Understanding Workers' Compensation Pay in Minnesota
In a Minnesota workers’ compensation case, the Average Weekly Wage (AWW) is used to determine a fair amount of compensation for any potential loss of future earnings resulting from a work-related injury.
- Temporary total disability benefits are paid at two-thirds of your AWW.
- Temporary partial disability benefits are paid at two-thirds of the difference of your AWW and gross earnings each week/pay period.
- Benefits are subject to minimum/maximum amounts based on statewide AWW.
The statewide average weekly wage is adjusted in October each year. As of October 1, 2023, the statewide AWW in Minnesota is $1,337 with the maximum weekly benefit being $1,363.74 and the minimum weekly benefit being $272.75.
What's Included in the AWW Calculation?
- Regular or frequent overtime
- Tips and gratuities
- Paid time off (e.g., sick, vacation, holiday, etc.)
- Performance-based bonuses
- Room and board and/or other allowances
Moreover, if you had another job at the time of the injury, the lost earnings from that second employer will also be factored into the overall compensation.
What’s Not Included in the AWW Calculation?
- Pension and Profit sharing
- Employer contributions to health, dental, and life insurance benefits
AWW Calculations for Injured Workers
If you cannot work due to a work injury or earn less than your full wages because of it, you may be eligible for wage loss benefits. Your AWW determines these benefits, so it’s crucial to avoid any mistakes that could affect the amount you receive.
Here is how to calculate your AWW based on your employment status at the time of the injury:
Full-Time, Regularly Scheduled
The average weekly wage in these cases is typically calculated by adding your total gross earnings for the 26 weeks before the date of injury and dividing that amount by 26 weeks.
Part-Time or Irregularly Scheduled
The average weekly wage in these cases is determined by calculating the Average Daily Wage (ADW). You can find this amount by adding the total gross earnings during the 26 weeks before the injury. Next, you’ll need to:
- 1: Count the total # of days worked during that period, including PTO.
- 2: Divide the total gross earnings by the # of days worked.
- 3: Divide the days worked by the weeks worked.
- 4: Multiply the ADW by the average # of days worked/per week.
For example, if an employee earns an average of $100 per day and works an average of 2 days per week, the average weekly wage is $200.00.
AWW for Special Employement
There are various types of unique employment situations, such as unpaid positions, jobs that pay with credits for schooling, or seasonal work. In these scenarios, employees may not be classified as full-time or part-time. Here’s how to calculate your AWW for the following special employment situations:
- Volunteers: Many uncompensated volunteers are not covered by workers’ compensation law. For the minority of volunteers covered, the AWW is based on the usual wage for paid employees performing similar services.
- Apprentices: Injured workers in state-approved apprenticeship programs can receive wages at a special apprentice rate.
- Self-Employment: Self-employment wages are difficult to calculate. Business profit and loss data and tax returns may provide essential information in determining the average weekly wage.
- Seasonal Employees: For injured workers whose hours are affected by seasonal conditions, such as those in mining, construction, or other injuries, the wage is never less than 5X the daily wage as calculated above.
- Piece-Rate Employees: Full-time, regularly scheduled piece-rate employees’ wages are typically calculated by dividing the total gross earnings over the 26 weeks before the injury by the number of hours worked. Next, multiply the hours the injured worker was hired to work by the average hourly wage.
Why Getting It Right Matters for Your Case
In a workers’ compensation case, if the calculation of your AWW is incorrect, it can significantly impact the amount of wage loss benefits received. Wage loss is crucial in a workers’ compensation claim as it helps to determine the extent of financial damages suffered by the injured worker. Simply put, your wage loss directly affects the compensation you’ll be entitled to receive.
Workers who cannot perform their job requirements after sustaining an injury at work may be eligible for temporary or permanent disability benefits, calculated based on the wage loss. Additionally, wage loss can also be used to measure the injury’s severity and the length of time it may take for the worker to recover and return to work.
Overall, the importance of wage loss in a workers’ compensation case cannot be overstated, as it plays a significant role in determining fair compensation.
Have Questions About Workers' Compensation Calculations?
If you have any concerns about your entitlement to benefits based on your AWW, we strongly recommend you reach out to Meshbesher & Spence today! With our years of experience and successful track record of supporting Minnesotans, we’ll help you navigate the complicated and difficult process following a work injury.