Massachusetts Department of Industrial Accidents Issues Ruling on Proper Amount for Employee’s Average Weekly Wage

Accounting FiguresOne of the realities of workers’ compensation claims is that the insurer is required to issue payments for the injured employee’s average weekly wage. Sometimes this is an easy calculation when an employee has worked for the same company for a number of years, and good records are kept of the tax forms issued to the employee. Other times, when an employee is issued paychecks on an intermittent basis or when an employee works for only a short time, it can be difficult to establish the average weekly wage. At least, it opens up the possibility of disputes between insurers and employees on what that amount should be. In a recent workers’ compensation case, the DIA, the administrative body responsible for Massachusetts workers’ compensation disputes, analyzed the appropriate average weekly wage for a workers’ compensation claimant.

The employee worked as a carpenter and was injured at work while moving a large piece of machinery. There was never any dispute that the employee was covered under his employer’s workers’ compensation policy. The primary issue under consideration was the employee’s average weekly wage.

The insurer began paying the employee weekly benefits based on an estimated average weekly wage of $800. The employee, however, contested these payments, arguing that the estimated average weekly wage was approximately $1,500. In support of this figure, the employee submitted 35 weeks of paychecks and a 2011 IRS Form 1099, issued by his employer. The conference order granted the employee an average weekly wage of $1,490.33. The judge’s hearing decision raised that figure to $1,726.37, even though the employee did not appeal the conference order. The insurer appealed, arguing that the ALJ could not raise the employee’s average weekly wage on its motion.

Although there was a wide disparity between the employer’s calculations and the employee’s, the DIA noted discrepancies in the evidence presented by the employee. For instance, the Form 1099 submitted showed an average weekly wage of $1,505.08, rather than $1,490.33. In addition, the relevant 52-week pay period was May 2, 2011 through the date of injury (May 2, 2012). The Form 1099 included payments made during the calendar year and therefore was missing 17 weeks between January 1, 2012 and the date of injury.

The DIA vacated the ALJ’s finding, in accordance with the insurer’s wishes, that the injured party should receive compensation based on an average weekly wage of $1,726.37, and it ordered the insurer to pay the employee benefits based on the $1,490.33 average weekly wage determined at the conference.

The DIA provides an appeals process for employees whose workers’ compensation benefits are denied or incorrect. Attorney Michael O. Smith has courtroom experience and takes an aggressive approach to seeking out an employee’s rightful benefits. If you have a case before the DIA, or your workers’ compensation case is denied, the Boston workers’ compensation attorneys at the Law Offices of Attorney Michael O. Smith can help. Call us at (617) 263-0060 to schedule a consultation about your case.

More Blog Posts:

Injured Employee Entitled to Continuing Benefits, Since Insurer Failed to Meet Burden of Showing Medical Condition Improved According to Massachusetts Law, Boston Workers’ Compensation Attorney Blog, January 12, 2017

Department of Industrial Accidents Review Board Holds that When Bondholder Runs Out of Funds to Pay Benefits, Employee’s Widow Remains Protected by Massachusetts Workers’ Compensation Law, Boston Workers’ Compensation Attorney Blog, November 18, 2017

Photo credit: 777546 [CC0 Creative Commons], via Pixabay