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Calculating wages in workers’ compensation benefits and L&I claims

Wage calculation in workers compensation L-and-I claim

The value of time-loss compensation benefits is based upon wages a person was getting at the time of work injury or occupational disease manifestation. If the person was working a second job, the value of that income must also be included in the wage computation. The Department of Labor and Industries (L&I) computes monthly wages according to RCW 51.08.178.

 

How to calculate wages under a workers’ compensation claim?

Procedurally, there is a computation for regular and continuous employment and a computation for seasonal, intermittent or part-time employment. Also, there’s a “catch all” computation that considers “like employee” wages. Moreover, bonuses are always applied when the gross monthly wage is calculated. And, generally speaking, L&I should apply the computation that is fair and equitable. Finally, other compensation received as part of the contract for hire must also be included.

 

Common examples of other compensation includes housing, meals, commissions, and the value of employer paid health care benefits. Tips, for restaurant workers for example, are only included when workers report them to the employer for federal income tax purposes or when the employer distributes them to employees.

 

What is a Wage Order in an L&I claim?

Typically, once the Department has collected all of the relevant information for computing the monthly wage, it issues a “wage order”. This order explains how the Department arrives at the worker’s wage rate calculation. Because L&I decides and issues the wage order, injured workers can protest or appeal the decision within 60 days or they become final and binding.

 

If a wage order becomes final and binding, a worker can’t challenge the calculation later. Once a wage order is final, further changes to the computation and time-loss compensation payments only occur if: (1) There is a cost of living increase; (2) An offset is applied; or (3) There is a change of circumstance.

 

What is a change of circumstance for wage recalculation?

Under RCW 51.28.040, people injured at work can apply for a change in the wage rate computation if a change in circumstances warrants an increase or rearrangement of compensation. If granted, L&I may apply the readjustment up to sixty days prior to the receipt of the application.

 

Common examples of a change in circumstance warranting wage rate changes include termination of employer paid health care benefits, a subsequent change to the date of injury or disease manifestation, or changes regarding dependents. To apply for a change in circumstance, an injured worker should send a written request to the claims manger. The written request must explain the change, when it occurred, and a request for recalculation based on the change.

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