At EMD Law, we understand how a work-related injury can create uncertainty about your health, finances and long-term stability. While many workers receive ongoing benefits through the New York workers’ compensation system, some may reach a point where a settlement becomes the best option. This guide outlines how the settlement process works, when it applies, and what to consider before agreeing to any final terms.
What Is a Workers’ Compensation Settlement?
A workers’ compensation settlement is a formal agreement between you and the insurance carrier to resolve your claim, often through a one-time lump-sum payment or a structured payout over time. In New York, there are two primary forms of settlements: a Section 32 agreement, which may close out your rights to future benefits entirely or partially, and a Schedule Loss of Use (SLU) award, which compensates you for permanent impairment to a specific body part after reaching maximum medical improvement.
When Do Settlements Typically Happen?
Settlements can occur at various stages of a claim but are most common once your medical provider determines that you have reached maximum medical improvement. This means your condition is stable and unlikely to change with further treatment. In many cases, settlements are pursued when a permanent partial disability is involved or when there is disagreement over the degree of impairment or benefit eligibility. Some injured workers may also prefer a single payment instead of ongoing wage replacement checks, especially if they are transitioning into a new career or moving on from their job entirely.
Importantly, no one can force you to settle your claim. Accepting a settlement is completely voluntary and should only be done when you understand what you are agreeing to and how it will affect your future benefits and rights.
What to Consider Before Settling
Settlements are final, which makes it critical to evaluate several factors before making a decision. One of the most important considerations is whether you will still have access to medical treatment after settlement. Some Section 32 agreements include continued medical care, while others waive that right entirely. You also need to assess whether the proposed amount fairly compensates for your lost wages, especially if your injury limits your future earning capacity.
Another factor to examine is the potential impact on Medicare. If you are receiving or expect to receive Medicare benefits, a Medicare Set-Aside (MSA) arrangement may be necessary to ensure that future medical expenses are properly allocated and do not interfere with your government benefits.
At EMD Law, we help injured workers evaluate all of these considerations and more, so they can make informed decisions based on both their immediate needs and their long-term outlook.
Understanding the Settlement Process
The settlement process begins once your doctor determines that you have reached maximum medical improvement and provides a medical assessment regarding permanent impairment. This report becomes the foundation for any potential settlement or SLU award.
Our team will then engage in direct negotiations with the insurance company. We carefully review your medical records, your employment history, and your future needs to advocate for a settlement that accurately reflects the full impact of your injury. Once both parties agree on the terms, a formal agreement is drafted—often in the form of a Section 32 document. This agreement will clearly state the amount of compensation and what rights are being resolved.
Before a settlement becomes official, it must be reviewed and approved by a Workers’ Compensation Law Judge. During this review, the judge ensures that the agreement is fair and that you understand the legal implications of signing it. After approval, you will receive payment according to the terms of the settlement. Most are paid out as a lump sum, although in certain cases, payments may be structured over time.
Can a Settlement Be Reversed?
Once a settlement is approved by the Workers’ Compensation Board, particularly a Section 32 agreement, it is considered final. In almost all cases, you cannot reopen your claim or seek additional benefits related to the same injury after settlement. This is why it is essential to consult with an experienced attorney before signing any agreement. A rushed or misinformed decision can result in the loss of critical medical coverage or wage compensation down the line.
How EMD Law Supports Injured Workers
At EMD Law, we provide strategic, honest and informed counsel to every client considering a settlement. Our attorneys will guide you through the entire process, from medical review to negotiation and final approval. We will also explain what each term of the agreement means and how it could affect you years down the line.
Our firm has successfully helped thousands of injured workers across New York maximize their workers’ compensation benefits through settlements and court proceedings. Based in Albany, we proudly serve clients throughout the Capital Region and beyond.