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Previous studies have demonstrated varying correlations between Workers' Compensation status and the outcome of rotator cuff repair. However, none of those studies have formally accounted for potential confounding factors with multivariable analysis. We hypothesized that patients with Workers' Compensation claims who undergo rotator cuff repair have worse outcomes, even after controlling for confounding factors.One hundred and twenty-five patients (including thirty-nine with Workers' Compensation claims) who underwent unilateral primary repair of a chronic rotator cuff tear by a single surgeon were studied prospectively and were evaluated one year postoperatively, prior to the settlement of any claims. Outcomes were assessed with the Simple Shoulder Test (SST); the Disabilities of the Arm, Shoulder and Hand (DASH) index; three visual analog scales (shoulder pain, shoulder function, and quality of life); and the Short Form-36 (SF-36).Patients in the Workers' Compensation group were significantly younger, had greater work demands, and had lower marital rates, education levels, and preoperative expectations for the outcome of treatment as compared with those in the non-Workers' Compensation group (p = 0.001 to 0.016). Preoperatively, patients in the Workers' Compensation group had significantly lower scores on the SST, the SF-36 Physical Function scale, and the SF-36 Social Function scale (p = 0.01 to 0.038). One year postoperatively, those patients reported worse performance on the SST, the DASH, all three visual analog scales, and the SF-36 (p = 0.0007 to 0.05) and had worse improvement on the DASH, the visual analog scales for shoulder pain and function, and the SF-36 Bodily Pain and Role Emotional scales (p = 0.0028 to 0.038). Multivariable analysis controlling for age, sex, comorbidities, smoking, marital status, education, duration of symptoms, work demands, expectations, and tear size confirmed that Workers' Compensation status was an independent predictor of worse DASH scores.Patients with Workers' Compensation claims report worse outcomes, even after controlling for confounding factors. The present study provides further evidence that the existence of a Workers' Compensation claim portends a less robust outcome following rotator cuff repair.Prognostic Level I. See Instructions to Authors for a complete description of levels of evidence.