When you have reached maximum medical improvement (MMI), it may be time to consider a lump sum settlement of your workers’ compensation case. Under the Workers’ Compensation Act, an injured employee is entitled to a settlement for a Permanent Partial Disability (PPD). Your PPD award is what people consider their workers’ compensation settlement. In our experience, it is not uncommon that the workers’ compensation insurance company never even mentions your entitlement to a PPD award. If an injured employee doesn’t hire an Oak Lawn workers’ compensation lawyer, they may not know they are entitled to money for their injury. But how much is a workers’ compensation case worth?

Calculating a PPD settlement

As a worker’s compensation attorney can explain, the value of your workers’ compensation case is based on several factors. To calculate your workers’ compensation settlement, you multiply 60% of your Average Weekly Wage (AWW) times the number of weeks compensation for the part of the body you injured times the percent disability. Sound confusing? Let’s break down each element which goes into your PPD award.

Calculating Average Weekly Wage

Your AWW is your gross earnings over the preceding 52 weeks, divided by 52. Sometimes this is easy to calculate, sometimes it is not. Issues such as sick leave, overtime and vacation time can complicate calculation of the proper AWW. Since your weekly TTD checks and your PPD settlement are based on your AWW, properly calculating your AWW is essential. Don’t just take the word of the insurance company as to what AWW to use. Contact us for a free evaluation to determine your proper AWW.

Once you have the correct AWW, to determine your workers’ compensation settlement, you must multiply your AWW times 60%. This is your PPD rate. You may recall when you were receiving your weekly TTD checks, your checks were 66.67% of your AWW. The Workers’ Compensation Act sets your TTD rate at 2/3 of your AWW and your PPD rate at 60% of your AWW. So, the first number in the equation to calculate your workers’ compensation settlement is 60% of your AWW.

What is your Percent of Permanent Disability?

The final factor which goes into the calculation of your workers’ compensation settlement is your percent of disability. A disability impairment can run from 0%-100%. In determining a percentage of impairment, the Workers’ Compensation Commission considers five factors:

  • Impairment report prepared by a physician using the most current edition of the American Medical Association’s “Guides to the Evaluation of Permanent Impairment”
  • The occupation of the injured employee
  • The age of the employee at the time of the injury
  • The employee’s future earning capacity
  • Evidence of disability corroborated by the treating medical records.

The relevance and weight of any of these factors must be explained by the arbitrator in coming to his or her decision on disability.

Because the percent of disability is used as a multiplier in calculating your PPD award, a higher percent disability will result in a higher PPD award. An experienced workers’ compensation lawyer will know how to get you the highest disability rating.

How a Workers Compensation Lawyer Can Help

Very rarely is a workers’ compensation settlement as simple as outlined above. Let’s face it, if it were, there would be no need for lawyers. Some people feel that they will receive more money if they handle their case themselves without having to pay for a lawyer. This is short-sighted. A good lawyer will get you more money even after the fee of 20%. McCready Law offers a free consultation to discuss workers’ compensation settlements.