Minnesota workers compensation laws limit fees for attorneys that represent injured workers. Workers compensation attorneys do not charge for the initial consultation. They do not charge an upfront payment.

Minnesota workers comp attorneys work on a contingent fee. They only charge a fee if they recover benefits for the employee. The law limits attorney fees to 20% of benefits recovered.

Monitoring Admitted Claims

Injured workers often retain an attorney before the insurer denies any benefits. The attorney will then “monitor” the workers comp case. If the insurance company voluntarily pays the workers compensation claim, then there is no attorney fee.

In Minnesota, attorneys representing employees in workers compensation cases do not charge a fee unless and until:

1)     The insurer denies workers comp benefits; and

2)     The attorney recovers those benefits.

Unfortunately, insurance companies often improperly refuse to pay workers comp claims. The attorney will presumably take legal action to recover those benefits for the employee. There are three ways to win your case:

1)     Settlement;

2)     Court order; and

3)     Capitulation (the insurer changes its mind and pays).

The law firm will not charge a fee until the insurer has made the payment.

Wage Loss, Permanent Partial Disability, and Lump Sum Settlements

Wage loss benefits, permanent partial disability benefits, and settlements are all payments to the injured employee. Attorney fees are limited to 20% of those amounts. When the insurance company makes the payment, it will withhold 20% for attorney fees and pay the rest to the employee.

Example:

• Employee John has a workplace injury. His doctor tells him not to return to work until his condition improves.

• Mega Insurance Company starts paying Employee John $1,000 per week for wage loss.

• Mega Insurance Company claims that the injury healed and stops making the weekly payment. Employee John hires Lawyer Lyle, who requests an administrative conference.

• After the administrative conference, the compensation judge orders Mega Insurance Company to keep paying weekly benefits.

• Mega Insurance Company will now pay $800 each week to Employee John and set aside $200 each week for attorney fees.

Partial Reimbursement of Attorney Fees

The workers comp system allows employees to seek reimbursement for some of their attorney fees. It is common practice for insurance companies to ask employees to waive this right as part of settlement. For that reason, employees usually only get reimbursed after they recover benefits by court order. The employee can request reimbursement for 30% of attorney fees over $250.

Example:

• A compensation judge orders Mega Insurance Company to pay Employee John $11,250 in permanent partial disability benefits.

• Mega Insurance Company sends a check to Employee John for $9,000 and withholds $2,250 for attorney fees.

• Lawyer Lyle files a request for Mega Insurance Company to pay Employee John another $600 reimbursement of attorney fees.

Medical Benefits and Rehabilitation Benefits

Workers compensation insurance companies must pay for medical treatment and rehabilitation benefits. Insurers make those payments to the rehabilitation and healthcare providers, not to the employee.

Injured workers often hire attorneys to get medical bills paid. The attorney can bring a claim for attorney fees against the insurance company. If the claim is only for medical bills, then the employee does not pay an attorney fee at all.

If the claim is for medical bills and wage loss benefits, then the employee only pays the 20% fee from the wage loss benefits.

Conclusion

There is no upfront cost to retain a workers compensation lawyer. If the insurance company never denies any benefits and the case is not settled, then there is no attorney fee at all. If the claim is only for medical bills, then the employee does not pay an attorney fee at all. If the attorney recovers benefits paid to the employee, then the attorney fee is 20% of the payment.

LawSmith PLLC offers a free consultation to Minnesota injured workers.

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