How Is Average Weekly Wage Calculated in an Alabama Workers’ Compensation Case

How Is Average Weekly Wage Calculated in an Alabama Workers’ Compensation Case?

Many injured workers understand that their workers’ compensation checks are based on their average weekly wage (AWW), but fewer understand how that figure is calculated. Questions often arise when temporary total disability (TTD) benefits seem lower than expected.

Under Alabama law, an injured worker’s average weekly wage is generally calculated by adding up all earnings during the 52 weeks immediately preceding the work injury and dividing that total by 52. Earnings include regular wages as well as bonuses, overtime, and other compensation received during that period.

If the worker missed one or more weeks during the 52-week period and received no pay at all for those weeks, those weeks should be excluded from the calculation so the average is not artificially lowered.

Fringe benefits, such as employer-paid health insurance, are not included in the average weekly wage calculation as long as the employer continues paying its portion of those benefits while the worker is off work. If the employer stops paying its share of fringe benefits, however, the value of those benefits must be added to the wage calculation.

When an injured worker has not been employed for a full 52 weeks prior to the injury, the law provides alternative methods. In that situation, the worker’s earnings are averaged over the number of weeks actually worked. If that calculation would be unfair or does not accurately reflect earning capacity, the average weekly wage of a similarly situated employee may be used instead.

Errors in average weekly wage calculations are common. Bonuses are overlooked, unpaid weeks are not excluded, or fringe benefits are improperly omitted. Because disability benefits are calculated as a percentage of the average weekly wage, even a small error can significantly reduce weekly compensation over time.

Ensuring that your average weekly wage is calculated correctly is critical to receiving the full benefits you are entitled to while recovering from a work injury. Reviewing wage calculations carefully can make a meaningful difference in the amount of compensation paid.

If you have suffered a job injury and you have questions about your rights and benefits under Alabama’s workers compensation laws -don’t hesitate to contact and speak with one of the experienced Alabama Workers Compensation and Social Security Disability attorneys at Powell and Denny today for a free consultation. Appointments are available in person, or virtually via Zoom if more convenient.  Powell and Denny would appreciate the opportunity to help.  And remember, there is no fee unless you win.

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How Is Average Weekly Wage Calculated in an Alabama Workers’ Compensation Case