Workers' Comp Settlements in Colorado

An injured worker may settle all or part of a claim for compensation, benefits, penalties or interest. The settlement must be in writing, signed by the employer or insurer, and signed and sworn to by the worker. It must be reviewed in person with the worker and approved in writing by an administrative law judge or the Director of the Division of Workers' Compensation before it is final, and it is filed with the Division. If the settlement says the claim will not be reopened, it can be reopened only for fraud or a mutual mistake of material fact. A lump sum is due within 15 calendar days after the insurer or employer receives the signed settlement order.

Colorado does not set a fixed number of weeks for temporary benefits. Temporary total disability continues until the first of these: the worker reaches maximum medical improvement, returns to regular or modified work, gets a written release to return to regular work, or is released to modified work that is offered in writing and does not start it. Temporary partial disability ends at maximum medical improvement or if the worker fails to start an offered modified job. Instead of a week limit, the law caps the combined total of temporary and permanent partial disability payments by dollar amount, with a higher cap for impairment ratings above 19 percent; for claims arising on or after January 1, 2025 the caps are $185,000 and $300,000, adjusted each July 1. Permanent total disability continues until the worker's death.

Colorado workers' comp attorneys must give clients a written fee agreement. In unappealed contested cases, a contingent fee above 25% of the contested benefits is presumed unreasonable, and no contingent fee may be applied to previously incurred medical benefits in a permanent disability award. At the request of the worker or the attorney, the Director of the Division of Workers' Compensation decides which benefits were contested and whether the fee is reasonable (request within 180 days after the final order); the Director may allow more than 25% if an appeal was perfected or the attorney devoted an extraordinary amount of time.