Top Court to calculate benefits using AWW at time of disability
Case name: Roberts v. Sea-Land Services, Inc., et al., No. 10-1399 (U.S. 03/20/12).
Ruling: The U.S. Supreme Court held that an injured worker was entitled to benefits under the Longshore and Harbor Workers' Compensation Act calculated using the national average weekly wage in the fiscal year he became disabled.
What it means: Under the Longshore and Harbor Workers' Compensation Act, a worker's benefits are capped for most types of disability at twice the national average weekly wage for the fiscal year in which he is "newly awarded compensation." According to the U.S. Supreme Court, a worker is "newly awarded compensation" when he first becomes disabled.
Summary: A worker at a marine terminal injured his neck and shoulder when he slipped and fell on a patch of ice. The employer voluntarily paid benefits for three years. When the employer discontinued payments, the worker filed an LHWCA claim. The administrative law judge awarded him benefits using the national average weekly wage during the year he became disabled. The worker sought reconsideration. The Supreme Court held that he was entitled to benefits calculated using the national AWW in the fiscal year he became disabled.
Under the LHWCA, a worker's benefits are capped for most types of disability at twice the national AWW for the fiscal year in which he is "newly awarded compensation." The worker contended that "awarded compensation" means "awarded compensation in a final order." The employer responded that "awarded compensation" means "statutorily entitled to compensation because of disability." The Court agreed with the employer's interpretation.
The Court explained that under the worker's theory the statute would have no application in many cases in which no formal orders were issued because the employers make voluntary payments or the parties reach informal settlements. The Court also said it was "difficult to see" how an employer could apply a national AWW other than the one in effect at the time a worker became disabled.
Additionally, the Court explained that under the worker's reading two workers who earned the same salary and suffered the same injury on the same day could be entitled to different rates of compensation if they obtained orders in different fiscal years. Also, under the worker's interpretation, workers could delay the entry of an order to receive increased benefits.
A dissenting justice would have held that an injured worker is "newly awarded compensation" when the employer voluntarily pays benefits or an ALJ, the benefits review board, or a court orders the employer to pay benefits.
Read more at the WorkersComp Forum homepage.
April 26, 2012
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