Workers’ Compensation 10 : Third-party Settlement

Q: While on the job, I was struck from behind by a van.  A Workers’ Compensation Law Judge concluded that I had suffered a compensable injury to my lower back, and made awards for my periods of disability.

I also filed a ‘third-party’ action against the driver and owner of the van.  When asked by my attorney to consent to my settlement of this third-party action, my employer wrote, “Consent is given.  We are assuming that your settlement is for the policy limit.”

A: Under section 29 of the Workers’ Compensation Law, you may pursue a legal action against a third party for damages arising out of the accident underlying your workers’ compensation claim.  Generally, after the recovery, your employer has a lien, to the extent of past compensation and medical expenses disbursed, plus the right to offset your future compensation benefits – a ‘payment holiday’.

However, unless an employer or carrier unambiguously and expressly reserves this lien or this right to offset when giving consent, the lien or offset is waived.  From what you tell me, it does not look like your employer did make such a reservation, which means that you can keep the whole settlement and, moreover, need not suffer an interruption of payments from your employer.

By: Scott Baron,
Attorney at Law Advertorial

The law responds to changed conditions; exceptions and variations abound. Here, the information is general; always seek out competent counsel. This article shall not be construed as legal advice.

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