How to Settle Tough WC Cases - Insurance Thought Leadership

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June 14, 2017

How to Settle Tough WC Cases

Summary:

Many workers' comp cases are oh-so-close to settling but never get there. A "mediator's proposal" can try to bridge the gap, without risk.

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I see cases — sometimes years later — where the parties were oh-so-close to settling when negotiations broke down. Nobody would compromise their bargaining position to give that last inch, and they didn’t have a mediator to help them bridge the gap.
A Secret Response to an Offer Nobody Made
A “mediator’s proposal” works like this. I come up with a figure, sometimes with conditions such as CMS approval, which I believe will settle the case. Neither party has made this settlement offer, but, based on the negotiations so far, it is a figure I believe all parties can accept.

See also: ‘Twas the Night Before Mediation  

The mediator’s proposal depends on confidentiality. Parties are in separate rooms at this point. These separate sessions are called “caucuses.” I have always communicated my mediator’s proposals aloud in the caucus room, but some mediators write the proposal on two pieces of paper (one for each side) and sometimes put them in envelopes to be opened once the mediator has left the caucus.

If both parties accept the proposal, we have a settlement. (Hurray!) If one party accepts, but the other does not, there is no settlement, and the refusing party never learns that the other side accepted. I only tell parties there is no settlement. If both sides refuse, I tell them there is no settlement, but, again, parties do not know if the other side accepted the mediator’s proposal.

There are many benefits of the mediator’s proposal. Principally, no one has forsaken their last offer to settle. If a mediator’s proposal does not succeed, the parties can continue negotiating from their last position.

Blame It on the Mediator

The mediator’s proposal allows mediation participants to save face. “It wasn’t our idea; it was that darn mediator’s.” Sometimes attorneys hesitate to be completely forthright in their recommendations to their clients, particularly if they are the second or third attorney on the file. The mediator’s proposal opens the door for a frank discussion while allowing the attorney to shift responsibility to the mediator for an idea the client may find distasteful.

See also: The 1 Way to Maximize Success in Mediation  

Mediators don’t stick their necks out to come up with a proposal unless they are pretty sure it is going to be accepted. These things don’t happen early in the mediation. More likely, you will see a mediator’s proposal when it looks like parties are heading to an impasse. Because my mediator’s proposal is a reflection of the parties’ own negotiation to this point, it is generally accepted.

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About the Author

Teddy Snyder mediates workers’ compensation cases throughout California through WCMediator.com. An attorney since 1977, she has concentrated on claim settlement for more than 19 years. Her motto is, “Stop fooling around and just settle the case.”

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