Four Things Employers Should Remember About Settling Workers Compensation Claims

When to settle a work comp claim – the rules… New York Attorney Theodore Ronca offers some pros and cons of settling workers comp cases, and some parameters and thoughts on the process. Settlement of any legal action is favored by the courts and the states, but when and why should it be done? 1. Settlement before all pertinent facts are known is dangerous and sets terrible precedents. Settlement without knowledge invites fraud and exaggeration of claims. It is quickly communicated to co-workers and creates a dysfunctional work environment. Therefore, never settle without as much knowledge of the facts and circumstances as can reasonably be obtained. 2. Why settle? Active litigation of a claim is expensive, drives up work comp costs and is demoralizing for all parties. It can forever destroy a worker's employability. At some point, even the prospect of a successful defense can become counter-productive. All sides, when it comes to medical matters and measurements of disability, must admit to a considerable range of uncertainty. As long as no fraud is involved and both sides compromise, there is little harm in disposing of a dispute. 3. When not to settle. Never settle when a claim is fraudulent. Never "split with zero". (If you're expert says there is no disability or permanent loss it is better to take the litigation to its conclusion than to settle, even if you do not prevail.) Never take advantage of a settlement offer which is detrimental to an honest worker's future. Dire circumstances can cause a worker to accept an offer when they are depressed or panicked. Co-workers will, always, learn of it and the damage is considerable and permanent. Never settle with strangers. You must get to know the people with whom you are dealing. Workers compensation is highly repetitious and involves relatively few people. It will not be difficult to find people who know the reputations of those other people at the conference table. 4. Life after settlement. A good worker is fearful and depressed at the thought of severing a relationship built up over years or decades. If they will not be returning to your employment allow them to remain part of your social community. In time, they will transition to a different pattern of life, often far away. Let the transition be as pleasant as circumstances permit. Settlement of a serious injury pushes executive skills to the limit. Leadership, communication and charity are essential. Your workers are watching. Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers' compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100. Try the WC Cost Calculator to show the REAL COST of work comp. Look at WC 101 for the basics about workers comp. Do not use this information without independent verification. All state laws are different. Consult with your corporate legal counsel before implementing any cost containment programs. ©2008 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact I[email protected]