If I Get A Lump Sum Settlement From Workers’ Comp Can I Return to Work?

Receiving a lump sum settlement from workers’ compensation can bring relief to an injured employee, but it often raises questions about the possibility of returning to work. 

Returning to Work After a Lump Sum Settlement

The possibility of returning to work after receiving a lump sum workers’ compensation settlement often hinges on the insurer’s policies and your settlement terms. Some workers’ comp insurance providers may only propose such a settlement if you decide to resign.

Their rationale is that if they allow you to return to work for the same employer, there is a risk of potential additional costs for another workplace injury already covered by the settlement. In cases where you wish to resume work, you typically have to accept a stipulated award. 

Why Insurers Typically Will Not Offer a Lump Sum Settlement if You Wish to Return to Work

The lump-sum settlement agreement is designed to provide compensation for your future medical expenses related to the injury. Once the agreement is finalized and signed, the insurance company is released from any further legal liability for the injury. The settlement amount paid absolves the insurer from covering future medical care needs for that specific injury.

However, insurers are typically concerned that if you return to work with the same employer and you were to exacerbate your pre-existing injury, there’s the possibility of another workers’ compensation claim. In that scenario, your employer’s workers’ comp insurance company would have to pay for a work-related injury that was previously paid for in your lump sum settlement. To avoid this complication, insurance companies often insist that a lump sum settlement also requires resignation. 

How Much Will My Lump Sum Settlement from Workers’ Comp Be?

In Pennsylvania, the determination of a lump sum workers’ compensation settlement agreement involves various factors, and the process is typically subject to negotiation between the injured worker, the employer (or its insurance carrier), and legal representatives. Here are key considerations:

Nature and Extent of Injuries

The severity and extent of the injuries sustained by the worker play a significant role in determining the settlement amount. More severe injuries or disabilities may lead to higher settlements. The cost of past and anticipated future medical treatments is a crucial factor. The settlement aims to provide compensation for all future medical expenses related to the workplace injury.

Impairment Rating

In Pennsylvania, the impairment rating is determined by a workers’ compensation doctor and will influence the settlement amount. Disability ratings under 50% are considered partially disabling, and over 50% are totally disabling. 

Wage Loss Benefits

The wage loss benefits the injured worker is entitled to receive also impact the settlement, as well as future wage loss. 

Negotiation and Legal Representation

The negotiation process is critical. Injured workers often seek legal representation from a Philadelphia work injury attorney to ensure their rights are protected and receive fair compensation.

Settlement Structure

The structure of the settlement can vary. It may involve a compromise and release, where the injured worker receives a lump sum in exchange for releasing the employer from future liability. Alternatively, it could be a stipulated settlement, where the parties agree to a fixed amount paid over time.

Vocational Rehabilitation and Return to Work

If vocational rehabilitation services are involved or if there are considerations related to the injured worker’s ability to return to work, these factors may influence the settlement.

Legal Requirements and Approval

All lump sum settlements in workers’ compensation cases are subject to review by a workers’ compensation judge. The judge ensures that the worker comprehends the terms of the agreement before granting approval. However, determining whether the agreement is fair primarily falls on the worker and their attorney. Once approved, these settlements are final, meaning the worker relinquishes any entitlement to lifetime benefits and is barred from reopening their claims in the future.