After an accident happens on the job, the injured employee may not be sure where to even start when it comes to getting compensation for his or her injuries. Most employees are aware that they have workers’ compensation benefits available to them through their employer, but not many realize exactly what that means and how to access them when they need to file a claim. Is court required, or can a settlement be reached? How does one go about settling a workers’ compensation claim?
We have asked attorney Alaina Sullivan, about what you should do. Here is what she had to say:
What Is a Settlement?
A settlement is an agreement made out-of-court between two parties in a legal proceeding. Essentially the parties come to an agreement in lieu of litigation. When it comes to a workers’ compensation case, this settlement agreement is called a “Section 32 agreement.” A “Section 32 agreement” is when the injured employee agrees to close the workers’ compensation case and release the employer from responsibility to pay weekly benefits and medical expenses in exchange for a lump sum payment.
Because the employee is waiving his or her right to future payments, it is important that he or she understands what the agreement contains and what it does not. It is for this reason that a workers’ compensation attorney can help him or her through the process.
How Does the Workers’ Compensation Process Work?
After a claim has been submitted, the employee’s workers’ compensation attorney will help prepare a Settlement Demand to be sent to the insurance company. In this demand will be all of the different liabilities held by the insurance company.
The attorney will outline the injury, its severity, the employee’s wages prior to the injury and the effect the injury has had on his or her ability to perform his or her job. All of these points are considered components of exposure to the insurance company.
More often than not the insurance company will come back with a counter-offer unless they agree with all demands made by the employee. The negotiation process follows, which can occur informally or through a settlement conference or mediation. If the parties are not able to come to an agreement, the attorney and employee must decide if they wish to take the matter to hearing.
What Happens if No Settlement Is Reached?
If the parties are not able to come to an agreement, they can proceed to a hearing before a workers’ compensation administrative judge. At the hearing, the judge will determine what the employee is owed as of the date of the hearing and can order ongoing weekly payments unless something happens that causes benefits to terminate. He or she will not award the employee a lump sum payment. That type of award can only happen through settlement.
What Happens Once Settlement Occurs?
After a settlement is reached, the attorney will draft the settlement paperwork, otherwise known as a “Stipulation for Settlement.” This document contains all of the settlement terms, including how and when payment occurs. Anyone with an interest in the case, including medical providers and private insurance, will need to sign off on the document.
It is then sent to the Office of Administrative Hearings where the judge will review and either approve the document or deny it. The judge will look to make sure the award is fair to all concerned. If the judge approves and issues the award, the employer or insurance company has 14 days to issue the check.
What Are Some Settlement Options?
Two types of settlements exist in workers’ compensation cases: to-date and full, final and complete settlements. A to-date settlement means that the employee is only settling on an amount “to the date of” the award on the settlement. He or she has the right to bring future claims later, unless the terms of the settlement limit this ability.
A full, final and complete settlement is normally used when the employee has a denied claim or a claim that involves many disputed issues or if the employee cannot work for the date-of-injury employer in the future.
Further, in settlement, the employee will need to decide whether medical is going to be left open or closed out. Medical open means that the person can still pursue future claims for medical treatment against the insurer. It does not guarantee that all future claims will be paid forever. It simply leaves that right and option open.
Medical closed means that the sum of money received at settlement is considered payment for any future medical treatment. The employee waives the right to future claims by accepting that sum of money. The only other option on deciding whether to do medical open or closed is to see if the employee is Medicare eligible or a recipient. Choosing medical “closed” can complicated things if the employee is receiving Medicare.
Contact an Attorney Today
If you were injured during a workplace accident and do not know how to proceed with a workers' compensation claim, consulting with an attorney can help ease the uncertainty and answer any questions. An attorney trained in workers' compensation law can review your case and assist with filing a claim. Contact an attorney today to see what compensation you may deserve.