Under Massachusetts’ Workers’ Compensation Act, a lump sum settlement cannot be imposed on an employee who no longer consents to its terms. This was emphasized by a recent Massachusetts decision reaffirming that a valid settlement under Chapter 152 requires a true meeting of the minds. If you are navigating a workers’ compensation claim and have concerns about settlement pressure, it is important to speak with a Massachusetts workers’ compensation attorney to ensure your rights are protected.
Factual History and Procedural Background
It is reported that the employee sustained injuries to his lower back after being struck by a forklift during the course of his employment. Following the incident, the employee received temporary total incapacity benefits under G.L. c. 152, § 34. The employer’s workers’ compensation insurer later filed to reduce or terminate those benefits. After proceedings before the Department of Industrial Accidents, the insurer was ordered to continue paying benefits under § 35 for partial incapacity.
It is further reported that two years later, the parties negotiated a lump sum settlement. However, shortly after an initial administrative hearing, the employee allegedly had second thoughts about entering into the agreement. This change of heart was reportedly prompted by a recent MRI indicating that his back condition was worse than he had previously understood. The employee, through counsel, informed both the insurer and the administrative judge that he no longer wished to proceed with the lump sum agreement.
It is alleged that despite the employee’s clear revocation of consent, the administrative judge convened a hearing at which the employee’s attorney submitted the original settlement agreement with the word “VOID” written across the face. At the hearing, counsel outlined the employee’s reasons for withdrawing from the settlement, citing concerns that his medical condition had deteriorated and that settling at that time would not be in his best interest.
Nonetheless, the administrative judge approved the lump sum settlement over the employee’s objections. The approved agreement called for a net payment of $20,000 to the employee in exchange for waiving future weekly benefits. The employee then filed suit seeking a declaration that the forced settlement was invalid. The trial court dismissed the case on jurisdictional grounds, asserting that the employee had failed to exhaust administrative remedies. The employee appealed.
Grounds for Voiding a Settlement
The appellate court reversed the trial court’s dismissal and held that the employee was not required to pursue further administrative remedies before seeking relief in court. More significantly, the court held that the administrative judge had no legal authority under G.L. c. 152, § 48 to approve a lump sum agreement where one party, particularly the employee, had withdrawn consent prior to approval.
The court emphasized that § 48 requires not only that the parties agree to the settlement but also that the Department approve the agreement as being in the claimant’s best interest. The statute contemplates a completed and voluntary agreement, and without mutual consent, no enforceable settlement exists for the Department to approve. The court found that there had been no meeting of the minds between the employee and the insurer and, therefore, the administrative judge’s approval was invalid and exceeded the judge’s statutory authority.
As such, the court directed the trial court to enter judgment declaring the settlement void and to reinstate the employee’s claims before the Department so that he could pursue his case through the usual administrative process.
Consult a Knowledgeable Massachusetts Workers’ Compensation Attorney
A lump sum settlement under the Workers’ Compensation Act must be voluntary and informed. If you are being pressured to accept a settlement that no longer serves your interests, or if you believe your rights have been compromised in the claims process, you may have grounds to challenge the agreement. Attorney James K. Meehan of the Law Office of James K. Meehan is a knowledgeable Massachusetts workers’ compensation attorney who advocates for injured workers throughout the state. For a confidential consultation, contact the firm at 508-822-6600 or reach out through our online form.