Workers' Compensation Advisory Council 2026 recommendations adopted.

A bill for an act

relating to workers' compensation; adopting 2026 recommendations of the Workers'

Compensation Advisory Council; amending Minnesota Statutes 2024, sections

79.34, subdivisions 3, 4; 79.35; 79.36; 79.362; 79.38, subdivision 1; 175A.05, by

adding a subdivision; 176.011, subdivision 15; 176.081, subdivision 9; 176.101,

subdivision 2a; 176.155, subdivision 1; 176.221, subdivision 1; 176.322; repealing

Minnesota Statutes 2024, sections 79.34, subdivision 2a; 79.361; 79.363.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 79.34, subdivision 3, is amended to read:

Subd. 3.

Withdrawal from association.

An insurer may withdraw from the reinsurance

association only upon ceasing to be authorized by license issued by the commissioner of

commerce to transact workers' compensation insurance in this state and when all workers'

compensation insurance policies issued by such insurer have expired; a self-insurer may

withdraw from the reinsurance association only upon ceasing to be approved to self-insure

workers' compensation liability in this state pursuant to section
176.181
.

An insurer or self-insurer which withdraws or whose membership in the reinsurance

association is terminated shall continue to be bound by the plan of operation. Upon

withdrawal or termination, all unpaid premiums which have been charged to the withdrawing

or terminated member
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and any other outstanding amounts owed
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shall be payable as of the

effective date of the withdrawal or termination.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 2.

Minnesota Statutes 2024, section 79.34, subdivision 4, is amended to read:

Subd. 4.

Liabilities of insolvent members.

An unsatisfied net liability to the reinsurance

association of an insolvent member shall be
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assumed by and apportioned among the

remaining members of the reinsurance association as provided in the plan of operation
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governed by the plan of operation effective at the time a member is declared insolvent by

a state regulatory authority or a court of competent jurisdiction, whichever comes earlier
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.

The reinsurance association shall have all rights allowed by law on behalf of the remaining

members against the estate or funds of the insolvent member for sums due the reinsurance

association.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 3.

Minnesota Statutes 2024, section 79.35, is amended to read:

79.35 DUTIES; RESPONSIBILITIES; POWERS.

The reinsurance association shall do the following on behalf of its members:

(1) assume 100 percent of the liability as provided in section
79.34
;

(2) establish procedures by which members shall promptly report to the reinsurance

association each claim which, on the basis of the injury sustained, may reasonably be

anticipated to involve liability to the reinsurance association if the member is held liable

under chapter 176. Solely for the purpose of reporting claims, the member shall in all

instances consider itself legally liable for the injury. The member shall advise the reinsurance

association of subsequent developments likely to materially affect the interest of the

reinsurance association in the claim;

(3) maintain relevant loss and expense data relative to all liabilities of the reinsurance

association and require each member to furnish statistics in connection with liabilities of

the reinsurance association at the times and in the form and detail as may be required by

the plan of operation;

(4) calculate and charge to members a total premium sufficient to cover the expected

liability which the reinsurance association will incur, together with incurred or estimated

to be incurred operating and administrative expenses for the period to which this premium

applies. Each member shall be charged a premium established by the board as sufficient to

cover the reinsurance association's incurred liabilities and expenses in excess of the member's

selected retention limit. Each member shall be charged a proportion of the total premium

calculated for its selected retention limit in an amount equal to its proportion of the exposure

base of all members during the period to which the reinsurance association premium will

apply. The exposure base shall be determined by the board and is subject to the approval

of the commissioner of labor and industry. In determining the exposure base, the board shall

consider, among other things, equity, administrative convenience, records maintained by

members, amenability to audit, and degree of risk refinement.
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Each member shall also be

charged a premium determined by the board to equitably distribute excess or deficient

premiums from previous periods including any excess or deficient premiums resulting from

a retroactive change in the prefunded limit.
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The premiums charged to members shall not

be unfairly discriminatory as defined in section
79.074
. All premiums shall be approved by

the commissioner of labor and industry;

(5) require and accept the payment of premiums from members of the reinsurance

association;

(6) receive and distribute all sums required by the operation of the reinsurance association;

(7) establish procedures for reviewing claims procedures and practices of members of

the reinsurance association. If the claims procedures or practices of a member are considered

inadequate to properly service the liabilities of the reinsurance association, the reinsurance

association may undertake, or may contract with another person, including another member,

to adjust or assist in the adjustment of claims which create a potential liability to the

association. The reinsurance association may charge the cost of the adjustment under this

paragraph to the member, except that any penalties or interest incurred under sections

176.183
,
176.221
,
176.225
, and
176.82
as a result of actions by the reinsurance association

after it has undertaken adjustment of the claim shall not be charged to the member but shall

be included in the ultimate loss and listed as a separate item;
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and
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(8) provide each member of the reinsurance association with an annual report of the

operations of the reinsurance association in a form the board of directors may specify
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.
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;
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(9) equitably distribute excess or deficient premiums from previous periods to members

based on amounts determined by the board. All excess or deficient premiums shall be

approved by the commissioner of labor and industry;

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(10) distribute excess surplus as recommended by the board and approved by order of

the commissioner of labor and industry consistent with section 79.362; and

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(11) collect deficiency assessments as recommended by the board and approved by order

of the commissioner of commerce consistent with section 79.362.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 4.

Minnesota Statutes 2024, section 79.36, is amended to read:

79.36 ADDITIONAL POWERS.

In addition to the powers granted in section
79.35
, the reinsurance association may do

the following:

(1) sue and be sued. A judgment against the reinsurance association shall not create any

direct liability against the individual members of the reinsurance association. The reinsurance

association shall provide in the plan of operation for the indemnification, to the extent

provided in the plan of operation, of the members, members of the board of directors of the

reinsurance association, and officers, employees and other persons lawfully acting on behalf

of the reinsurance association;

(2) reinsure all or any portion of its potential liability
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, including potential liability in

excess of the prefunded limit,
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with reinsurers licensed to transact insurance in this state or

otherwise approved by the commissioner of labor and industry;

(3) provide for appropriate housing, equipment, and personnel as may be necessary to

assure the efficient operation of the reinsurance association;

(4) contract for goods and services, including but not limited to independent claims

management, actuarial, investment, and legal services from others within or without this

state to assure the efficient operation of the reinsurance association;

(5) adopt operating rules, consistent with the plan of operation, for the administration

of the reinsurance association, enforce those operating rules, and delegate authority as

necessary to assure the proper administration and operation of the reinsurance association;

(6) intervene in or prosecute at any time, including but not limited to intervention or

prosecution as subrogee to the member's rights in a third-party action, any proceeding under

this chapter or chapter 176 in which liability of the reinsurance association may, in the

opinion of the board of directors of the reinsurance association or its designee, be established,

or the reinsurance association affected in any other way;

(7) the net proceeds derived from intervention or prosecution of any subrogation interest,

or other recovery, shall first be used to reimburse the reinsurance association for amounts

paid or payable pursuant to this chapter, together with any expenses of recovery, including

attorney's fees, and any excess shall be paid to the member or other person entitled thereto,

as determined by the board of directors of the reinsurance association, unless otherwise

ordered by a court;

(8) hear and determine complaints of a company or other interested party concerning

the operation of the reinsurance association; and

(9) perform other acts not specifically enumerated in this section which are necessary

or proper to accomplish the purposes of the reinsurance association and which are not

inconsistent with sections
79.34
to
79.40
or the plan of operation.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 5.

Minnesota Statutes 2024, section 79.362, is amended to read:

79.362 WORKERS' COMPENSATION REINSURANCE ASSOCIATION EXCESS

SURPLUS DISTRIBUTION
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OR DEFICIENCY ASSESSMENT
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.

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Subdivision 1.

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Scope.

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This section governs excess surplus distributions and deficiency

assessment of the reinsurance association. An excess surplus distribution is not a distribution

of excess premiums to members. The reinsurance association may not distribute excess

surplus or assess members due to a deficiency except as provided for in this section. For

purposes of this section, "insured employers" includes employers insured by insurer members

and employers insured by the assigned risk plan.

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Subd. 2.

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Declaration of distribution or assessment.

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(a) The board may declare an

excess surplus distribution to self-insurer members and insured employers. The board shall

determine the amount of excess surplus and set a timeline, a distribution rate for self-insurer

members, and a distribution rate for insured employers as applied to the distribution exposure

bases of self-insurer members and insured employers. The board shall notify the

commissioner of labor and industry of the amount of excess surplus and recommended

distribution rates and, if the commissioner is in agreement with the board's recommendation,

the commissioner shall issue an order approving the recommended distribution.

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(b)
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An order of the commissioner of
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the Department of
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labor and industry relating to

the
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distribution of
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excess surplus
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distribution
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of the Workers' Compensation Reinsurance

Association shall be reviewed by the commissioner of commerce. The commissioner of

commerce may amend, approve, or reject an order or issue further orders to accomplish the

purposes of
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this
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section
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79.361
and Laws 1993, chapter 361, section 2
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. The commissioner
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of commerce
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may not change the amount of the distribution ordered by the commissioner

of labor and industry without agreement of the commissioner of labor and industry.

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(c) If the board determines that an excess surplus distribution resulted in inadequate

funds being available to pay claims that arose during the period upon which the distribution

was calculated, the board shall determine the amount of the deficiency. The board shall

notify the commissioner of commerce of the amount of deficiency and recommend

assessment rates and the time period for an assessment for self-insurer members and insured

employers. The commissioner of commerce shall order an assessment at the rates and for

the time period necessary to eliminate the deficiency with consideration of potential financial

hardship to employers. The assessment rates shall be applied to the exposure bases of

self-insured employers and insured employers. All assessments under this section are payable

to the association. The commissioner of commerce may issue orders necessary to administer

this section.

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Subd. 3.

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Administration of distribution or assessment.

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The reinsurance association

may consider the actual and reasonable costs of distribution or assessment in determining

the amount to be distributed or assessed. The excess surplus distribution or deficiency

assessment may not be retroactive and applies only prospectively. Self-insurer members,

insurer members, and the Minnesota Workers' Compensation Insurers Association must

provide any information to the reinsurance association that the association determines

necessary to administer this section. Any part of the excess surplus distribution not distributed

within one year due to the inability to identify or locate insured employers remains with the

reinsurance association and must not be distributed to its members.

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Subd. 4.

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Plan of operation.

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The reinsurance association's plan of operation must provide

the method for determining rates and exposure bases, the method for excess surplus

distribution, and the method of collecting a deficiency assessment. For multiyear distributions

or assessments, the exposure bases and rates shall be recalculated for each policy year of

the excess surplus distribution or deficiency assessment.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 6.

Minnesota Statutes 2024, section 79.38, subdivision 1, is amended to read:

Subdivision 1.

Provisions.

The plan of operation shall provide for all of the following:

(a) the establishment of necessary facilities;

(b) the management and operation of the reinsurance association;

(c) a preliminary premium, payable by each member in proportion to its total premium

in the year preceding the inauguration of the reinsurance association, for initial expenses

necessary to commence operation of the reinsurance association;

(d) procedures to be utilized in charging premiums
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, including adjustments from excess

or deficient premiums from prior periods
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;

(e) procedures governing the actual payment of premiums to the reinsurance association;

(f) reimbursement of each member of the board by the reinsurance association for actual

and necessary expenses incurred on reinsurance association business;

(g) the composition, terms, compensation and other necessary rules consistent with

section
79.37
for boards of directors of the reinsurance association;

(h) the investment policy of the reinsurance association;
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and
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(i) the method for determining rates and exposure bases, the method for excess surplus

distribution, and the method of collecting a deficiency assessment; and

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(i)
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(j)
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any other matters required by or necessary to effectively implement sections
79.34

to
79.40
.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 7.

Minnesota Statutes 2024, section 175A.05, is amended by adding a subdivision to

read:

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Subd. 4.

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Active compensation judges.

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If the number of Workers' Compensation Court

of Appeals judges available to hear a case is insufficient to constitute a quorum and retired

judges are not available to meet the quorum requirement, the chief judge of the Workers'

Compensation Court of Appeals may, with the consent of the chief judge of the Court of

Administrative Hearings, assign an active compensation judge from that court to hear any

case properly assigned to a judge of the Workers' Compensation Court of Appeals. The

compensation judge assigned to the case may act on that case with the full powers of a judge

of the Workers' Compensation Court of Appeals. A compensation judge performing this

service shall receive pay and expenses, calculated on an hourly basis, in the amount and

manner provided by law for judges serving on the Workers' Compensation Court of Appeals.

This compensation will be paid as an adjustment to the judge's normal compensation from

the Court of Administrative Hearings. The Workers' Compensation Court of Appeals will

reimburse the Court of Administrative Hearings based on the number of hours spent

performing this service and any other expenditures incurred.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 8.

Minnesota Statutes 2024, section 176.011, subdivision 15, is amended to read:

Subd. 15.

Occupational disease.

(a) "Occupational disease" means a mental impairment

as defined in paragraph (d) or physical disease arising out of and in the course of employment

peculiar to the occupation in which the employee is engaged and due to causes in excess of

the hazards ordinary of employment and shall include undulant fever. Physical stimulus

resulting in mental injury and mental stimulus resulting in physical injury shall remain

compensable. Mental impairment is not considered a disease if it results from a disciplinary

action, work evaluation, job transfer, layoff, demotion, promotion, termination, retirement,

or similar action taken in good faith by the employer. Ordinary diseases of life to which the

general public is equally exposed outside of employment are not compensable, except where

the diseases follow as an incident of an occupational disease, or where the exposure peculiar

to the occupation makes the disease an occupational disease hazard. A disease arises out of

the employment only if there be a direct causal connection between the conditions under

which the work is performed and if the occupational disease follows as a natural incident

of the work as a result of the exposure occasioned by the nature of the employment. An

employer is not liable for compensation for any occupational disease which cannot be traced

to the employment as a direct and proximate cause and is not recognized as a hazard

characteristic of and peculiar to the trade, occupation, process, or employment or which

results from a hazard to which the worker would have been equally exposed outside of the

employment.

(b) If immediately preceding the date of disablement or death, an employee was employed

on active duty with an organized fire or police department of any municipality, as a member

of the Minnesota State Patrol, conservation officer service, state crime bureau, as a forest

officer by the Department of Natural Resources, correctional officer or security counselor

employed by the state or a political subdivision at a corrections, detention, or secure treatment

facility, or sheriff or full-time deputy sheriff of any county, and the disease is that of

myocarditis, coronary sclerosis, pneumonia or its sequel, and at the time of employment

such employee was given a thorough physical examination by a licensed doctor of medicine,

and a written report thereof has been made and filed with such organized fire or police

department, with the Minnesota State Patrol, conservation officer service, state crime bureau,

Department of Natural Resources, Department of Corrections, or sheriff's department of

any county, which examination and report negatived any evidence of myocarditis, coronary

sclerosis, pneumonia or its sequel, the disease is presumptively an occupational disease and

shall be presumed to have been due to the nature of employment. If immediately preceding

the date of disablement or death, any individual who by nature of their position provides

emergency medical care, or an employee who was employed as a licensed police officer

under section
626.84, subdivision 1
; firefighter; paramedic; correctional officer or security

counselor employed by the state or a political subdivision at a corrections, detention, or

secure treatment facility; emergency medical technician; or licensed nurse providing

emergency medical care; and who contracts an infectious or communicable disease to which

the employee was exposed in the course of employment outside of a hospital, then the

disease is presumptively an occupational disease and shall be presumed to have been due

to the nature of employment and the presumption may be rebutted by substantial factors

brought by the employer or insurer. Any substantial factors which shall be used to rebut

this presumption and which are known to the employer or insurer at the time of the denial

of liability shall be communicated to the employee on the denial of liability.

(c) A firefighter on active duty with an organized fire department who is unable to

perform duties in the department by reason of a disabling cancer of a type caused by exposure

to heat, radiation, or a known or suspected carcinogen, as defined by the International

Agency for Research on Cancer, and the carcinogen is reasonably linked to the disabling

cancer, is presumed to have an occupational disease under paragraph (a). If a firefighter

who enters the service after August 1, 1988, is examined by a physician prior to being hired

and the examination discloses the existence of a cancer of a type described in this paragraph,

the firefighter is not entitled to the presumption unless a subsequent medical determination

is made that the firefighter no longer has the cancer.

(d) For the purposes of this chapter, "mental impairment" means a diagnosis of

post-traumatic stress disorder by a licensed psychiatrist
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or
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,
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psychologist
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, or psychiatric

mental health nurse practitioner
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. For the purposes of this chapter, "post-traumatic stress

disorder" means the condition as described in the most recently published edition of the

Diagnostic and Statistical Manual of Mental Disorders by the American Psychiatric

Association. For purposes of section
79.34, subdivision 2
, one or more compensable mental

impairment claims arising out of a single event or occurrence shall constitute a single loss

occurrence.

(e) If, preceding the date of disablement or death, an employee who was employed on

active duty as: a licensed police officer; a firefighter; a paramedic; an emergency medical

technician; a licensed nurse employed to provide emergency medical services outside of a

medical facility; a public safety dispatcher; a correctional officer or security counselor

employed by the state or a political subdivision at a corrections, detention, or secure treatment

facility; a sheriff or full-time deputy sheriff of any county; or a member of the Minnesota

State Patrol is diagnosed with a mental impairment as defined in paragraph (d), and had not

been diagnosed with the mental impairment previously, then the mental impairment is

presumptively an occupational disease and shall be presumed to have been due to the nature

of employment. This presumption may be rebutted by substantial factors brought by the

employer or insurer. Any substantial factors that are used to rebut this presumption and that

are known to the employer or insurer at the time of the denial of liability shall be

communicated to the employee on the denial of liability. The mental impairment is not

considered an occupational disease if it results from a disciplinary action, work evaluation,

job transfer, layoff, demotion, promotion, termination, retirement, or similar action taken

in good faith by the employer.

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EFFECTIVE DATE.

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This section is effective for dates of injury on or after October

1, 2026.

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Sec. 9.

Minnesota Statutes 2024, section 176.081, subdivision 9, is amended to read:

Subd. 9.

Retainer agreement.

An attorney who is hired by an employee to provide legal

services with respect to a claim for compensation made pursuant to this chapter shall prepare

a retainer agreement in which the provisions of this section are specifically set out and

provide a copy of this agreement to the employee. The retainer agreement shall provide a

space for the signature of the employee. A signed agreement shall raise a conclusive

presumption that the employee has read and understands the statutory fee provisions. No

fee shall be awarded pursuant to this section in the absence of a signed retainer agreement.

The retainer agreement shall contain a notice to the employee regarding the maximum

fee allowed under this section in ten-point type, which shall read:

Notice of Maximum Fee

The maximum fee allowed by law for legal services is 20 percent of the first
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$130,000
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$275,000
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of compensation awarded to the employee subject to a cumulative maximum fee

of
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$26,000
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$55,000
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for fees related to the same injury.

The employee shall take notice that the employee is under no legal or moral obligation

to pay any fee for legal services in excess of the foregoing maximum fee.

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EFFECTIVE DATE.

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This section is effective the day following final enactment and

applies to dates of injury on or after October 1, 2024.

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Sec. 10.

Minnesota Statutes 2024, section 176.101, subdivision 2a, is amended to read:

Subd. 2a.

Permanent partial disability.

(a) Compensation for permanent partial disability

is as provided in this subdivision. Permanent partial disability must be rated as a percentage

of the whole body in accordance with rules adopted by the commissioner under section

176.105
. During the 2026 regular legislative session, and every even-year legislative session

thereafter, the Workers' Compensation Advisory Council must consider whether the

permanent partial disability schedule in paragraph (b) represents adequate compensation

for permanent impairment.

(b) The percentage determined pursuant to the rules adopted under section
176.105
must

be multiplied by the corresponding amount in the following table:

Impairment Rating

Amount

(percent)

less than 5.5

$

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114,260

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137,240

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5.5 to less than 10.5

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121,800

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146,297

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10.5 to less than 15.5

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129,485

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155,527

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15.5 to less than 20.5

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137,025

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164,584

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20.5 to less than 25.5

deleted text begin

139,720

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167,821

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25.5 to less than 30.5

deleted text begin

147,000

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176,565

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30.5 to less than 35.5

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150,150

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180,348

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35.5 to less than 40.5

deleted text begin

163,800

deleted text end

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196,744

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40.5 to less than 45.5

deleted text begin

177,450

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213,139

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45.5 to less than 50.5

deleted text begin

177,870

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213,643

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50.5 to less than 55.5

deleted text begin

181,965

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218,562

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55.5 to less than 60.5

deleted text begin

209,475

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251,605

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60.5 to less than 65.5

deleted text begin

237,090

deleted text end

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284,774

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65.5 to less than 70.5

deleted text begin

264,600

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317,817

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70.5 to less than 75.5

deleted text begin

292,215

deleted text end

new text begin

350,986

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75.5 to less than 80.5

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347,340

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417,197

new text end

80.5 to less than 85.5

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402,465

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483,409

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85.5 to less than 90.5

deleted text begin

457,590

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549,621

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90.5 to less than 95.5

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512,715

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615,833

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95.5 up to and including 100

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567,840

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682,045

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An employee may not receive compensation for more than a 100 percent disability of

the whole body, even if the employee sustains disability to two or more body parts.

(c) Permanent partial disability is payable upon cessation of temporary total disability

under subdivision 1. If the employee requests payment in a lump sum, then the compensation

must be paid within 30 days. This lump-sum payment may be discounted to the present

value calculated up to a maximum five percent basis. If the employee does not choose to

receive the compensation in a lump sum, then the compensation is payable in installments

at the same intervals and in the same amount as the employee's temporary total disability

rate on the date of injury. Permanent partial disability is not payable while temporary total

compensation is being paid.

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EFFECTIVE DATE.

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This section is effective for dates of injury on or after October

1, 2026.

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Sec. 11.

Minnesota Statutes 2024, section 176.155, subdivision 1, is amended to read:

Subdivision 1.

Employer's physician.

(a) The injured employee must submit to

examination by the employer's physician, if requested by the employer, and at reasonable

times thereafter upon the employer's request. Examinations shall not be conducted in hotel

or motel facilities. The examination must be scheduled at a location within 150 miles of the

employee's residence unless the employer can show cause to the office to order an

examination at a location further from the employee's residence. The employee is entitled

upon request to have a personal physician or
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unpaid
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witness present at any such examination.

Each party shall defray the cost of that party's physician
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or witness
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.

(b) Any report or written statement made by the employer's physician as a result of an

examination of the employee, regardless of whether the examination preceded the injury

or was made subsequent to the injury or whether litigation is pending, must be served upon

the employee and the attorney representing the employee, if any, no later than 14 calendar

days within the issuance of the report or written statement.

(c) The employer shall pay reasonable travel expenses incurred by the employee in

attending the examination including mileage, parking, and, if necessary, lodging and meals.

The employer shall also pay the employee for any lost wages resulting from attendance at

the examination.

(d) A self-insured employer or insurer who is served with a claim petition pursuant to

section
176.271, subdivision 1
, or
176.291
, shall schedule any necessary examinations of

the employee, if an examination by the employer's physician or health care provider is

necessary to evaluate benefits claimed. The examination shall be completed and the report

of the examination shall be served on the employee and filed with the commissioner within

120 days of service of the claim petition. Any request for a good cause extension pursuant

to paragraph (e) must be made within 120 days of service of the claim petition, except that

a request may be made after 120 days of service of a claim petition in the following

circumstances:

(1) a change to the employee's claim regarding the nature and extent of the injury;

(2) a change to the permanency benefits claimed by the employee, including a change

in permanent partial disability percentage;

(3) a new claim for indemnity benefits; or

(4) the employment relationship is not admitted by the uninsured employer.

(e) No evidence relating to the examination or report shall be received or considered by

the commissioner, a compensation judge, or the court of appeals in determining any issues

unless the report has been served and filed as required by this section, unless a written

extension has been granted by the commissioner or compensation judge. The commissioner

or a compensation judge shall extend the time for completing the adverse examination and

filing the report upon good cause shown. The extension must not be for the purpose of delay

and the insurer must make a good faith effort to comply with this subdivision. Good cause

shall include but is not limited to:

(1) that the extension is necessary because of the limited number of physicians or health

care providers available with expertise in the particular injury or disease, or that the extension

is necessary due to the complexity of the medical issues, or

(2) that the extension is necessary to gather additional information which was not included

on the petition as required by section
176.291
.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 12.

Minnesota Statutes 2024, section 176.221, subdivision 1, is amended to read:

Subdivision 1.

Commencement of payment.

Within 14 days of notice to or knowledge

by the employer of an injury compensable under this chapter the payment of temporary

total compensation shall commence. Within 14 days of notice to or knowledge by an

employer of a new period of temporary total disability which is caused by an old injury

compensable under this chapter, the payment of temporary total compensation shall

commence; provided that the employer or insurer may file for an extension with the

commissioner within this 14-day period, in which case the compensation need not commence

within the 14-day period but shall commence no later than 30 days from the date of the

notice to or knowledge by the employer of the new period of disability. Commencement of

payment by an employer or insurer does not waive any rights to any defense the employer

has on any claim or incident either with respect to the compensability of the claim under

this chapter or the amount of the compensation due. Where there are multiple employers,

the first employer shall pay, unless it is shown that the injury has arisen out of employment

with the second or subsequent employer. Liability for compensation under this chapter may

be denied by the employer or insurer by giving the employee written notice of the denial

of liability. If liability is denied for an injury which is required to be reported to the

commissioner under section
176.231, subdivision 1
, the denial of liability must be filed

with the commissioner and served on the employee within 14 days after notice to or

knowledge by the employer of an injury which is alleged to be compensable under this

chapter. If the employer or insurer has commenced payment of compensation under this

subdivision but determines within
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60
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90
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days of notice to or knowledge by the employer

of the injury that the disability is not a result of a personal injury, payment of compensation

may be terminated upon the filing of a notice of denial of liability within
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60
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90
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days of

notice or knowledge. After the
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60-day
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90-day
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period, payment may be terminated only by

the filing of a notice as provided under section
176.239
. Upon the termination, payments

made may be recovered by the employer if the commissioner or compensation judge finds

that the employee's claim of work related disability was not made in good faith. A notice

of denial of liability must state in detail the facts forming the basis for the denial and specific

reasons explaining why the claimed injury or occupational disease was determined not to

be within the scope and course of employment and shall include the name and telephone

number of the person making this determination.

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EFFECTIVE DATE.

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This section is effective for dates of injury on or after October

1, 2026.

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Sec. 13.

Minnesota Statutes 2024, section 176.322, is amended to read:

176.322 DECISIONS BASED ON STIPULATED FACTS.

If the parties agree to a stipulated set of facts and only legal issues remain, the
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commissioner or
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compensation judge may determine the matter without a hearing based

upon the stipulated facts and the determination is appealable to the court of appeals pursuant

to sections
176.421
and
176.442
. In any case where a stipulated set of facts has been

submitted
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to the Court of Administrative Hearings
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pursuant to this section, upon receipt of

the file or the stipulated set of facts the chief administrative law judge shall immediately

assign the case to a compensation judge for a determination. The
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commissioner or

compensation
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judge shall issue a determination within 60 days after receipt of the stipulated

facts.

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EFFECTIVE DATE.

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This section is effective the day following final enactment.

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Sec. 14.
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REPEALER.
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Minnesota Statutes 2024, sections 79.34, subdivision 2a; 79.361; and 79.363,

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are repealed.

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APPENDIX

Repealed Minnesota Statutes: H4598-1

79.34 CREATION OF REINSURANCE ASSOCIATION.

Subd. 2a.

Deficiency.

If the board determines that a distribution of excess surplus resulted in inadequate funds being available to pay claims that arose during the period upon which that distribution was calculated, the board shall determine the amount of the deficiency. The deficiency shall be made up by imposing an assessment rate against self-insured members and policyholders of insurer members. The board shall notify the commissioner of commerce of the amount of the deficiency and recommend an assessment rate. The commissioner shall order an assessment at a rate and for the time period necessary to eliminate the deficiency. The assessment rate shall be applied to the exposure base of self-insured employers and insured employers. The assessment may not be retroactive and applies only prospectively. The assessment may be spread over a period of time that will cause the least financial hardship to employers. All assessments under this subdivision are payable to the association. The commissioner may issue orders necessary to administer this section.

79.361 POST-1992 DISTRIBUTION OF WORKERS' COMPENSATION REINSURANCE ASSOCIATION SURPLUS.

Subdivision 1.

Scope.

This section governs the distribution of excess surplus of the Workers' Compensation Reinsurance Association declared after January 1, 1993. A distribution of excess surplus is declared on the date the board votes to make a distribution. No distribution of excess surplus other than that provided by this section may be made.

Subd. 2.

Self-insured.

A self-insurer shall receive a distribution of excess surplus in an amount equal to the self-insurer's share of the premiums paid to the Workers' Compensation Reinsurance Association for the period and for each retention layer for which the distribution is made.

Subd. 3.

Insured employers.

A policyholder, other than a policyholder insured by the assigned risk plan or the State Fund Mutual Insurance Company, shall receive a refund of a share of the distribution equal to the policyholder's share of the annual total earned Minnesota workers' compensation insurance premium, as reported to the commissioner of commerce in the most recent annual statements of insurers, including the assigned risk plan and the State Fund Mutual Insurance Company.

Subd. 4.

Assigned risk plan.

A policyholder of the assigned risk plan shall receive a refund of a share of the distribution equal to the policyholder's share of the annual total earned Minnesota workers' compensation insurance premium, as reported to the commissioner of commerce in the most recent annual statements of insurers, including the assigned risk plan and the State Fund Mutual Insurance Company.

Subd. 5.

State Fund Mutual Insurance Company.

A policyholder of the State Fund Mutual Insurance Company shall receive a refund of a share of the distribution equal to the policyholder's share of the annual total earned Minnesota workers' compensation insurance premium, as reported to the commissioner of commerce in the most recent annual statements of insurers, including the assigned risk plan and the state fund mutual insurance company.

Subd. 6.

Distribution defined.

For the purpose of subdivisions 3 to 5, "distribution" means a distribution described in subdivision 1 minus a distribution to self-insurers under subdivision 2.

Subd. 7.

Policyholder.

For the purpose of this section "policyholder" means a workers' compensation insurance policyholder in the calendar year preceding a declaration of excess surplus by the board of the reinsurance association.

Subd. 8.

Information required.

Insurers and the Workers' Compensation Insurers Rating Association of Minnesota must provide the Workers' Compensation Reinsurance Association with information necessary to administer and calculate the refunds to policyholders governed by this section within 60 days of a request by the association. For the purpose of this subdivision, "insurer" includes the assigned risk plan.

Subd. 9.

Refund due date.

Policyholders must receive the refund within 60 days of the day the reinsurance association receives the information required to be provided by subdivision 8.

Subd. 10.

Unclaimed refund.

Any part of the refund not distributed within one year after the due date of a refund under this section due to the inability to identify or locate policyholders remains with the Workers' Compensation Reinsurance Association.

Subd. 11.

Costs of distribution.

The reinsurance association may pay the actual and reasonable costs of the refunds made under this section from earnings on a declared excess surplus prior to its distribution.

79.363 DISTRIBUTION OF EXCESS SURPLUS.

The distribution of excess surplus of the Workers' Compensation Reinsurance Association is not a distribution of excess premiums to members. Any excess surplus not refunded according to Laws 1993, chapter 361, section 2, must be returned to the association and must not be distributed to its members. Any excess surplus not distributed or refunded according to section
79.361
must be retained by the association and must not be distributed to members.