What is CRU?
- CRU stands for the Compensation Recovery Unit. It is part of the Department for Work and Pensions.
- Its role is to recover certain state benefits and NHS costs that were paid because of an accident, injury or illness, where compensation is later paid.
- The basic idea is that a person should not be compensated twice for the same loss: once through state benefits and again through compensation from the Defendant.
- CRU makes sure that the Defendant repays the relevant benefits to the Government where the rules allow this.
When does CRU apply?
The Compensation Recovery Unit (CRU) can become relevant when compensation is awarded following a range of claims, including:
- personal injury claims;
- clinical negligence claims;
- industrial disease claims; and
- fatal accident claims.
CRU is generally concerned with benefits and other payments made as a result of the same injury, illness or condition for which compensation is being claimed.
Importantly, not every benefit is deducted from every type of compensation. The rules depend on the particular benefit received and the head of loss to which it relates. For example, some benefits may be taken into account when calculating past loss of earnings, while others may relate to past care or mobility costs.
There are also limits on the period for which benefits can be recovered through CRU. In clinical negligence claims, the relevant period will generally run from the date of the injury or disease to the end of the recovery period, subject to the statutory rules governing the particular claim.
This is particularly important in clinical negligence claims, which can take several years to investigate and resolve. The fact that a claimant has received benefits during the course of a claim does not, by itself, mean that all of those benefits will be deducted from their compensation. Your solicitor will consider the type of benefit, the period for which it was paid and the particular loss being claimed.
Which benefits can reduce compensation?
Certain state benefits received as a result of the injury or illness may be taken into account when calculating compensation for past loss of earnings. This is generally where the benefit was paid to meet the same need as the loss of earnings claimed.
The benefits which may be taken into account include:
- Universal Credit;
- Employment and Support Allowance;
- Incapacity Benefit;
- Income Support;
- Industrial Injuries Disablement Benefit (formerly referred to as Disablement Pension payable under section 103 of the Social Security Contributions and Benefits Act 1992);
- Invalidity Pension and Invalidity Allowance;
- Jobseeker's Allowance;
- Reduced Earnings Allowance;
- Severe Disablement Allowance;
- Sickness Benefit;
- Unemployability Supplement;
- Unemployment Benefit; and
- Statutory Sick Pay paid before 6 April 1994.
The rules are subject to the particular circumstances of the claim and the period for which the benefit was received. The Compensation Recovery Unit (CRU) will generally issue a certificate identifying relevant benefits which may be recoverable or capable of being offset against compensation.
Benefits are not deducted from compensation for future losses.
Can benefits be deducted from compensation for care?
Yes. Certain benefits may reduce the compensation you receive for past care, where the benefit was paid during the relevant period to meet the same need as the care being claimed.
These benefits include:
- Attendance Allowance;
- the care component of Disability Living Allowance (DLA);
- the living component of Personal Independence Payment (PIP);
- an Industrial Injuries Disablement Benefit increase for Constant Attendance Allowance; and
- Exceptionally Severe Disablement Allowance.
It is important not to assume that every benefit can be deducted from every type of past loss. Different benefits apply to different heads of compensation. Your solicitor will check which benefits are relevant to your particular claim.
Benefits that can be deducted from compensation for mobility
Certain benefits received because of your injury or illness may be taken into account when calculating compensation for past mobility expenses, where they were paid to meet the same need as the mobility costs being claimed.
These include:
- Mobility Allowance;
- the mobility component of Personal Independence Payment (PIP); and
- the mobility component of Disability Living Allowance (DLA).
Not every benefit will affect every type of compensation. Your solicitor will check which benefits are relevant to your particular claim.
How will CRU affect my compensation?
The Defendant will usually obtain a CRU certificate. This certificate may be updated during the claim. It confirms:
- which benefits have been paid;
- the dates those benefits cover; and
- the amount that may need to be repaid to the Government.
Your solicitor will check that the benefits listed on the certificate are connected to the injury or condition in your claim, that the dates are correct, and that the certificate is still valid.
Only benefits paid during the relevant period, usually up to five years from the date of injury, can normally be recovered through CRU.
When compensation is offered or agreed, the offer may be described as either “net of CRU” or “gross of CRU”. These terms affect how much money you will actually receive.
- Net of CRU means the Defendant will pay the recoverable benefits to the DWP separately. The amount offered to you should not be reduced because of CRU, so you should receive the amount being offered.
- Gross of CRU means the total offer includes the amount that may need to be repaid to the DWP. This means you may receive less than the headline figure. The Defendant should explain how the offer has been calculated and what reduction is being made for CRU.
What if I think my CRU certificate is wrong?
Your solicitor will check the CRU certificate carefully. If it includes benefits that do not relate to your claim, benefits paid for a different medical condition, or benefits you were already receiving before the negligence, your solicitor can ask for the certificate to be reviewed. In some cases, it may also be possible to appeal the certificate after compensation has been paid.
The important thing to remember
Receiving state benefits does not mean that you will automatically have money taken from your compensation.
CRU is a technical area of the law. Your solicitor will check what benefits are relevant, the period for which they were paid and how they relate to the losses you are claiming. They will also check that any CRU deduction has been calculated correctly before your claim is settled.
Sarah Grogan, Legal Director and specialist medical negligence solicitor at MDS, said: “CRU can be confusing, and some claimants are understandably concerned when they hear that deductions may be made from their compensation. Understanding how benefit recovery works helps claimants see how their settlement has been calculated and ensures the right outcome is achieved.”
