When a Wisconsin workers’ compensation claim becomes litigated, employers may need to provide records, clarify job duties and return-to-work options, and coordinate with claims professionals and counsel. Resolution may involve medical evidence, settlement discussions, or a formal hearing.
Even organizations with mature safety programs and strong claims management practices will occasionally find themselves involved in a litigated workers’ compensation claim. When that happens, the focus shifts to understanding the dispute and supporting its resolution.
For many employers, litigation creates uncertainty. Leaders may worry about claim costs, employee relations, operational disruptions, and the potential impact on the organization. Others assume that once attorneys become involved, the claim is destined for a lengthy hearing process.
The reality is often much different.
Workers' compensation litigation is designed to resolve disputes. While the process can be complex, employers who understand how it works are better equipped to support their employees, collaborate with their claims partners, and make informed business decisions throughout the life of the claim.
Although this article focuses on Wisconsin, many of the principles discussed are common across workers’ compensation systems nationwide.
For the full series, read Understanding Workers’ Compensation Litigation.
One of the most common misconceptions about workers’ compensation litigation is that it begins when a hearing is scheduled.
In reality, litigation is often the culmination of issues that have been developing for months.
A disagreement regarding causation, medical treatment, work restrictions, or disability benefits may eventually require formal resolution. Attorney involvement frequently occurs well before any hearing request is filed, and significant work is often performed behind the scenes as parties attempt to evaluate and resolve disputed issues.
For employers, it is important to understand that litigation rarely changes the underlying objectives of the claim.
The goals remain the same:
Litigation simply provides a structured framework for accomplishing those goals when disagreements cannot otherwise be resolved.
Employer Tip
The fact that a claim becomes litigated does not necessarily mean the claim is being mishandled. Litigation is often a normal part of resolving complex claim issues.
Wisconsin provides informal and formal ways to address disputed claims. The appropriate route depends on the issues and the circumstances of the case; a claim does not necessarily pass through every option below.
Clarify the disagreement
Work with your claims professional and counsel to identify what is disputed and which records or medical opinions are needed.
Consider informal resolution
Discussion or an available informal dispute-resolution process may help the parties address a disagreement.
Prepare for a formal hearing
A disputed claim may proceed to a hearing before an administrative law judge. Ask counsel what records and employer participation are needed.
Evaluate resolution and review
A compromise agreement is submitted for approval. An administrative law judge’s order may be appealed to the Labor and Industry Review Commission.
See Wisconsin DWD’s disputed-claim resources and hearing, compromise, and appeal forms. Coordinate case-specific steps and deadlines with counsel.
When litigation begins, many employers assume responsibility shifts entirely to the insurance carrier, third-party administrator, or defense attorney.
While those partners assume a larger role in managing the legal aspects of the claim, the employer remains an important participant throughout the process.
Employers often possess critical information regarding:
Information Your Claims Partners May Need
The information maintained by the employer frequently becomes an important component of the overall claim strategy.
Employers should expect periodic requests for records, updates, and operational information as the claim progresses.
Employer Tip
The strongest claims outcomes often occur when employers, claims professionals, and legal counsel work as a coordinated team.
Medical evidence plays a central role in workers’ compensation litigation.
Questions frequently arise regarding:
Medical Questions That Can Drive Disputes
Medical providers may sometimes reach different conclusions based on the same facts.
For example, one physician may conclude that work activities significantly contributed to a condition, while another may attribute the same condition primarily to pre-existing factors.
These differences are not unusual.
As a result, medical records, provider opinions, treatment histories, and diagnostic findings often become central components of litigated claims.
For employers, this reinforces the importance of maintaining accurate documentation from the beginning of the claim. Clear records regarding job duties, injury circumstances, and return-to-work efforts can help medical providers better understand the workplace context surrounding the injury.
Employer Tip
Many litigation outcomes are driven by medical opinions. Providing accurate information early helps ensure those opinions are based on complete facts.
One of the most frequently misunderstood aspects of workers’ compensation litigation is the Independent Medical Examination, commonly referred to as an IME.
IMEs are often used when significant medical disputes arise.
Common issues addressed through an IME include:
Although employees sometimes view IMEs with skepticism, employers should recognize their intended purpose: providing an independent medical opinion regarding disputed issues.
An IME does not automatically determine the outcome of a claim.
It is simply one piece of evidence among many that may be considered as parties evaluate a dispute.
Some IMEs strongly support treating physician recommendations. Others may identify significant areas of disagreement. In most litigated claims, the value of the IME lies in helping stakeholders better understand the medical questions that need to be resolved.
Employer Tip
An IME should be viewed as a tool for evaluating disputed medical issues, not as a guaranteed solution to those disputes.
When employers hear the term "litigation," they often envision a courtroom trial.
Workers' compensation litigation generally functions differently.
Many claims are resolved through:
Formal hearings certainly occur when disputes cannot otherwise be resolved, but they represent only one stage within a broader dispute resolution process.
In many instances, the exchange of information itself helps narrow disagreements and move the parties toward resolution.
Understanding this distinction can help employers avoid unnecessary anxiety when a claim enters litigation.
Employer Tip
The presence of litigation does not necessarily mean a hearing is imminent. Many disputed claims are resolved before reaching that stage.
Some of the most challenging issues that arise during litigation are not medical in nature. They are employment-related.
As claims progress, employers may be required to make decisions regarding:
Employment Decisions to Coordinate Carefully
While these decisions may be entirely legitimate, they should be carefully evaluated within the broader context of the workers’ compensation claim.
Poorly timed or poorly documented employment actions can create additional disputes and complicate claim resolution efforts.
Employers should coordinate workforce decisions involving injured workers with HR, claims professionals, and appropriate counsel.
This principle applies well beyond Wisconsin. Across jurisdictions, coordination between HR, operational leadership, claims management, and legal counsel is often essential.
Employer Tip
Employment decisions and workers’ compensation decisions may be separate processes, but their consequences are often closely connected.
At some point during litigation, the possibility of settlement may arise.
Settlement discussions often occur when parties seek greater certainty regarding claim outcomes, future exposure, or ongoing administration.
Employers sometimes view settlement strictly through a financial lens. While cost is certainly important, effective settlements can also provide:
Not every claim is an appropriate settlement candidate, nor should settlement be viewed as an admission that a claim lacks merit.
Rather, settlement is often a strategic business decision made after considering the strengths, weaknesses, costs, and risks associated with continued litigation.
Employer Tip
The best settlement decisions balance legal considerations, financial factors, employee relations, and long-term organizational objectives.
One common mistake employers make is disengaging from employees once attorneys become involved.
While direct communications regarding disputed legal issues may require coordination with counsel or claims professionals, employers can still play an important role in maintaining appropriate workplace relationships.
Employees continue to notice:
Litigation changes certain aspects of communication, but it should not eliminate professionalism, empathy, or engagement.
In many cases, preserving positive relationships throughout litigation contributes to smoother claim resolution and more successful return-to-work outcomes.
Employer Tip
Litigation may change the process, but it should not change how employees are treated.
Workers' compensation litigation can feel intimidating, particularly for employers who encounter it infrequently. Yet litigation is not necessarily a sign of failure, conflict, or poor claim management.
More often, it is a structured process designed to resolve legitimate disagreements regarding medical, vocational, or benefit-related issues.
Employers who understand their role in that process are better positioned to contribute positively to claim outcomes. By partnering effectively with claims professionals and legal counsel, maintaining strong documentation, making thoughtful employment decisions, and continuing to support injured employees, organizations can make better-informed decisions throughout a complex claim.
Wisconsin's workers’ compensation system, like many systems across the country, is ultimately intended to balance the interests of employers and employees while providing an orderly mechanism for resolving disputes. Employers who approach litigation with preparation, patience, and collaboration are better prepared to provide the information and support needed to resolve disputed issues.
Key Takeaway:
Litigation is not the end of effective claims management. It is simply another phase of the claim lifecycle. Employers who understand the process and remain actively engaged can continue to influence outcomes, control costs, and support employee recovery all the way through resolution.