What Exactly Is An Average Weekly Wage?
By: Holly R. Stephens
If you have spent any time dealing with workers’ compensation cases in North Carolina, you might have heard the phrase “Average Weekly Wage.” Figuring out a claimant’s average weekly wage is crucially important in a workers’ compensation claim as it is used to determine a claimant’s compensation rate, calculate a claimant’s indemnity benefits, permanency compensation, and determine an employee’s wages needed for a return to work.
N.C. Gen. Stat. §97-2 (5) states that Average Weekly Wage: “Shall mean the earnings of the injured employee in the employment in which the employee was working at the time of the injury during the period of 52 weeks immediately preceding the date of the injury…”
§97-2(5) goes on to describe the various methods for calculating an employee’s average weekly wage. These methods are listed below:
For employees who have worked one (1) year or more prior to the date of injury:
Divide the earnings of the injured employee in the 52 weeks prior to the date of injury by 52. This method is suitable for an injured employee who HAS NOT missed more than 7 consecutive calendar days in the 52 week period of time.
If the injured employee has missed more than seven (7) consecutive calendar days on one or more occasions during this 52 week period:
Deduct these weeks when calculating your AWW. For example: If an injured employee had been employed for 1 year or more, then you would divide that employee’s earnings from the 52 weeks prior to the date of injury by 52 weeks. However, if that employee had missed 7 consecutive calendar days during that period of time, you would divide the employee’s earnings by 51 weeks.
If the injured employee worked less than 52 weeks prior to the date of the injury:
Divide the injured employee’s total earnings by the number of weeks the injured employee worked.
If the period of employment prior to injury was less than 52 weeks and was so short that it is impractical to use the method in #2 above:
Apply the wages of an employee of a similar grade and character employed in the same class of employment in the same locality or community as the injured employee.
If none of the above methods are fair, either to the employer or employee:
Utilize the amount of money that would most closely approximate the amount of money the injured employee would be earning the 52 weeks prior to the date of the injury.
If you have any questions about calculating average weekly wage, please contact one of our experienced workers’ compensation attorneys.
And, while you’re at it, be sure to check out our Average Weekly Wage Calculator on our Resources page!