VACATION OF AWARD – MUTUAL MISTAKE. The failure by all parties to take into consideration additional hours and wages earned by the employee in the 26 weeks preceding her date of injury, and the ongoing reliance on the incorrect AWW, constitutes a mutual mistake of fact warranting the vacation of an award on stipulation limited only to the stipulated AWW, and the vacation of a findings and order, and amended findings and order, limited only to the stipulated AWW.
Attorneys: Michael F. Scully, SiebenCarey, P.A., Minneapolis, Minnesota, for the Petitioner. Brent Kleffman, Brown & Carlson, P.A., Minneapolis, Minnesota, for the Respondents.
Petition to Vacate Granted.
PATRICIA J. MILUN, Chief Judge
On the basis of a mutual mistake of fact, the employee petitions this court to exercise its authority under Minn. Stat. § 176.461, to vacate and set aside the May 22, 2020, Award on Stipulation, and to vacate and set aside Stipulation of Fact 1 as set forth in the Findings and Order served and filed June 13, 2022, and in the Amended Findings and Order served and filed June 28, 2022.[1] We grant the petition.
The employee, Sara Dutton, suffered a low back strain on December 9, 2019, when she slipped on ice on the driveway of a client’s home while working as a home healthcare nurse. The employer admitted liability and initiated payment of temporary total disability (TTD) benefits. In both the First Report of Injury and the Notice of Insurer’s Primary Liability Determination, the employer represented the employee’s average weekly wage (AWW) as $1,730.76.[2] The employee’s benefits were paid at the maximum compensation rate of $1,134.24.
The employer sought to discontinue the employee’s TTD benefits and filed a Notice of Intention to Discontinue benefits (NOID) on January 23, 2020. At that time, the employee was not represented and she did not file an objection.
The employee obtained legal representation on March 12, 2020. The employee’s counsel filed an objection to the NOID on March 18, 2020. That same day, the employer filed a pretrial statement, representing to all parties that there was no wage dispute. On April 16, 2020, the employee filed a pretrial statement which also did not set forth AWW as an issue in dispute. The following day, the employee served the employer with a formal demand for discovery seeking, among other information, wage records. The employer did not respond to this discovery demand.
The parties resolved the employee’s to-date claims and submitted a stipulation for settlement to a compensation judge for review and approval on May 21, 2020. Paragraph (I)(D) of the agreement states that, “[o]n December 9, 2019, the Employee’s average weekly wage was $1,730.76.”[3] The compensation judge issued an Award on Stipulation the following day.[4]
On June 4, 2020, the employer filed another NOID, alleging the employee’s injury had resolved. The matter came on for an administrative conference, and an order discontinuing the employee’s benefits was issued on July 16, 2020. The employee then filed an objection to the discontinuance and requested that the matter be set for hearing.
On August 11, 2020, the employee served a second formal demand for discovery, though wage records were not requested. The employer filed a pretrial statement on September 2, 2020, which was amended on October 1, 2020, indicating that there was no wage dispute. The employee filed a pretrial statement on September 3, 2020, and did not list AWW as an issue in dispute. At section G(4) stating, “If there is a wage dispute, identify the claimed average weekly wage for the injury(s),” the employee’s response was, “$1,730.76,” the same amount identified by the employer on the First Report of Injury and the Notice of Insurer’s Primary Liability Determination.[5]
The employee’s objection to the discontinuance of TTD benefits was heard before a compensation judge, who reinstated those benefits by Findings and Order served and filed on November 3, 2020. The employee’s AWW was not at issue in this hearing.[6] This decision was not appealed.
On July 28, 2021, the employer filed a NOID seeking to discontinue the employee’s TTD benefits on the basis that the employee had rejected a job offer. At that time, the employee had been paid 73 weeks of TTD and 3 weeks of temporary partial disability (TPD) benefits at the maximum compensation rate. The matter came on for an administrative conference, and the discontinuance was denied by order served and filed on August 26, 2021. The employer then filed a petition to discontinue the employee’s benefits and requested a formal hearing. On September 16, 2021, the employer filed a pretrial statement which indicated there was no wage dispute. The employee filed a pretrial statement on September 21, 2021, which did not list AWW as an issue in dispute. At section G(4) stating, “If there is a wage dispute, identify the claimed average weekly wage for the injury(s),” the employee responded, “Not applicable. Parties have stipulated to an average weekly wage $1,730.76.”[7] The employer provided a similar response in its pretrial statement filed January 10, 2022.
The employer’s petition to discontinue came on for hearing on April 11, 2022. By Findings and Order served and filed June 13, 2022, the employer’s petition to discontinue was denied. According to Stipulation of Fact 1 in the Findings and Order, the parties stipulated that, “The employee’s average weekly wage (AWW) is $1,730.76, with a compensation rate of $1,134.24.”[8] No appeal was taken from this decision.[9]
In August 2022, the employer filed a NOID, indicating the employee had been paid the statutory maximum 130 weeks of TTD benefits. By late 2022, the employee had been released to return to work with permanent restrictions.[10] Those permanent restrictions could not be accommodated by the employer. The employee secured new employment at a lower wage. On April 28, 2023, the employee filed a claim petition seeking TPD benefits, and an underpayment of TTD benefits based upon an alleged AWW of $2,241.37. Attached to the claim petition were wage records and calculations from both her recent employment and former employment with the employer.[11]
The employee served a formal demand for discovery on September 28, 2023, which did not request wage records or information. The employer timely responded to this demand and disputed the alleged wage loss, referring to the employee’s current wage and the AWW as stipulated to in the 2020 stipulation for settlement. The employee served a supplemental demand for discovery on April 2, 2024, seeking wage calculations and records. The employer responded on May 2, 2024, and again on May 20, 2024, at which time the employer produced wage records for the weeks preceding the December 9, 2019, date of injury, dating back to May 2019.[12]
The wage records for the approximate 26 weeks preceding the employee’s December 9, 2019, injury, detail the employee’s hours worked and rate of pay on a biweekly basis. [13] The employee earned an hourly rate of $43.27 for hours demarcated as “RN-30+ Points” and an hourly rate of $40.00 for “RN-31 Plus Points.” During this time period, the employee worked 80 hours biweekly at the higher pay rate, and an average of 22.8 additional hours biweekly at the lower pay rate.[14]
On January 28, 2025, the employee withdrew her claim petition and the matter was dismissed without prejudice.
On August 26, 2025, the employee petitioned this court to vacate and set aside the May 22, 2020, Award on Stipulation. At oral argument on December 2, 2025, procedural issues were raised. The record was held open to allow further consideration of those issues. On January 5, 2026, the employee amended her petition to also vacate Stipulation of Fact 1 as set forth in the June 13, 2022, Findings and Order and in the June 28, 2022, Amended Findings and Order. The employer filed a timely objection to the employee’s amended petition.
The employee petitions to vacate and set aside the May 22, 2020, Award on Stipulation, and Stipulation of Fact 1 as set forth in the June 13, 2022, Findings and Order and in the June 28, 2022, Amended Findings and Order. These awards incorporate, as stipulated fact, that the employee’s AWW at the time of her injury was $1,730.76. The employee contends that these awards should be set aside based on mutual mistake of fact. The employer contends there was no mutual mistake of fact and that the stipulations should remain in effect. The employer further responds that any mistake as to weekly wage is an error of law, not of fact, and to that end, the petition must be denied. The primary question raised by the petition is whether a unilateral mistake of fact made by the employer, and a subsequent mistake of the same fact made by the employee, constitutes a mutual mistake of fact as contemplated under Minn. Stat. § 176.461.
The Workers’ Compensation Court of Appeals has broad discretion pursuant to Minn. Stat. § 175A.07, subd. 3, to hear petitions to vacate and set aside awards in the first instance under Minn. Stat. § 176.521 and under Minn. Stat. § 176.461.[15] Under Minn. Stat. § 176.461, an award may be set aside for cause. The statute defines “for cause” to include a mutual mistake of fact.[16] A mutual mistake of fact occurs when parties misapprehend some fact material to the claim.[17] The mistake must be one of fact, and not one of law.[18] The mistake must be mutual.[19] When analyzing whether a mutual mistake has occurred, “the inquiry focuses on what the situation was and what was known about it at the time of settlement.”[20] Further, “[t]he development of new facts about the injury after the award, or even the subsequent discovery of facts in existence but unknown at the time the award was made, is sufficient to justify the vacation of an award.”[21]
In this case, the employee sustained an admitted work-related injury on December 9, 2019. The biweekly payroll records for the 26 weeks preceding her injury show that the employee was paid for 80 hours of work every two weeks at an hourly rate of $43.27. Those biweekly payroll records also show that the employee was paid for additional hours of work that varied each two-week pay period at a rate of $40.00.
At the outset of the injury, the employer calculated the employee’s AWW using the $43.27 rate of pay to calculate an annual base salary of $90,000.00, then divided by 52 weeks in a year, resulting in an alleged AWW of $1,730.76. The additional hours worked by the employee in every pay period during the 26 weeks preceding the injury, paid at an hourly rate of $40.00, were not taken into consideration by the employer in computing the AWW. The AWW was incorrectly calculated and reported by the employer, and the reliance on this incorrect AWW was a unilateral mistake of fact on the part of the employer.[22]
The AWW of $1,730.76 was reported by the employer in their First Report of Injury and Notice of Primary Liability Determination in the days following the injury. The employer filed a NOID in January 2020, to which the employee first objected with the assistance of counsel in March 2020. Both parties filed pretrial statements in April 2020, and both parties represented that there was no wage dispute. The employee demanded wage records. Shortly after the employer’s discovery responses were due, the parties entered into a stipulation for settlement in May 2020, where the parties agreed, as a stipulated fact, that the employee’s AWW was $1,730.76. By the time of settlement, the employee had relied upon and adopted the employer’s incorrectly calculated AWW. As such, the mistake of fact became mutual between the parties[23] and reliance on the mistake of fact was carried forward as disputes over benefits were litigated.
The employer and insurer argue that there is no mistake of fact, mutual or otherwise, regarding the calculation of the employee’s AWW, and that if any mistake was made, a mistake as to methodology of calculation constitutes legal error. We disagree. Under the unique facts of this case, the issue is not whether the methodology of calculation chosen by the employer was legally correct, but that the employer only included the employee’s base wages (RN-30+ Points at $43.27 per hour), and failed to include the employee’s wages for additional hours (RN-31+ Points at $40.00 per hour) that were part of her overall earnings. Whether dividing by 26 weeks, 52 weeks, or any other similar method, the entirety of the employee’s hours and earnings should have been included in the AWW calculation.
We hold the failure by all parties to take into consideration additional hours and wages earned by the employee during the 26 weeks preceding her date of injury, and the ongoing reliance on the incorrect AWW is a mutual mistake of fact resulting in a disparity between the employee’s actual earnings and the AWW memorialized in the 2020 stipulation for settlement and subsequent awards. Therefore, we vacate and set aside for cause the May 22, 2020, Award on Stipulation limited solely to paragraph (I)(D) of the underlying stipulation for settlement, and vacate Stipulation of Fact 1 contained in the June 13, 2020, Findings and Order, and in the June 28, 2022, Amended Findings and Order.[24]
[2] Exs. B and C. The employee’s regular rate of pay was $43.27 per hour. (See also Ex. U.) This rate of pay was used to approximate the employee’s AWW as set forth in these exhibits.
[3] Ex. E.
[4] Ex. F.
[5] Ex. 8.
[6] Ex. K.
[7]Ex. 10. The employee filed an amended pretrial statement to include an additional exhibit not related to the employee’s AWW. (Ex. 11.)
[8] Ex. O.
[9] And no appeal was taken from the June 28, 2022, Amended Findings and Order.
[10]The employee was paid permanent partial disability benefits after having been rated with 3.5% permanency pursuant to Minn. R. 5223.0390, subp. 3B.
[11] Ex. P.
[12] Exs. T and U.
[13] Ex. U.
[14] For the pay periods ending on June 16, 2019, through December 15, 2019, the employee worked a total of 1,088 hours at the higher pay rate and 319.12 hours at the lower pay rate. (Id.)
[15] See Lykins v. Anderson Contracting, Inc., 20 N.W.3d 880 (Minn. 2025) (holding that “[i]n recognition of the broad language of Minnesota Statutes section 176.521, subdivision 3,” the WCCA has the statutory authority to set aside awards not only for cause, but also when the settlement is invalid under Minn. Stat. § 176.521, subd. 1(a)).
[16] Minn. Stat. § 176.461(b)(1).
[17] Shelton v. Schwan’s Sales Enters., 53 W.C.D. 110, 113 (W.C.C.A. 1995), summarily aff’d (Minn. Sept. 5, 1995).
[18] Fieck v. Brandrup & Assocs., No. WC04-142 (W.C.C.A. Oct. 6, 2004).
[19] Slaight v. Exceptional Homes, 70 W.C.D. 78 (W.C.C.A. 2010).
[20] Franke v. Fabcon, Inc., 509 N.W.2d 373, 377, 49 W.C.D. 520, 525 (Minn. 1993).
[21] Monson v. White Bear Mitsubishi, 663 N.W.2d 534, 539-40, 63 W.C.D. 337, 344 (Minn. 2003).
[22] See Minn. Stat. § 176.011, subd. 18 (definition of “weekly wage” requires that “if overtime is regular and frequent throughout the year it shall be taken into consideration.”)
[23] See Buzzell v. Buzzell Masonry, Inc., slip op. (W.C.C.A. Dec. 30, 1993) (vacating the AWW stated in the stipulation where parties stipulated to AWW amount that was assumed correct and not subject to dispute).
[24] See Olsen v. Mackay/Minn. Envelope, No. WC12-5476 (W.C.C.A. Dec. 12, 2012) (vacating an award on stipulation solely as it relates to certain attorney fees).