Workers' compensation claims may be settled. All settlement agreements must be approved by a Commission judge. This also applies to cases not in the hearing process. There are two types of settlements: (1) disputed validity/compromise and (2) commutation.
A "disputed validity" or compromise settlement must involve a real dispute between the parties over whether a claim is legally payable. Settlement of these disputed claims allows the parties to assess the strengths and weaknesses of their respective positions and then strike a compromise in order to avoid the risk, expense and delay of further adjudication.
A "commutation agreement" involves very different considerations. Here, the injured worker's right to benefits has been established and is no longer in doubt. The only question before the judges is whether the parties should be allowed to substitute their own method of paying those benefits for the payment provisions otherwise required by the Utah Workers' Compensation Act.
Recently, the Adjudication Division developed model forms for both disputed validity (compromise) and commutation agreements. Use of these forms is not mandatory.
All settlements on cases not currently in the hearing process must be submitted to the Division’s Southern Utah office for review or via e-mail at firstname.lastname@example.org. Follow the links below for more information about how settlement agreements are evaluated by the judges and read the Commissioner’s letter outlining the public policy behind settlement agreements.