MN Statute 176.081 – Workers’ Compensation Attorney Fees Explained

This page provides the complete text of Minnesota Statute 176.081, which outlines attorney fees, legal services, and related procedures in workers’ compensation cases. We are sharing this statute to give you direct access to the official language of the law, helping you understand how attorney compensation is determined, the limits on fees, and your rights under Minnesota workers’ compensation rules.

This information is reproduced from the State of Minnesota’s official publication and is provided for informational purposes only. It is not legal advice. For questions about how this law applies to your case, please consult with a qualified workers’ compensation attorney.

176.081 LEGAL SERVICES OR DISBURSEMENTS; LIEN; REVIEW.

§ Subdivision 1. Limitation of fees.

(a) A fee for legal services of 20 percent of the first $275,000 of compensation awarded to the employee is the maximum permissible fee and does not require approval by the commissioner, compensation judge, or any other party. All fees, including fees for obtaining medical or rehabilitation benefits, must be calculated according to the formula under this subdivision, except as otherwise provided in clause (1) or (2).

(1) The contingent attorney fee for recovery of monetary benefits according to the formula in this section is presumed to be adequate to cover recovery of medical and rehabilitation benefit or services concurrently in dispute. Attorney fees for recovery of medical or rehabilitation benefits or services shall be assessed against the employer or insurer only if the attorney establishes that the contingent fee is inadequate to reasonably compensate the attorney for representing the employee in the medical or rehabilitation dispute. In cases where the contingent fee is inadequate the employer or insurer is liable for attorney fees based on the formula in this subdivision or in clause (2).

For the purposes of applying the formula where the employer or insurer is liable for attorney fees, the amount of compensation awarded for obtaining disputed medical and rehabilitation benefits under sections 176.102, 176.135, and 176.136 shall be the dollar value of the medical or rehabilitation benefit awarded, where ascertainable.

(2) The maximum attorney fee for obtaining a change of doctor or qualified rehabilitation consultant, or any other disputed medical or rehabilitation benefit for which a dollar value is not reasonably ascertainable, is the amount charged in hourly fees for the representation or $500, whichever is less, to be paid by the employer or insurer.

(3) The fees for obtaining disputed medical or rehabilitation benefits are included in the $55,000 limit in paragraph (b). An attorney must concurrently file all outstanding disputed issues. An attorney is not entitled to attorney fees for representation in any issue which could reasonably have been addressed during the pendency of other issues for the same injury.

(b) All fees for legal services related to the same injury are cumulative and may not exceed $55,000. If multiple injuries are the subject of a dispute, the commissioner, compensation judge, or court of appeals shall specify the attorney fee attributable to each injury.

(c) If the employer or the insurer or the defendant is given written notice of claims for legal services or disbursements, the claim shall be a lien against the amount paid or payable as compensation. Subject to the foregoing maximum amount for attorney fees, up to 20 percent of the first $275,000 of periodic compensation awarded to the employee may be withheld from the periodic payments for attorney fees or disbursements if the payor of the funds clearly indicates on the check or draft issued to the employee for payment the purpose of the withholding, the name of the attorney, the amount withheld, and the gross amount of the compensation payment before withholding.

In no case shall fees be calculated on the basis of any undisputed portion of compensation awards. Allowable fees under this chapter shall be available to an attorney who procures a benefit on behalf of the employee and be based solely upon genuinely disputed claims or portions of claims, including disputes related to the payment of rehabilitation benefits or to other aspects of a rehabilitation plan. The existence of a dispute is dependent upon a disagreement after the employer or insurer has had adequate time and information to take a position on liability.

In cases of nonemergency surgery, if the employer or insurer has requested a second opinion under section 176.135, subdivision 1a, or an examination under section 176.155, subdivision 1, a dispute shall be certified if 45 days have passed following a written request for an examination or second opinion and the conditions in clauses (1) to (3) have been met.

§ Subd. 2.

[Repealed, 1995 c 231 art 2 s 110]

§ Subd. 3. Review.

A party that is dissatisfied with attorney fees awarded by the commissioner or a compensation judge may file a petition for review by the Workers’ Compensation Court of Appeals. The petition shall state the basis for the need of review and whether or not a hearing is requested. A copy of the petition shall be served by the court upon the attorney awarded or denied attorney fees.

§ Subd. 6. Rules.

The commissioner, Office of Administrative Hearings, and the Workers’ Compensation Court of Appeals may adopt reasonable and proper joint rules to effect each of their obligations under this section.

§ Subd. 7. Award; additional amount.

If the employer or insurer files a denial of liability, notice of discontinuance, or fails to make payment of compensation or medical expenses within the statutory period after notice of injury or occupational disease, or otherwise unsuccessfully resists the payment of compensation or medical expenses, or unsuccessfully disputes the payment of rehabilitation benefits or other aspects of a rehabilitation plan, and the injured person has employed an attorney at law who successfully procures payment on behalf of the employee, the compensation judge, commissioner, or the Workers’ Compensation Court of Appeals upon appeal shall award an additional amount equal to 30 percent of the portion of the attorney’s fee exceeding $250.

§ Subd. 9. Retainer agreement.

An attorney hired by an employee must prepare a written retainer agreement outlining the provisions of this section and provide a signed copy to the employee. A signed agreement raises a conclusive presumption that the employee understands the statutory fee provisions. No fee shall be awarded in the absence of a signed retainer agreement.

Notice of Maximum Fee

The maximum fee allowed by law for legal services is 20 percent of the first $130,000 of compensation awarded to the employee, subject to a cumulative maximum fee of $26,000 for fees related to the same injury.

§ Subd. 10. Violation; penalty.

An attorney who knowingly violates any of the provisions of this chapter with respect to authorized fees for legal services in connection with any demand made or proceeding brought under this chapter is guilty of a gross misdemeanor.

§ Subd. 11. When fees due.

Attorney fees and other disbursements for a proceeding under this chapter shall not be due or paid until the issue for which the fee or disbursement was incurred has been resolved.

§ Subd. 12. Sanctions; failure to prepare, appear, or participate.

If a party or attorney fails to appear at a scheduled hearing, is unprepared, or fails to participate in good faith, the commissioner or judge may order that party to pay reasonable expenses and attorney fees incurred by the other party.

History

1953 c 755 s 8; 1973 c 388 s 16; 1975 c 271 s 6; 1975 c 359 s 7; 1976 c 134 s 78; 1977 c 342 s 7-11; Ex1979 c 3 s 32; 1981 c 346 s 67-74; 1983 c 290 s 36-41; 1986 c 444; 1986 c 461 s 7; 1987 c 332 s 13; 1989 c 209 art 2 s 23; 1992 c 510 art 2 s 1-3; 1995 c 231 art 2 s 45-49; 1997 c 7 art 1 s 80; 2000 c 447 s 9; 2005 c 90 s 3; 2013 c 70 art 2 s 3,4; 2014 c 275 art 1 s 34; 2016 c 110 art 1 s 1,2; 2023 c 51 art 2 s 1; 2024 c 97 s 4

NOTE: The parts of section 176.081 regulating attorney fees without permitting review by the court were found unconstitutional in
Irwin v. Surdyks Liquor, 599 N.W.2d 132 (Minn. 1999).

Official Publication of the State of Minnesota
Revisor of Statutes

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