In New Jersey, your workers’ compensation claim can be settled in one of two ways: an Order Approving Settlement or an Order Approving Settlement With Dismissal. 

An Order Approving Settlement is presented to the Judge of Compensation for approval after the parties have negotiated a settlement that ascribes a percentage of disability to the injured area of the body. For example, if you twisted your knee and had surgery to repair a torn meniscus, you might get an award of 20% disability of the leg. This would entitle you to receive a monetary award in accordance with the schedule of benefits. The entry of this award does not mean that you cannot work; it simply means that you have an injury that has a permanent impact on your life. As long as the injury affects your daily or working life, you have proven that you have a permanent injury.

In addition to the monetary award, you also retain the right to reopen your case. The right to reopen your case expires after two years from the date that you receive your last payment of benefits. It is not an automatic right; you must file an Application to Review or Modify Formal Award within the two year window in order to preserve your rights. If you can show that your injury has become significantly worse, you may be entitled to additional medical treatment, temporary disability benefits if you have to be out of work and possibly even an additional award of permanent disability. While you have the right to reopen your claim, you must show that the original injury has gotten worse and that you have not had any new accidents or injuries affecting your leg.

An Order Approving Settlement with Dismissal is a lump sum settlement that closes the case forever. The parties present this type of settlement to the Judge of Compensation for approval when there are issues in the case that would make it difficult for the injured worker to prove her case. Those issues might be whether or not the court has jurisdiction to hear the case, whether or not the accident was directly caused by the work effort or if there was some other reason; whether or not the employer is liable for the injuries alleged, and in the case of death – whether or not anyone in the deceased workers’ household was a dependent as defined by the law.

Jurisdictional issues arise if you live and work in another state, but got hurt in New Jersey or vice versa. There are certain circumstances where New Jersey may not be the proper forum for that case. Causal relationship issues arise if you had a prior or subsequent accident involving the same part of your body and you are unable to determine how much of the overall disability was caused by the work accident. Liability issues arise if you may not have been performing your job at the time of the accident or if the injury could have occurred at anytime and it was a coincidence that it occurred at work. For example, if you are injured on your way to or from work or during a lunch break or you sneeze and suffer a neck or back injury. Dependency issues arise if you do not meet the definition of dependent under the workers’ compensation statute. It is not defined the same was as in family court or even for income tax purposes. In these types of cases, rather assume the risks inherent in a trial, the parties reach a compromise and present a settlement to the judge that once approved ends the case. The settlement requires the injured worker to give up any future rights that they might otherwise be entitled to.