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Workers Compensation Settlement Archives

Workers Compensation Settlement Lump Sum

In Wisconsin a workers compensation settlement is often done with the workers compensation insurance company paying a lump sum amount of money to the injured worker in return for a release called a limited compromise (usually just leaving future medical expense open subject to a Medicare set-aside account) or a full and final compromise. The lump sum payment by the insurer represents a negotiated settlement compromising the claims for workers compensation temporary total disability and permanent partial disability in most cases. The cases settle for many reasons, but basically neither side wants to risk either getting less (the employee) or paying more (the insurance company). It is very important to realize, and we go over this with every client in the initial consultation, that lump sum settlements in Wisconsin workers compensation cases are not like car accident settlements. Because workers compensation is at government administered wage replacement system, the government exercises an interest in seeing that the settlement funds are not dissipated. The workers compensation law permits all accrued benefits to be paid up front to the injured worker, but unaccrued benefits are generally put into a restricted bank account for the benefit of the injured worker. The injured worker is allowed to withdraw a monthly amount equal to what workers compensation payments would be at that time. If total permanent disability is not claimed, the department will instruct the savings institution to release the principal at the current permanent partial disability (PPD) rate plus accrued monthly interest. See Wis. Admin. Code § DWD 80.03(1)(e). Accrued benefits are defined as those benefits, generally weekly TTD or monthly PPD payments, that would have been paid to the injured worker had the insurance company not denied benefits. The government, through the Workers Compensation Division of Workforce Development, determines what the accrued benefits amount to. In addition, the administrative law judge can allow medical expenses and an additional $10,000 in unaccrued benefits, may be paid to the employee as a lump sum. Wis. Admin. Code § DWD 80.03(1)(d). After the compromise is approved by the judge, the injured worker can request additional money out of the restricted account. The request is made on Form WKC-136, Advancement or Lump Sum Request and directed to the DWD. Orders on compromise or stipulation must be paid within 21 days. See Wis. Stat. § 102.18(1)(e) of the judge signing the order.

How Long Does a Workers Compensation Settlement Take

How long does a workers compensation settlement take depends on several factors.  The most important factor is whether the work-related injury is temporary or permanent.  If an injury is temporary, meaning the injured worker healed with no permanent injury then there is usually no settlement to speak of.  If the employee missed work, he or she is paid worker's compensation, called temporary total disability (TTD) in Wisconsin, while in the period of healing.  There would only be a settlement if the insurance company denied paying TTD, the injured worker makes a claim for it and they settle after the worker returns to work.

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