How Does Workers' Comp Work in Minnesota?

Minnesota workers' comp pays three main things. The insurer covers medical care that is reasonably required for the work injury, replaces two-thirds of your lost wages up to a statewide cap, and later pays a separate permanency benefit if a doctor assigns a rating. The insurer's first calculation isn't always right, so this page walks through each formula, the statute behind it, and where you can run the numbers yourself.

For the current dollar caps, use the Minnesota work comp rates table. For first-payment timing, see when work comp has to start paying. If you have a specific question, consider talking to a workers' comp attorney about your situation.

Your average weekly wage (AWW)

Every wage-loss calculation in Minnesota workers' comp starts with your average weekly wage, or AWW. Under Minn. Stat. § 176.011, subd. 18, it's usually based on your earnings during the 26 weeks before the date of injury: add up your gross wages for those weeks and divide by the number of weeks you actually worked.

The statute handles the less tidy situations too. If you held more than one job at the time of injury, wages from all employers may be combined. If your work was irregular or seasonal, the calculation may use a longer lookback or an alternative method to produce a fair approximation of your earning capacity. And certain fringe benefits, like employer health insurance contributions, can be included in AWW under specific circumstances.

Every other wage-loss number flows from this figure, so it's worth getting right. The AWW calculator will compute yours from your wages.

Temporary total disability (TTD)

TTD is the weekly check for workers who cannot work at all because of their injury. Under Minn. Stat. § 176.101, subd. 1, the rate is two-thirds of your AWW, subject to a statewide maximum and minimum.

If two-thirds of your AWW is above the statutory maximum, you receive the maximum. That cap changes every October 1 based on the Statewide Average Weekly Wage (SAWW) published by the Department of Labor and Industry (DLI). If two-thirds of your AWW is below the statutory minimum, you receive the minimum or your full AWW, whichever is less. The max and min that apply to your claim come from your date of injury, not the date payments start. TTD benefits are generally not subject to state or federal income tax.

Here's an example. If your AWW is $1,200 and the maximum for your date of injury is $1,259.28, then two-thirds of $1,200 is $800. That's below the cap, so your TTD rate is $800 a week.

The TTD calculator computes your exact rate for any date of injury.

Temporary partial disability (TPD)

TPD is the wage-loss benefit for workers who can work but earn less because of their injury, such as part-time hours or a lower-paying light-duty job. Under Minn. Stat. § 176.101, subd. 2, the rate is two-thirds of the difference between your AWW and your current weekly earnings.

TPD is subject to the same statewide caps as TTD. If your earnings change week to week, which is common on light duty, the TPD amount changes with them. The math also builds in an incentive: because you keep your paycheck plus two-thirds of the wage gap, returning to partial work within your restrictions always leaves you with more money than staying home on TTD.

The TPD calculator shows what you'd receive at different earning levels.

Permanent partial disability (PPD)

PPD works differently from TTD and TPD. It isn't based on lost wages at all. It compensates you for permanent functional loss to a body part, and you can receive it even if you're back at full pay.

PPD is governed by Minn. R. 5223, the Minnesota Disability Schedule. After you reach maximum medical improvement (MMI), your treating doctor or an IME doctor rates your permanent impairment as a percentage. Rule 5223 assigns each body part and impairment level a specific number of weeks of compensation, so a 10% rating of the whole body converts differently than a 10% rating of a shoulder. Those weeks are then multiplied by a per-week dollar amount set by statute, which also depends on your date of injury. PPD is usually paid as a lump sum once the rating is established and accepted.

If more than one body part is rated, the ratings are combined under a statutory formula, not simple addition. Certain conditions are rated on a Weber basis, which converts a whole-body percentage to an equivalent schedule-based value.

The PPD calculator looks up the schedule value for your body part and rating. The PPD rules by body part list the Minnesota Rule 5223 categories for the lumbar spine, shoulder, wrist, knee, and other published parts.

Permanent total disability (PTD)

PTD applies when your injury permanently and totally prevents you from working in any capacity for which there is a reasonably stable labor market. Under Minn. Stat. § 176.101, subd. 4, the weekly rate is the same formula as TTD, two-thirds of AWW subject to the same max and min. The difference is duration: PTD continues for as long as the disability lasts, which can be the rest of your life.

PTD is relatively rare and almost always contested by insurers. Establishing it typically takes a strong medical foundation showing you cannot perform any suitable work, vocational evidence (often a vocational expert opinion) that no jobs are available within your restrictions, and usually a hearing before a compensation judge at the Office of Administrative Hearings (OAH).

Death and dependency benefits

When a work injury results in death, Minnesota provides benefits to the worker's dependents under Minn. Stat. § 176.111. A wholly dependent spouse receives weekly benefits similar in structure to TTD or PTD, and dependent children may receive additional benefits. Burial expenses are covered up to a statutory limit. If the worker had no dependents, the employer and insurer pay a lesser amount to a special state fund.

The exact amounts and durations depend on the date of injury and the dependency status of the survivors. These cases are complex and almost always require legal representation.

How the benefits fit together

Not every injured worker receives every benefit. A typical claim moves through them in order. The injury sets your AWW. While you're off work entirely, TTD pays two-thirds of it. When you return to light duty at reduced pay, TTD stops and TPD pays two-thirds of the gap. At MMI, a doctor assigns a permanency rating and PPD is paid as a lump sum. Once you're back at full wages, the wage-loss checks end, but PPD is unaffected. If you can never return to any work, PTD may apply instead, as an ongoing two-thirds of AWW.

The transition points, especially between TTD and TPD and around the timing of MMI, are where disputes most commonly arise.

Where calculations go wrong

Benefit calculations are not always done correctly. The most common errors:

• The AWW is computed from the wrong period. The insurer should use the 26 weeks before the injury, not a shorter or different window.
• Fringe benefits are left out. If your employer paid for health insurance or other qualifying benefits, those may increase your AWW.
• The wrong year's max or min is applied. The cap comes from your date of injury, not the date of payment.
• The PPD schedule lookup is off. Body part categorization and the percentage-to-weeks conversion must follow Rule 5223 precisely.
• A second job is ignored. If you held two jobs at the time of injury, wages from both should be included in your AWW.

If something looks wrong, run the numbers yourself using the calculators on this site, and consider getting legal advice.

Statutes and rules referenced

• Minn. Stat. § 176.011, subd. 18: definition of Average Weekly Wage
• Minn. Stat. § 176.101: TTD, TPD, and PTD formulas
• Minn. Stat. § 176.111: death and dependency benefits
• Minn. R. 5223: Permanent Partial Disability Schedule