Will Signing a Severance Agreement Cut Off Your Workers' Comp Benefits?


Will Signing a Severance Agreement Cut Off Your Workers’ Comp Benefits?

After a serious injury at work, your employer offers you a severance payment if you sign an agreement and resign your job. Since you are having trouble doing your job with your restrictions, you want the severance. But you wonder if signing the severance agreement will cut off your right to workers’ compensation benefits.

Severance agreements usually say that you will receive a lump sum of money from your employer upon your resignation or termination. In turn, you usually promise that you will not sue the company and that you will keep company information confidential. The agreement may require that you do other things too. Since employers draft settlement agreements, they may not be as favorable for the employees as for the employers. The release of claims (saying you will not sue the company) is one particular paragraph where employers may take advantage.

Specifically, the release of claims may include language saying that you release all legal claims against the employer, including claims for workers’ compensation benefits. If you sign the release, you cannot sue the employer for unpaid wages or other claims. However, you may still be able to recover workers’ compensation benefits in some situations.

In Minnesota, a judge must approve most agreements that release the right to workers’ compensation benefits. Both the injured employee and the employer must sign the agreement, and so must the insurance company if the employer is not self-insured. If anyone who signs does not have an attorney, then a judge must approve the agreement. Usually the employee is the only one without an attorney.

If the employee does not have an attorney, a workers’ compensation judge does a detailed review of the settlement agreement. Also, if the agreement releases the employee’s right to medical or vocational rehabilitation benefits, the judge must do a detailed review. If attorneys represent everyone who signs, then the judge will usually sign off on a settlement relatively quickly.

In other words, you cannot sign away your right to workers’ compensation benefits in a severance agreement if you do not have a lawyer, unless the employer gets it approved by a judge. If you had not even filed a workers’ compensation case yet or were unaware of your rights, you may be able to get the agreement set aside too.

Exercise extreme caution when signing severance agreements. If you think the agreement may include a release of your workers’ compensation claims, consult a lawyer to find out your rights. If you were injured on the job and are about to be terminated or resign, speak to a lawyer today to find out if you have a case for benefits.

Need help getting workers’ compensation for your injury? Joe Osterbauer, Esq. and the Osterbauer Law Firm stand up for injured Minnesota workers’ rights. Joe’s 27 years of workers’ compensation experience and his team’s speedy service combine to get clients the results they need. To schedule a free consultation, visit Osterbauer Law Firm online or call Joe’s office at (612) 334-3434.