PA Workers’ Comp: The Average Weekly Wage
We will focus on Average Weekly Wage PA for this article. Other state rules may vary. In PA, the Department of Labor and Industry oversees the Bureau of Workers’ Compensation. The Department of Labor and Industry calculates the statewide average weekly wage rate for the calendar year.
What Is Average Weekly Wage (AWW)?
The average weekly wage is the calculation used to determine an injured workers average wages. Based on pre-injury earnings, it reflects the likely earnings if not for the injury. Workers compensation benefits use the AWW to determine compensation rate for lost wages.
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Inclusions and exclusions can have an impact on the weekly compensation. The workers’ compensation rate schedule uses the AWW to determine the benefits due.
Included In AWW
Overtime Pay
The AWW includes overtime.
Bonuses and Incentive Pay
Annual bonuses and incentive pay undergo proration over the year and factor into the AWW.
Vacation Pay
Vacation pay also undergoes proration over the year. This ensures that time off does not negatively impact the worker’s AWW.
Prevailing Wage Rate Work
For those receiving a prevailing wage paid at times, the AWW can use these higher wages to more accurately reflect earnings.
Tips
Tips and gratuities reported on a federal income tax return can contribute to the AWW.
Board And Lodging
If an employer offers board and lodging as part of compensation, its value can factor into the AWW.
Supplemental Unemployment Benefits (SUB)
SUB pay, provided under a collective bargaining agreement, may qualify for inclusion.
Excluded From AWW
Fringe Benefits
This would exclude things like: contributions to retirement plans, health insurance, and life insurance.
Unemployment Benefits
Unemployment benefits received during a layoff do not count towards the AWW. They do not qualify as wages earned from employment.
Non-monetary Remuneration
Benefits received in forms other than money, excluding board and lodging, do not contribute to the AWW.
Earnings from Independent Contractor Work
Income from independent contractor work does not count toward AWW.
Vacation Pay Received After Injury
Vacation time paid out after the injury date does not increase the AWW, as it reflects earnings for work performed prior to the injury.
Mileage Reimbursements and Certain Allowances
Reimbursements for mileage and other business-related expenses do not count as wages for the AWW.
Veterans’ and Social Security Benefits
These benefits do not qualify for inclusion since they do not stem from job earnings.
How To Calculate Average Weekly Wage
Fixed Wages
For workers with fixed wages, the AWW calculation remains clear. If you receive a daily wage, weekly, monthly, or yearly, calculate what this amounts to for one week of work. You may base this on the number of days you work in a week.
Varied Wages
Workers with varied wages have a tougher calculation. First, you average the earnings over four 13-week periods right before the injury. Next, you drop the lowest of these four. Then, average the remaining three to find the AWW.
Special Cases
Seasonal Employment
With jobs performed only part of the year, special rules exist. The calculation of the AWW relies on earnings from all jobs in the past year.
Concurrent Employment
For workers holding multiple jobs at the time of injury, the AWW considers wages from all concurrent employments.
Wrap Up
Knowing how to calculate your AWW ensures you will receive the maximum compensation you deserve. Your AWW calculation should accurately reflect your earnings potential had the injury not occurred.
For injured workers with workers’ compensation claims, always speak with a workers’ compensation lawyer. Average weekly wage falls into one of those complex areas of the law. An experienced lawyer can help interpret these rules in the context of your specific situation.
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