Workers' Comp Settlements in Texas

Texas law limits settlements. A settlement may not pay benefits in a lump sum (except for the limited commutation of impairment income benefits allowed by § 408.128) and may not limit or end the employee's right to medical benefits. A settlement resolving impairment cannot be made before maximum medical improvement. Every party and the Commissioner of Workers' Compensation must sign it; the Commissioner approves it only if it reflects the agreement, follows the law and is in the claimant's best interest. If the Commissioner does not act within 16 days, it is treated as approved, and a party may withdraw before it takes effect.

Temporary income benefits continue until the employee reaches maximum medical improvement (MMI). By law, MMI is reached no later than 104 weeks after income benefits begin to accrue, although the Division may extend that period if the employee has had or been approved for spinal surgery within 12 weeks before it expires. Impairment income benefits then run for three weeks for each percentage point of impairment (or until death, if earlier). Eligibility for temporary, impairment and supplemental income benefits ends 401 weeks after the date of injury. Lifetime income benefits for listed catastrophic injuries are paid until the employee's death.

Under Texas Labor Code 408.221, a claimant's attorney fees must be approved by the DWC commissioner or a court and may not exceed 25 percent of the injured employee's benefits; fees are paid out of those benefits. TDI says an attorney can charge a maximum of $200 per hour plus expenses. Free state help: the Office of Injured Employee Counsel (OIEC) provides ombudsmen at no cost to injured employees (and beneficiaries in work-related death cases) who don't have an attorney; they help communicate with the employer, carrier and doctor, explain the hearings process and attend proceedings with you, but don't give advice or sign agreements for you. OIEC: (866) 393-6432.