If an employee is injured on the job in Massachusetts and rendered disabled and unable to work, he or she is entitled to workers’ compensation benefits. There are various benefits available for the workers’ compensation insurance policy their employer carries. One of the more important benefits is the disability benefits. These are the payments an injured worker can receive from the workers’ compensation insurance company if their work injury prevents them from earning wages. The Massachusetts Workers’ Compensation Act makes the payment of disability benefits depend on the employee’s average weekly wage (commonly referred to as “AWW”). This is why calculating and verifying the precise average weekly wage is so important.
How the Average Weekly Wage is Determined
Massachusetts General Law Chapter 152, § 1(1) defines “average weekly wage”, generally, as the earnings of the injured employee during the period of twelve calendar months immediately preceding the date of injury, divided by fifty-two. “Earnings” as used in the statute means gross wages including overtime and before the deductions for any state or federal taxes, health insurance contribution, union dues or any other items withheld by the employer. Thus, if an employee has been employed with the same employer for one year or more at the time of his or her injury on the job, the average weekly wage would be calculated by taking the employee’s total gross earnings in the 12 months immediately preceding the injury and divide it by 52.
For Example: A young man suffered a torn rotator cuff on a construction site on September 10, 2016. His injury kept him out of work and he underwent arthroscopy to repair his rotator cuff. Because he was deemed totally disabled for a temporary period of time, he was entitled to total disability benefits from workers’ comp. In order to determine his total disability rate, we needed to calculate his average weekly wage first. So, we would need to know what his earnings were for the twelve months just prior to September 10, 2016. Assume his gross earnings in the 12 months just prior to the injury was $36,480. Therefore, his average weekly wage would be $701.54 ($36,480 ÷ 52 weeks). The temporary total disability rate would then be $420.92 ($701.54 x 60%).
There are many exceptions to the average weekly wage calculation that can affect the average weekly wage calculation. Let’s look at a summary of a few:
- any overtime worked is included in the calculation to determine the average weekly wage;
- if an employee has not worked a full calendar year for the employer, the average weekly wage is computed by dividing the total earnings by the number of weeks employed;
- if an employee lost more than 2 weeks during the 12 month period preceding the injury, then the total earnings shall be divided by the number of weeks remaining after the time lost has been deducted;
- weeks where the employee only received less than five dollars in wages are excluded in determining the average weekly wage, but not if the normal working hours are less than 15 hours each week;
- generally, fringe benefits when paid by the employer are not factored into the average weekly wage calculation, but for union workers some fringe benefits can be included.
As you can see, there is a lot of consideration that must go into determining the average weekly wage. The workers’ compensation insurance company will use a form designated as Form 127 Average Weekly Wage Computation Schedule. The adjusters will use this form to calculate the average weekly wage based on the information they received from the employer. It is imperative that the injured worker, or his or her attorney, calculate the average weekly wage themselves and compare it to the findings of the insurance company. The higher the average weekly wage, the more the weekly disability benefit checks and any potential lump sum settlement.
Get Legal Help After Being Injured On The Job
If you have been injured in a work related accident in Massachusetts, you should seek legal advice from an experienced injury attorney. You should make sure you are getting what you are entitled to. One very important consideration is to be certain that the average weekly wage is correct because the disability payments depend on the average weekly wage.
Mahaney & Pappas, LLP specialize in workers’ compensation and can help answer your questions and explain your legal rights. One of the first and most important matters to address is that of the average weekly wage. We always make sure that our clients are receiving the full benefits they deserve after a work injury. This means determining the total earnings of our clients, calculating their average weekly wage and verifying that the insurance company is using the accurate average weekly wage in calculating the disability payments.
We offer free, no-obligation meetings and case evaluations. Call us today at (508) 879-3500 or contact us online. We are happy to sit down with you and review your legal matter.