What is a Compromise and Release Agreement?

A compromise and release agreement, or C&R as they are more commonly known, is essentially a workers’ compensation law term for a settlement agreement. The main purpose of a C&R is to allow you and the insurance company to reach an agreement and avoid a lengthy litigation process. It is important to remember, though, that a C&R is not appropriate in every case, and at times the insurance company will not be willing to offer a sufficient settlement amount for it to be in your best interest.

A C&R allows for the release just wage benefits or wage loss and medical benefits. Specific loss benefits and all other benefits, including deaths occurring within 300 weeks of the injury, can be released. Payments from a C&R agreement can be structured in installments, lump sums or continued payments of medical expenses. A C&R of future wage loss benefits is a full and final settlement, so even if your injury gets worse and totally disables you at some point in the future, you cannot reinstate your claim against your employer.

Pennsylvania workers’ compensation law requires that a workers’ compensation judge approve all C&R agreements at a hearing. At the hearing, your attorney will ask you questions about the C&R agreement, mostly aimed at ensuring that you are aware of the contents of the agreement and its legal significance. Often the opposing attorney will ask questions as well, for the same reasons. In some cases, the judge will also ask questions if he or she feels that some area needs to be covered more in depth. As long as the judge believes that you understand the agreement, it will then be approved and you will receive a settlement check within 30 days of the written decision approving the settlement. The judge is not making a determination whether the settlement is in your best interest.

It is important to note that, in many cases, you will be asked to sign several other agreements in addition to the C&R agreement. Pennsylvania law requires any workers’ compensation claimant to certify that they do not owe any child support payments, and you will be required to sign an affidavit regarding your child support payment status. In addition, some employers require you to sign a resignation letter, often stating that you resign your job and will not seek employment with them again. In some cases, you will be asked to sign an additional settlement agreement, for some additional amount of money, usually forbidding you from saying anything negative about your employer or disclosing any information about the settlement to the press or others.

An ethical and experienced workers’ compensation attorney can help walk you through the C&R agreement process, and make sure that you receive the best possible settlement, if settlement is in your best interest. If you are or may be receiving Social Security Disability benefits, it is very important to understand how these benefits interact with workers’ comp wage loss benefits and how to potentially maximize both.

If you have more questions about compromise and release agreements, fill out our online form or call us at (717) 695-4722 for a free case evaluation!

The law firm of Calhoon and Kaminsky P.C., represents injured workers and those seeking Social Security Disability throughout Pennsylvania, including but not limited to, Altoona, Harrisburg, Pottsville, Allentown, Reading, Bloomsburg, Easton, Bethlehem, Norristown, Bristol, Williamsport, State College, Wilkes-Barre, Scranton, Lancaster, Waynesboro, York and all cities in Bucks County, Chester County, Columbia County, Dauphin County, Delaware County, Lackawanna County, Lancaster County, Lebanon County, Lehigh County, Luzerne County, Lycoming County, Montgomery County, Monroe County, Montour County, Northampton County, Northumberland County, Philadelphia County, Pike County, Schuylkill County, Wyoming County and York County, PA. Our offices are located at 2411 North Front Street, Harrisburg, PA and 14 North Main Street, Suite 300, Chambersburg, PA, and we can arrange for meeting locations at law offices throughout the State.

Calhoon and Kaminsky P.C.
2411 North Front Street
Harrisburg, PA 17110
1-717-695-4722

14 North Main Street
Suite 309
Chambersburg, PA 17201
1-717-695-4722