In this video, we’re going to address the question we receive a lot, and that is whether or not workers’ compensation will offer a settlement of their claim. My name is Matt Eason. I’ve been practicing workers’ compensation and personal injury law for over 25 years. We’re regularly asked a variation of whether or not workers’ compensation will offer a settlement of the claim.
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Workers’ compensation cases are typically settled, or I should say, resolved two different ways. One is by virtue of what is known as a stipulation and award, and the other is by virtue of a compromise and release.
A stipulation and award in a workers’ compensation case isn’t really a settlement. It’s rather an agreement—a stipulation as to what judge would award if you were to go to trial. So the parties may enter into settlement negotiations for a stipulation as to what the judge would award, and then the judge issues that award. While it’s not technically a settlement of your claim is rather an agreement as to what your claim value is and payment pursuant to the value of the claim.
Suppose the case isn’t resolved by way of a stipulation award. In that case, it’s usually voluntarily resolved by way of a settlement agreement, more commonly known in the workers’ compensation arena as a compromise and release. A compromise and release agreement takes all of your potential claims, past, and future, wraps them into one specific settlement, and them wipes the slate clean for everybody. That’s what’s traditionally referred to as a settlement, opposed to a stipulation and award.
Now we have a bit of a backdrop between the two different ways that cases voluntarily settle in the workers’ compensation arena. Statistically speaking, most cases resolve by way of a stipulation and award, and there never is a compromise and release.
In situations in which you continue to be employed by the same employer, it’s actually quite rare that your case will resolve with a compromise and release. The way the workers’ compensation system is set up to reopen claims or to file a new claim does not lend itself very well to a compromise and release if you remain employed by the same employer. The purposes of a compromise and release are they will wipe their hands of any future liability. But if you’re still working there, that never really happens. There’s always the risk of future liability.
In contrast, if you’ve left your employer and no longer work for that same employer, or in some cases, you may be with the employer. If they have changed workers’ compensation insurance carriers, you may actually find yourself in a situation where you can settle your case for compromise and release. Those cases lend themselves more to compromise and release because the carrier who is funding that wants to rid themself of the claim, and they can effectively do so because you no longer work for an employer they insure.
So to answer the question of whether or not you’re likely to receive a settlement offer in your workers’ compensation case really depends on how you define a settlement offer. Suppose you’re defining it in the limited sense of a compromise and release where everybody wipes their hands of it. Then it’s really going to depend on whether or not you are still working for an employer that is insured by the same insurance company. In contrast, if you’re defining a settlement agreement to include a settlement of the claims by virtue of a stipulation and award. Well, then yes. Statistically, it is overwhelming that you’ll receive a settlement offer in your workers’ compensation case for some amount.
If you’ve been presented with a “settlement offer” or compromising and release or a proposed stipulation and award and you got questions about whether you should accept that or not, I hope you consider reaching out to one of our workers compensation lawyers in Sacramento here at Eason & Tambornini.
