What Is a Compromise & Release Settlement for Workers’ Compensation?

What Is a Compromise & Release Settlement for Workers' Compensation? You likely qualify for workers’ compensation benefits when you suffer a workplace injury. Sometimes, you may encounter a compromise and release agreement. These agreements have many intricacies to them. You should understand what they are before you agree and sign. Once you sign these agreements, you may lose your right to additional legal options.

Ideally, your Harrisburg workers’ compensation attorney guides you through what this means for your case and if you should accept it. KBG Injury Law has experience handling workers’ compensation claims and explaining the C&R agreements.

The basics of compromise and release agreements

A compromise and release agreement (C&R) is a process the insurance company will use to settle your claim. The critical factors in these agreements include:

  • Payment for medical expenses
  • Payment for lost wages
  • Direct payment to medical facilities
  • You have the option to receive a lump sum or installment payments
  • If there is a permanent injury, you have the option to obtain past and future wage losses

The employer is released from any further responsibility for your injuries by providing you with this payment. You get your payment, they close the claim, and that is the end. Several provisions can be involved in these agreements. You must weigh out the pros and cons of the compromise and release agreement.

Possible provisions in a C&R settlement

Some provisions can be outlined in your compromise and release agreement for workers’ compensation. While the premise is to provide you with a payment so you do not pursue additional compensation, there are issues to address. Depending on your circumstances, the following may apply to your claim.

Lump sum or structured payments

If you receive a lump sum payment, you get one big check. Most settlements result in a lump sum payment and are issued within 30 days of court approval. Structured settlements are payments made to the injured party over time. They can be made on a monthly or annual basis. Some structured settlements are made every few years.

Partial settlement

Another provision is a partial settlement. This involves settling part of your claim, such as lost wages. The insurance company will issue the settlement for lost wages without providing additional benefits. You can include other stipulations so you can get payment for medical expenses and other losses as you incur them.

Additional documents

Aside from your agreements, you could be asked to sign other documents. This might include a document stating you will not discuss the case with other individuals or the media. Often, you must sign documentation regarding child support payments and other arrears. You may be asked to sign a resignation from employment. These additional documents provide other legal hurdles. You should discuss the best action with your Harrisburg workers’ compensation attorney.

Special hurdles in Pennsylvania

These agreements are state-specific. They are not available nationwide. In Pennsylvania, Chapter 131 outlines how compromise and release agreements work. It also addresses the provisions that may be included. There are two main issues discussed within the chapter. First, the C&R must be approved by a judge. When the agreement is ready, a hearing will be held and the settlement must be approved by a judge. The judge’s only role is to ensure that the injured worker understands the legal significance of the agreement.

Risks and benefits for the injured worker

Before you decide to accept a C&R agreement, you should weigh the risks and benefits. The most significant benefit for injured workers is avoiding litigation. These legal processes can be time-consuming and expensive. Another benefit is choosing which medical providers you can see and being more involved in the decision-making process.

The risk with accepting a C&R is taking a lower offer for your claim. You may not be able to pay for future medical care and expenses. If you have a permanent injury or another serious condition, this might not be your best decision. A worker’s compensation attorney in Harrisburg will review your medical documents and the risks and benefits of accepting a C&R.

Whether or not you should accept a C&R has no standard answer since it will depend on individual factors. While they could be beneficial for some individuals, they could be detrimental for others. KBG Injury Law can assess the strengths of accepting this offer instead of going through a different legal route. Our team is local, and we understand how challenging it is for claimants to understand and make the right legal decisions. We are here to guide you. If you’re in the South Central Pennsylvania area, schedule a free initial consultation with our Harrisburg workers’ compensation attorneys today. Call our office in Harrisburg or complete our contact form.