Oregon Department of Consumer and Business Services, Workers' Compensation Division

Rule Rule 436-060-0155
Penalty to Worker for Untimely Processing


(1) General. If the insurer unreasonably delays or unreasonably refuses to pay compensation, attorney fees or costs, or unreasonably delays acceptance or denial of a claim:
(a) The director may require the insurer to pay:
(A) A penalty, payable to the worker, of up to 25 percent of the amounts then due, determined by the matrix attached to these rules in Appendix “B.” When there are no “amounts then due” upon which to assess a penalty, no penalty will be issued under this rule; and
(B) A fee to the worker’s attorney under ORS 656.262 (Processing of claims and payment of compensation)(11) and OAR 436-001-0420 (Attorney Fees Awarded under ORS 656.262(11)).
(b) For the purpose of this rule, and the matrix attached to these rules in Appendix “B,” a “violation” is:
(A) The late payment or the nonpayment of any single payment due;
(B) A continuous underpayment, such as with yearly cost of living increases for temporary disability compensation. In the case of a continuous underpayment, all prior underpayments will be considered as one violation, regardless of when the first underpayment occurred; or
(C) The late issuance of an acceptance or denial notice under OAR 436-060-0140 (Acceptance or Denial of a Claim)(2).
(2) Requests for penalties and attorney fees. Requests for penalties and attorney fees under this rule must:
(a) Be made in writing;
(b) State, in the request, what benefits have been delayed or remain unpaid; and
(c) Be mailed or delivered to the division within 180 days of the date of the alleged violation. For the purpose of this rule, the date of the alleged violation is:
(A) For the late payment or nonpayment of any single payments, the date payment was due;
(B) For a continuous underpayment, the date of the last underpayment; or
(C) For a late issuance of an acceptance or denial notice, the date the notice was due under OAR 436-060-0140 (Acceptance or Denial of a Claim)(2).
(3) Required response from the insurer. When notified by the director that additional amounts may be due to the worker as a penalty under this rule:
(a) The insurer must respond in writing to the division:
(A) The response must include a reason for the delay, and any additional information or documentation requested by the director;
(B) The response must be mailed or delivered to the division within 14 days of the mailing date of the director’s inquiry letter; and
(C) Copies of the response, including any attachments, must be simultaneously sent to the worker and the worker’s attorney, if any;
(b) If the insurer fails to meet the requirements of this section, the director may assess a civil penalty under OAR 436-060-0200 (Assessment of Civil Penalties).
(4) Jurisdiction over proceedings. The director has exclusive jurisdiction when the assessment and payment of penalties and attorney fees described in ORS 656.262 (Processing of claims and payment of compensation)(11) are the only issues of the proceedings between the parties. The director will not issue an order assessing a penalty or attorney fee under this rule when the same parties have initiated proceedings before the board.
(a) If the director receives a request for penalties and attorney fees under this rule, and is aware of proceedings between the parties before the board, the director will refer the request to the board.
(b) If the director has not been made aware of the proceeding before the board and issues a penalty order that becomes final, the director’s penalty will stand.
(5) Timely payment of penalties. Penalties ordered under this rule must be paid to the worker no later than the 30th day after the date of the order, unless the order is appealed. If the order is appealed and later upheld, the penalty will be due within 14 days of the date the order upholding the penalty becomes final. If the insurer does not pay penalties in a timely manner the insurer will be subject to civil penalties under OAR 436-060-0200 (Assessment of Civil Penalties).
(6) Dispute resolution. Disputes regarding unreasonable delay or unreasonable refusal to pay compensation, attorney fees or costs, or unreasonable delay in acceptance or denial of a claim may be resolved by the parties.
(a) In cases where the director has exclusive jurisdiction under section (4) of this rule, and the violations occurred within the last 180 days as described in subsection (2)(c) of this rule, then the parties must submit a stipulation to the division for approval. The stipulation must specify:
(A) The benefits, attorney fees, or costs delayed and the amounts;
(B) The time periods involved;
(C) If applicable, the name of the medical providers and the dates of services relating to medical bills;
(D) The amount of the penalty not to exceed 25 percent of the amounts then due under ORS 656.262 (Processing of claims and payment of compensation)(11)(a); and
(E) The attorney fees, if applicable.
(b) Any other agreements between the parties to pay a penalty or attorney fee must have a stipulation approved by the director to be acknowledged as a violation as it applies to the matrix in Appendix “B” of these rules. [See attached table.]
(c) Payment of a penalty due under this section is due within 14 days after the date the director approves the stipulation, unless otherwise stated in the stipulation. If the insurer does not pay penalties in a timely manner the insurer will be subject to civil penalties under OAR 436-060-0200 (Assessment of Civil Penalties).
[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]
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Last accessed
Jun. 8, 2021