By Jane Salem, staff attorney, Nashville

IMPORTANT. Governor Bill Lee recently signed a bill into law revising the standards by which a workers’ compensation judge may/must award attorney’s fees and costs. The new law will certainly be one to watch for both employee and employer attorneys in Tennessee. PLEASE READ IT. These changes apply to injuries that happen on or after July 1, 2026.

Below is the summary of a humble staff attorney, along with a few of my own opinions—not the Court’s.

Traditionally, and under the current law, plaintiff lawyers typically receive 20% of the employee’s award. Stated another way, they’re paid by their client from the amount they recover. No worries; no changes here.

In addition to that amount, the current law allows for fee-shifting—the employer paying some fees—under limited circumstances.

Specifically, under subsection 50-6-226(d)(1), along with the 20% mentioned above, a trial court currently may award fees and costs when an employer:

A) Fails to furnish medical benefits to an employee under “a settlement, expedited hearing order, compensation hearing order, or judgment[,]” or, B) “Unreasonably denies a claim or unreasonably fails to timely initiate any of the benefits to which the employee… is entitled . . . if the workers’ compensation judge makes a finding that the benefits were owed at an expedited hearing or a compensation hearing.”

Notice that A) above is black and white; fees may be awarded when an employer doesn’t timely provide benefits under a settlement or court order. The judge doesn’t determine if that failure was “unreasonable.” Rather, the analysis of whether the employer acted “unreasonably” only takes place under B), when a judge makes that finding after an expedited or compensation hearing. McCool v. Prof. Care Servs.

As well-seasoned practitioners know, the Appeals Board discouraged fee awards after an expedited hearing, “given the twists and turns inherent in litigation.” Andrews v. Yates Servs.

However, the new statute will explicitly codify that fees may or must be awarded at the interlocutory or expedited hearing stage depending on the circumstances. It reads:

“When, at an expedited hearing, the workers’ compensation judge concludes . . . that the employer unreasonably denied the claim or unreasonably failed to timely initiate benefits, the court may award attorneys’ fees and costs at that time. If, in addition, the workers’ compensation judge finds that the evidence of such unreasonableness is clear and convincing, then any award of attorneys’ fees and costs . . . must not be deferred to a compensation hearing. The interlocutory nature of an expedited hearing order does not, standing alone, serve as a basis to deny or defer an award of attorneys’ fees and costs[.]” (Emphasis added).

What will constitute “clear and convincing evidence” of unreasonable conduct by an employer, that will require a judge to award fees at the expedited hearing stage? “Clear and convincing” is not a new phrase or a low bar, but only time will tell us what it means in this context.

As previously mentioned, the new statute limits its application to “injuries that occur between July 1, 2026, and June 30, 2030.” The statute takes effect on July 1, 2026. That means it will be a while before cases with a date of injury falling within that range come before the trial and appellate courts. Will lawmakers let it sunset in 2030? Again, time.

The bill was signed on April 27, and its legislative history is available here. It passed unanimously in both chambers. So, while practitioners might have strong feelings about this provision, it wasn’t a difficult choice for lawmakers. Further, the plaintiff lawyer in McCool argued for fees citing “public policy,” which the Board didn’t accept. But were lawmakers listening?

I’ll end by throwing down the gauntlet, so to speak. British jurist and philosopher Jeremy Bentham said, “The power of the lawyer is in the uncertainty of the law.” I can’t wait to see how you, the practitioners, interpret this law. It’s what makes all of our jobs challenging and meaningful.

No other state can match Tennessee’s beautiful spring weather. But I might be biased.