NC Court of Appeals Rejects Workers’ Compensation Settlement Agreement

In Kee v. Caromont Health, Inc., the North Carolina Court of Appeals upheld the Industrial Commission’s rejection of a compromise settlement agreement.  The agreement originally reached by the parties involved the defendants paying plaintiff $20,000, the plaintiff resigning from her employment, and the plaintiff releasing all of her employment rights.  After plaintiff refused to sign the finalized version of the settlement agreement, the defendants tried to enforce the original agreement.

The Court and Industrial Commission both found the settlement agreement unenforceable.  Industrial Commission Rule 502 requires that in a workers’ compensation settlement, “no rights other than those arising under the provisions of the Workers’ Compensation Act are compromised or released.”  The agreement must also include that specific language.  Because the instant agreement involved the waiver of rights beyond workers’ compensation, and did not include the required language, it could not be enforced.