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Section 20 Settlement in New Jersey Workers' Compensation

In the vast landscape of New Jersey Workers’ Compensation, the “Section 20” settlement stands as a unique path. It’s akin to a once-and-done deal, meaning that there’s no going back once you agree to it. Hence, understanding its nature and limitations becomes crucial for injured workers.

What is a Section 20 Settlement?

At its core, a Section 20 settlement is a lump sum payment made to the injured worker. What sets it apart is its “full and final” status. After accepting this settlement, you can’t reopen your claim in the future, even if your condition worsens. The employer does not admit liability or causation for the injury.  

A brief case with words case closed on top of it showinbg that the injured worker's settlement is in full and final status.

Why Consider Section 20?

The appeal of a Section 20 settlement often lies in its immediacy. It’s attractive when:

  • The causal relationship between the injury and the work is disputed.

 

  • The liability for the injury is in dispute, typically involving an issue as to employment;

 

  • The jurisdiction of the Court over the matter is in dispute.

Court Approval – Not a Mere Formality

Given its irreversible nature, courts don’t rubber-stamp these settlements. They’ll ensure:

  • Both parties understand the implications fully.

 

  • The circumstances genuinely warrant such a settlement.

 

In short, the injured worker and the employer (or the insurance carrier) must clearly understand that accepting a Section 20 settlement means closing the case permanently. This understanding ensures that the worker is fully informed and is not being taken advantage of.

 

The Judge of Compensation will ask specific questions of the injured worker to make a firm judicial determination on the issue of voluntariness and knowledge of the terms of a Section 20 settlement. The Judge must carefully examine the reasons for the Section 20 settlement to ensure they align with the law’s intent.

Potential Downsides

The employer or their insurance will provide no future medical benefits (or any other) for this injury.

 

If your condition deteriorates, you can’t seek additional compensation related to this injury.

 

Section 20 settlements offer quick resolutions but come with a price: finality. For those unsure about their injury’s future trajectory, it’s essential to approach this option with caution. Always consult with an experienced NJ Workers’ Comp attorney to understand if this route is right for your unique situation.

 

"Let us never negotiate out of fear. But let us never fear to negotiate."

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