Workers' Compensation

ORS 656.307
Determination of issues regarding responsibility for compensation payment

  • mediation or arbitration procedure
  • rules


(a) Where there is an issue regarding:


Which of several subject employers is the true employer of a claimant worker;


Which of more than one insurer of a certain employer is responsible for payment of compensation to a worker;


Responsibility between two or more employers or their insurers involving payment of compensation for one or more accidental injuries; or


Joint employment by two or more employers,
the Director of the Department of Consumer and Business Services shall, by order, designate who shall pay the claim, if the employers and insurers admit that the claim is otherwise compensable. Payments shall begin in any event as provided in ORS 656.262 (Processing of claims and payment of compensation) (4).


At the time of claim closure, all parties to an order issued pursuant to paragraph (a) of this subsection shall have reconsideration and appeal rights.


The director then shall request the Workers’ Compensation Board chairperson to appoint an Administrative Law Judge to determine the responsible paying party. The proceedings shall be conducted in the same manner as any other hearing and any further appeal shall be conducted pursuant to ORS 656.295 (Board review of Administrative Law Judge orders) and 656.298 (Judicial review of board orders).


When a determination of the responsible paying party has been made, the director shall direct any necessary monetary adjustment between the parties involved. Any monetary adjustment not reimbursed by an insurer or self-insured employer shall be recovered from the Consumer and Business Services Fund. Any stipulation or agreement under subsection (6) of this section shall not obligate the Consumer and Business Services Fund for reimbursement without prior approval of the Director of the Department of Consumer and Business Services.


No self-insured employer or an insurer shall be joined in any proceeding under this section regarding its responsibility for any claim subject to ORS 656.273 (Aggravation for worsened conditions) unless the issue is entitled to hearing on application of the worker.


The claimant shall be joined in any proceeding under this section as a necessary party, but may elect to be treated as a nominal party. If the claimant appears at any such proceeding and actively and meaningfully participates through an attorney, the Administrative Law Judge may require that a reasonable fee for the claimant’s attorney be paid by the employer or insurer determined by the Administrative Law Judge to be the party responsible for paying the claim.


(a) Notwithstanding subsection (2) of this section, parties to a responsibility proceeding under this section may agree to resolution of the dispute by mediation or arbitration by a private party. Any settlement stipulation, arbitration decision or other resolution of matters in dispute resulting from mediation or arbitration proceedings shall be filed with the Hearings Division and shall be given the same force and effect as an order of an Administrative Law Judge made pursuant to subsection (2) of this section. However, any such settlement stipulation, arbitration decision or other resolution is binding on the parties and is not subject to review by the director, an Administrative Law Judge, the board or any court or other administrative body, unless required pursuant to paragraph (d) of this subsection or subsection (3) of this section.


For purposes of this subsection, mediation is a process of discussion and negotiation, with the mediator playing a central role in seeking a consensus among the parties. Such consensus may be reflected in a final mediation settlement stipulation, signed by all the parties and fully binding upon the parties with the same effect as a final order of an Administrative Law Judge, when the signed mediation settlement stipulation is filed with the Hearings Division of the Workers’ Compensation Board.


For purposes of this subsection, arbitration is an agreement to submit the matter to a binding decision by an arbitrator, through a process mutually agreed upon in advance. Once all the parties have agreed in writing to proceed with arbitration, no party may withdraw from the arbitration process except as provided in the written arbitration agreement.


A mediation settlement stipulation may include matters beyond the responsibility issues. If other matters are included, the settlement agreement shall be submitted to the Hearings Division of the Workers’ Compensation Board for review and approval, under this chapter, as to such additional matters beyond the responsibility issues.


Any arbitration decision shall be limited to a decision as to responsibility and, where appropriate, the payment of associated costs and attorney fees. The arbitrator’s decision shall have the same effect as a final order of an Administrative Law Judge when the signed decision is filed with the Hearings Division.


When the parties have reported to the Hearings Division that they have agreed upon a mediation or arbitration process, the hearing shall be deferred for 90 days to allow the mediation or arbitration process to occur. Once 90 days have passed, the matter shall again be docketed for hearing unless the parties advise the Hearings Division in writing that progress has been made and request an extension of time of up to 90 days, which extension of time shall be granted as a matter of right. Once the second 90 days have passed, the matter shall again be docketed for hearing, and the hearing shall proceed before an Administrative Law Judge as though there had been no mediation or arbitration process, unless the parties present a mediation settlement stipulation or signed arbitration decision before the hearing begins.


All parties must agree in writing to pursue mediation or arbitration and must agree upon the selection of the mediator or arbitrator. The mediator or arbitrator shall not be an employee of any insurer or self-insured employer that is a party to the proceedings. The mediator or arbitrator must be an attorney admitted to practice law in the State of Oregon. The mediator or arbitrator may serve as a mediator or arbitrator, even if the mediator or arbitrator separately represents any insurer or self-insured employer in other proceedings, provided that all parties are advised of such representation and consent in writing that the mediator or arbitrator may so serve despite such other representation. Such written consent supersedes any legal ethics restrictions otherwise provided for in law or regulation.


If the claimant is represented by an attorney, the other parties must arrange for payment of a reasonable attorney fee for the claimant’s attorney’s services during the mediation or arbitration. Any mediation or arbitration agreement shall specify the terms of the fee arrangement.


If the claimant is not represented by an attorney, the mediation process cannot include any issue other than responsibility. A nonrepresented claimant must be advised in writing of the following before the mediation or arbitration proceeds:


The claimant’s right to refuse to participate in mediation or arbitration proceedings and to, instead, proceed to a hearing before an Administrative Law Judge;


The present rate of temporary total disability benefits for each alleged date of injury;


The present rate of permanent partial disability benefits for each alleged date of injury;


The estimated date of expiration of aggravation rights for each alleged date of injury; and


The claimant’s right to be represented by counsel of the claimant’s choice at no expense to the claimant.


Notwithstanding any other provision of law, any insurer or self-insured employer may be represented by a certified claims examiner rather than by an attorney in any mediation or arbitration hereunder. Any separate insured for the same insurer shall be represented by a separate claims examiner, if the insured has a continuing financial exposure as to the claim; where no continuing financial exposure exists, a single certified claims examiner may represent more than one insured for the same insurer in the mediation or arbitration proceeding.


Any other procedures as to mediation or arbitration shall be subject to agreement among the parties. The Workers’ Compensation Board may adopt rules as to the process for deferral and docketing of hearings where mediation or arbitration occurs, the filing of arbitration decisions as orders of the Hearings Division, the filing of mediation settlement stipulations regarding responsibility as orders of the Hearings Division, and review and approval of mediation settlement stipulations that extend beyond the issues of responsibility and associated attorney fees and costs. The Workers’ Compensation Board shall not enact rules that restrict the mediation or arbitration process except to the extent provided within this section. [1965 c.285 §39; 1971 c.70 §1; 1979 c.839 §8; 1987 c.713 §5; 1995 c.332 §36; 1997 c.43 §1; 1999 c.313 §9; 1999 c.876 §3; 2003 c.657 §§9,10; 2007 c.274 §5]

Notes of Decisions

Where more than one injury is capable of causing temporary total disability, proration of benefits between responsible parties is appropriate. Jackson v. SAIF, 7 Or App 109, 490 P2d 507 (1971)

Where claimant failed to timely appeal from denial of aggravation claim by current insurer, insurer covering initial injury was not entitled to reimbursement from current insurer because initial-injury insurer's claim for reimbursement was derivative of claimant right. Saltmarsh v. A. T. Industries, Inc., 35 Or App 763, 583 P2d 4 (1978), Sup Ct review denied

Where issue is allocation of responsibility among insurers rather than compensability of claim, claimant need not appeal nonresponsibility finding in favor of particular insurer to protect claim right in event of later reallocation. Hanna v. McGrew Bros. Sawmill, 44 Or App 189, 605 P2d 724 (1980), modified45 Or App 757, 609 P2d 422 (1980)

Settlement entered into under ORS 656.289 by one insurer and claimant on issue of responsibility after issuance of order was invalid where there was dispute as to which insurer was responsible for claimant's injury or condition. J.C. Compton Co. v. DeGraff, 52 Or App 317, 628 P2d 437 (1981), Sup Ct review denied, as modified by 52 Or App 1023, 630 P2d 895 (1981)

Penalties or attorney fees are not available where insurer unreasonably delays request to designate paying agent. EBI Companies v. Thomas, 66 Or App 105, 672 P2d 1241 (1983)

Where one party accepts claim after denial by another party, requirement of determination of responsible paying party is satisfied and department has authority to order payment of reimbursement for interim compensation. Liberty Northwest Ins. Corp. v. SAIF, 99 Or App 729, 784 P2d 123 (1989)

Notified insurer that knows of potential dispute over responsibility for claim has obligation to join other potentially responsible insurers and may not avoid responsibility by failing to join other insurers. Dennis Uniform Manufacturing v. Teresi, 115 Or App 248, 837 P2d 984 (1992), modified 119 Or App 447, 851 P2d 620 (1993)

Insurer acquiescence to designation of paying agent does not constitute acceptance of claim. Taylor v. Masonry Builders, Inc., 127 Or App 230, 872 P2d 442 (1994), Sup Ct review denied

Attorney fee limitation under ORS 656.308 does not apply in determining reasonable attorney fee for claimant's attorney under this section. Dean Warren Plumbing v. Brenner, 150 Or App 422, 946 P2d 356 (1997)

Administrative system for assigning claim payment responsibility does not divest circuit court of jurisdiction over unjust enrichment action arising out of payment on mistakenly accepted claim. Specialty Risk Services v. Royal Indemnity Co., 213 Or App 620, 164 P3d 300 (2007)

Law Review Citations

23 WLR 441, 457 (1987); 24 WLR 363 (1988); 32 WLR 217 (1996)

§§ 656.001 to 656.794

Law Review Citations

55 OLR 432-445 (1976); 16 WLR 519 (1979); 22 WLR 559 (1986)

Chapter 656

Notes of Decisions

Party having affirmative of any issue must prove it by preponderance of evidence unless legislature fixes some different quantum of proof. Hutcheson v. Weyerhaeuser Co., 288 Or 51, 602 P2d 268 (1979)

Amendments to existing statutes and enactment of additional statutes by 1995 legislation generally apply to pending cases and to orders still appealable on June 7, 1995, effective date. Volk v. America West Airlines, 135 Or App 565, 899 P2d 746 (1995), Sup Ct review denied

Amendments to existing statutes and enactment of additional statutes by 1995 legislation do not extend or shorten procedural time limitations with regard to actions taken prior to June 7, 1995, effective date. Motel 6 v. McMasters, 135 Or App 583, 899 P2d 1212 (1995)

Atty. Gen. Opinions

Benefit unavailability for inmates engaged in prison work programs, (1996) Vol 48, p 134

Law Review Citations

24 WLR 321, 341 (1988); 32 WLR 217 (1996)


Last accessed
Jun. 26, 2021