Workers’ Compensation Settlements: Protecting Your Social Security Benefits and Rights

workers_road_workers_site-scaledSettling a lawsuit can have many far-reaching effects. Not only will it result in the dismissal of your lawsuit, but it could also affect things such as your social security benefits. Therefore, it is important that you consult with an attorney and carefully consider if a settlement is in your best interest. Additionally, as seen in this case, if you accept a settlement offer, you must ensure the related court order includes all required aspects so you do not have to deal with unintended consequences. 

Kenneth Clark and his employer, Walgreens, reached a settlement related to Clark’s workers’ compensation claim. A workers’ compensation judge approved the settlement and entered a judgment dismissing the claim. Clark then petitioned the workers’ compensation judge to amend the judgment to include language to divide the indemnity part of his settlement across his lifetime. This proposed amendment would not change the total amount of the settlement. Clark wanted this amendment so the Social Security Administration could pro-rate the settlement so it could calculate the required disability offset. Walgreens objected to this amendment. After a hearing, a workers’ compensation judge entered an amended order reflecting Clark’s requested language. Walgreens appealed. 

On appeal, Walgreen argued the trial court did not have jurisdiction to amend the initial order approving Clark’s settlement with Walgreens. La. R.S. 23:1272 governs the settlement of workers’ compensation claims. This statute has many safeguards for preventing an employee from being pressured to improperly settle his or her claim. Courts are to liberally construe workers’ compensation law in favor of workers to protect them from the burden of workplace injuries. 

Clark subsequently requested the court amend the initial order of approval because his counsel had not advised him to request language related to the indemnity portion of the settlement, which the Social Security Administration requires. Under La. C.C.P art. 1951, a judgment can be amended to alter the phrasing if it does not alter the judgment’s substance. Here, the purpose of amending the judgment was to include the language the Social Security Administration required. The amendment did not affect Clark’s or Walgreens’ rights or obligations and did not add anything substantive to the order. The added language would assist the Social Security Administration in determining its offset from Clark’s settlement.  Because the amendment just changed the phraseology and not the substance of the order, the appellate court disagreed with Walgreens’ argument the court did not have jurisdiction to amend the initial order.

As seen here, many unique requirements exist for settling a workers’ compensation claim. If you are involved in a workers’ compensation dispute, it is important to consult with a good attorney who can advise you on possible paths forward. It is especially important to consult with an attorney if you are considering a possible settlement of your workers’ compensation claim. A good attorney can help review the settlement and associated court order to ensure it is in your best interest and contains all required aspects. 

Additional Sources: Kenneth Clark v. Sedgwick CMS, et al.

Article Written By Berniard Law Firm

Additional Berniard Law Firm Article on Amended Judgments: A Louisiana Court Signs Two Final Judgments, What Happens?

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