Compromise and release (C&R)

What a C&R is

A compromise and release settles a workers' comp case for a lump sum. It typically resolves all benefits, including future medical treatment, in exchange for one payment. It is the main alternative to stipulations with request for award, which keep future medical open.

The rule

No release or compromise is valid unless a workers' compensation judge or the Appeals Board approves it (Labor Code section 5001). When filing a C&R, the parties must file the AME, QME and treating reports relevant to whether the settlement is adequate. The judge inquires into adequacy and may set a hearing. An agreement paying less than the full compensation due and releasing future liability is approved only where reasonable doubt exists about the parties' rights or approval is in their best interest (8 CCR 10700). Once approved, accrued penalty claims are conclusively presumed resolved unless the agreement expressly excludes them (Labor Code section 5814(c)).

Why it matters to an applicant firm

A C&R ends the client's right to employer-paid treatment for the injury, so the price of future care has to be in the number. Liens, EDD overpayments, the attorney fee the judge sets, and any Medicare interest all need to be settled or accounted for before the walkthrough or mandatory settlement conference. Penalty claims the firm wants to keep must be carved out in writing. The C&R vs stipulations guide compares the two.