments are not considered a debt or liability in this sense and a lien can be placed on your workers’ compensation benefits for an arrearage in child support payment.  Additionally, if you have a third-party liability claim related to your job injury, the workers’ compensation carrier could have a right to subrogate monies paid to you in the event of a recovery on the third-party case.  If you have questions as to whether a lien can be issued or claimed against your workers’ compensation benefits, an attorney experienced with Alabama’s workers’ compensation statute can help.

If you have suffered a job injury and you have questions about your right to Alabama workers’ compensation benefits, don’t hesitate to contact Powell and Denny and speak with one of the experienced workers compensation lawyers and schedule a free consultation and let us see if we can help.  Appointments are available in person, or virtually through Zoom for your convenience from wherever you live.

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Powell and Denny have been selected as one of the Best Law Firms by U.S. News and World Report for each of the last 9 years, have been selected as one of Birmingham’s Top Lawyers by B-Metro Magazine for the last 5 years, have been selected by The National Advocates as one of the Top 20 Workers’ Compensation Firms (plaintiffs) and Powell and Denny, P.C.-has been selected as one of the “Best of the Best” law firms by The American Registry and included in the list as one of the Mid-South’s Super Lawyers.

Mr. Denny is AV rated by Martindale Hubbard (the highest rating possible) and Mr. Powell has been rated as Superior by The National Registry

+ Powell and Denny have successfully represented injured workers from Birmingham, Huntsville, Florence, Muscle Shoals, Tuscumbia, Athens, Decatur, Town Creek Ardmore, Hartselle, Madison, Toney, Scottsboro, Ft. Payne, New Hope, Guntersville, Albertville, Boaz, Ashville, Anniston, Gadsden, Cullman, Jasper, Gardendale, Morris, Kimberly, Centerpoint, Leeds, Tarrant City, Fairfield, Hueytown, Bessemer, Adger, Tuscaloosa, Cordova, Alabaster, Pelham, Harpersville, Opelika, Phenix City, Montgomery, Clanton, Calera, Enterprise, Monroeville, Mobile, Evergreen, Dothan, Alabaster, Pelham, Trussville and towns and cities in between.



Can a Lien be placed on my Alabama Workers Comp Claim?

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