The point at which a compromise and release agreement is proposed in a California workers’ compensation case varies significantly. It is dependent on factors specific to each claim. This includes the severity of the injury, the extent of medical treatment required, the stability of the employee’s medical condition, and the existence of any legal disputes. The negotiation process often commences once the injured worker has reached maximum medical improvement (MMI), meaning their condition has plateaued and further treatment is unlikely to yield significant improvement.
Resolving a workers’ compensation claim through settlement offers numerous advantages. It provides closure for both the employee and the employer, eliminating the uncertainty and potential costs associated with ongoing litigation. For the injured worker, it offers a lump-sum payment that can be used for future medical care, vocational rehabilitation, or other personal needs. Historically, settlements have become a common mechanism for managing workers’ compensation claims, promoting efficiency and reducing administrative burdens on the workers’ compensation system.