The most common settlement question online is some version of this: here is my rating, here is my offer, is it fair?
Someone posts a 25 percent permanent disability rating, several accepted body parts, ongoing restrictions, a possible future surgery, and a $70,000 offer, and asks whether countering at $150,000 is reasonable. Someone else posts a 12 percent rating and a $35,000 offer after a spinal fusion. Someone else has a 21 percent whole person impairment after a thoracic fracture and wants to know what a compromise and release should look like.
I understand exactly why people ask. I also have to tell you that the answers they get back are close to worthless, and this page explains why.
What California Workers Are Asking on Reddit About Settlements
- I have a 25 percent rating and they offered $70,000. Is that low?
- What is the average settlement for a back injury in California?
- How do I know if my attorney is telling me to take a bad deal?
- Should I counter, and by how much?
- How long does it take to actually get the money?
- My rating is higher than someone else’s but my offer is lower. How?
Why Reddit Settlement Numbers Are So Misleading
This is the section I most want you to read.
When someone posts “I got 20 percent and $60,000,” that number carries almost no information about your case, because permanent disability percentage is only one input among many. Two workers with identical 20 percent ratings can have settlements that differ by a factor of three, for entirely legitimate reasons.
Consider two people, both rated 20 percent:
Worker A is 28 years old, a sedentary office worker, injured in 2019, with no apportionment, one accepted body part, no future surgery contemplated, and no wage loss.
Worker B is 58 years old, a heavy laborer, with 40 percent of the disability apportioned to pre-existing degeneration, three disputed body parts, a recommended fusion that has not been performed, unpaid retroactive temporary disability, and no return to work.
Same percentage. Radically different cases. Worker B’s file may be worth several times Worker A’s, or considerably less, depending on how the disputes resolve. Neither of them can learn anything useful from the other’s number.
What Actually Determines a California Settlement
The permanent disability rating itself is built from more than an impairment number. A whole person impairment figure from the AMA Guides gets adjusted for your occupation and your age, which is why the same impairment produces different disability for a roofer and a receptionist.
Then the value of the case turns on:
- Apportionment. Under Labor Code section 4663, disability caused by non-industrial factors is subtracted. This is frequently the single largest variable, and it is heavily litigated.
- Which body parts are accepted and which are disputed. A disputed body part is a contingency, not a certainty.
- Unpaid or underpaid temporary disability. Retroactive TD can be a substantial component people forget to count.
- Future medical care. Often the largest number in the case, and the one most commonly given away too cheaply.
- Whether you returned to work, and whether your employer offered regular, modified, or alternative work.
- The supplemental job displacement voucher, worth $6,000, plus the $5,000 return-to-work supplement.
- Liens, including EDD, group health, and medical providers, which come out of the recovery.
- Litigation risk. How strong is causation? How good is the medical-legal reporting? What happens if the case is tried?
C&R Versus Stipulations Changes What the Number Means
A settlement figure is meaningless until you know which kind of settlement it is.
Stipulations with Request for Award pay permanent disability over time and leave future medical treatment open. The carrier remains responsible for treating your injury, potentially for life.
Compromise and Release is a lump sum that generally closes the case entirely, including future medical. You take responsibility for your own future care.
So a $70,000 C&R and a $70,000 Stipulated Award are not the same deal at all. In the C&R, some of that money is buying out medical care you will otherwise need to pay for yourself. If you have a recommended fusion that has not happened, closing future medical for a modest premium can be a serious mistake.
When someone posts an offer without saying which structure it is, nobody answering can possibly evaluate it.
The Condition on a C&R That Nobody Mentions
There is a practical requirement attached to the lump sum that rarely comes up in these discussions. No statute requires you to resign in order to settle, but defendants typically will not offer a Compromise and Release unless the injured worker agrees to resign, because the finality they are paying for is incomplete if you return to the same job and can be reinjured there.
That means the choice of structure and the decision about your job are usually one decision, not two. If keeping your job matters to you, Stipulations is realistically your path. I cover this in detail on whether you have to quit or resign to settle.
How the Process Actually Runs
Settlement generally comes after you reach maximum medical improvement, also called permanent and stationary status, because until your condition stabilizes nobody can rate permanent disability. The medical-legal evaluator’s report drives the rating, the rating drives the negotiation, and the negotiation produces documents that go to a workers’ compensation judge.
A settlement is not final until a judge approves it. The judge reviews for adequacy, which is a genuine protection, particularly for unrepresented workers. Once approved, payment is due within 30 days of the Order Approving Compromise and Release, and penalties accrue if the carrier is late.
Common Misconceptions
That injury plus percentage equals value. It does not. Age, occupation, apportionment, disputed parts, future medical, and wage loss all move the number.
That there is an “average settlement” worth knowing. Averages across wildly different cases tell you nothing about yours.
That the first offer reflects what the case is worth. It reflects what the carrier hopes you will accept. I do not take first offers.
That a bigger lump sum is automatically better. If it closes future medical on a case with surgery pending, it may be much worse.
That you can take the lump sum and keep the job. Usually not. Defendants typically condition a C&R on resignation.
That your attorney’s fee explains a low offer. The fee is generally around 15 percent, set by statute and approved by the judge, and it comes out of a recovery that is usually substantially larger because counsel was involved.
That settling is always the goal. Sometimes the right answer is Stipulations with open medical, and sometimes it is trying the case.
If You Have an Offer in Front of You
- Find out whether it is a C&R or Stipulations. Nothing else can be evaluated until you know.
- Ask whether resignation is a condition of the offer, and what that costs you in wages and health coverage.
- Ask what the rating string actually is, including apportionment, and whether all body parts are included.
- Ask what future medical is worth if the case is being closed. Get an estimate rather than a guess.
- Confirm the voucher is addressed. Many adjusters never issue it, and losing it costs $6,000 plus the $5,000 supplement.
- Identify every lien. They come out of your money.
- If you are 62 or older, or on Medicare or SSDI, raise Medicare set-aside issues early. They can reshape the whole structure and cause long delays if handled late.
- Do not accept because you are exhausted. Carriers understand financial pressure and it is reflected in offers.
Frequently Asked Questions
What is the average workers’ comp settlement in California?
There is no meaningful average. Settlement value depends on the permanent disability rating as adjusted for age and occupation, apportionment, accepted versus disputed body parts, unpaid temporary disability, the value of future medical care, return-to-work status, and liens. Two workers with the same rating routinely settle for very different amounts.
Why is my settlement offer lower than someone with the same disability rating?
Most often apportionment, whether future medical is being closed, whether body parts are disputed, and your age and occupation. Two identical ratings can produce very different values.
What is the difference between a C&R and Stipulations?
A Compromise and Release is a lump sum that generally closes the case including future medical care. Stipulations with Request for Award pay permanent disability over time and leave future medical open, with the carrier still responsible for treatment.
Do I have to resign to get a lump sum settlement?
No statute requires it, but defendants typically will not offer a Compromise and Release unless the injured worker agrees to resign. Workers who want to keep their jobs generally resolve by Stipulations instead.
Should I accept the first settlement offer?
Rarely. A first offer reflects what the carrier hopes you will take, not what the case is worth, and it is usually made before the medical-legal record is fully developed.
How long after settlement do I get paid in California?
Payment is due within 30 days of the Order Approving Compromise and Release. Penalties accrue if the carrier pays late.
Does a settlement have to be approved by a judge?
Yes. A California workers’ compensation settlement is not final until a workers’ compensation judge reviews and approves it, including reviewing whether the settlement is adequate.
Get Your Case Valued, Not a Stranger’s
Valuing a workers’ compensation case is more art than science. It takes an accurate estimate of what the claim is genuinely worth and a working knowledge of what the carrier believes it is worth, which are often two different numbers. If you have an offer in front of you, contact my office for a free consultation before you sign anything.
Ryan D. Kayrell, PC represents injured workers throughout California from Irvine, Orange County. This page is general information about California workers’ compensation law, not legal advice for your situation, and reading it does not create an attorney-client relationship. Nothing here predicts or guarantees any result. Questions described here are paraphrased from public online discussions and do not reflect any client of this firm.