In North Carolina, if a party to a workers’ compensation case, such as an injured worker or an employer/insurance company, has requested a hearing in front of the North Carolina Industrial Commission by filing a Form 33, a mediation is required by state law. However, if an agreement or settlement is reached by all parties before the mediation, the mediation is not necessary. Sometimes, the parties agree to an informal mediation between themselves.
The purpose of the mediation is for the parties to come together, with the assistance of an approved mediator, and try to settle the matter without the cost and expense of a formal hearing in front of a deputy commissioner, who is similar to a judge.
The mediation is usually in one of the attorney’s offices. Unless waived by the parties, all interested persons must attend the mediation. The mediation is usually held in the county where the injury occurred. The mediator’s responsibility is to try to assist the parties to come to a compromised agreement between themselves that would “settle” the case. The mediator is usually an attorney with years of experience mediating cases. The mediator is an unbiased attorney who works for neither side and has no stake in the outcome of the case. The mediator is usually paid on an hourly basis. Currently the hourly rate for a mediator is usually $125-350 per hour.
One main purpose of the mediation is to determine through mediation what final settlement amount (known as a “clincher”) is to be paid to the injured worker as a full and final settlement of the claim. The clincher is usually the goal of both parties. The mediation’s main purpose is to determine what that clincher dollar amount will be.
The mediation usually begins with the mediator bringing the injured worker, their attorney, and the employer/insurance company and their attorney into a room to discuss the merits of each party’s claim. The attorney for the injured worker gives a small presentation about the injury and the medical cost, etc. Usually if the employer’s insurance company has accepted the injured worker’s claim, the exact medical cost and disability rating is an accepted fact by all parties. Usually the medical cost has already been paid by the employer’s insurance company.
Next, the employer’s attorney will make a small statement about the injuries to the worker. The “compensation rate” of the employee is usually agreed to by the parties.
The mediator will divide the parties into separate rooms. The mediator will go into each room and discuss the merits and weaknesses of each party’s case. Usually the injured worker will make the first initial dollar amount offer to “clinch” or settle the case. The mediator will usually take this offer to the employer/insurance company for consideration. This amount is usually more that the employer is willing to pay. The employer will counter with a lower offer. The mediator will present this offer to the injured worker. No surprise, this amount is usually lower than the injured worker is willing to accept. The mediator goes back and forth between the parties, adjusting the dollar amounts each party is willing to accept. This may take several hours or several days.
Hopefully, each party will finally agree to a mutual dollar amount, somewhere in the middle, that each party can accept. It is normal for both parties to feel they have been treated unfairly and are paying too much or not being paid enough. The goal of mediation is to settle the matter. Neither party will walk away completely happy, but both parties are usually concerned that if they do not settle the case during mediation, then they may do far worse at a hearing. As the old saying goes, “a bird in the hand is worth two in the bush.”
Most mediations end with a clincher. In the event the parties cannot come to a settlement at mediation, the mediator will declare an “impasse.” At this time, unless the parties can come to a settlement later, a hearing will be scheduled before a deputy commissioner. This is similar to a court trial. The deputy commissioner will make a decision on the merits of the case.