For injured workers who regularly work overtime, how overtime pay fits into workers’ compensation claim calculations is an important question. Will you lose out on your overtime wages while injured? And can you work overtime once you return to work, but before you are fully recovered? These are two of the more common concerns injured workers have in respect to overtime. The good news is that overtime is taken into consideration, you should not lose your overtime wages, and you can work overtime while on light duty.
Is Overtime Pay Calculated into My Average Weekly Wage?
Overtime pay is calculated into your average weekly wage. As long as you have paid taxes on them, wages, vacation pay, tips, overtime, holiday pay, bonuses, and incentive pay all count towards your average weekly wage. This calculation also depends upon how long you were working for your employer before being injured on the job.
Once you know which types of wages count towards your average weekly wage, add them all up and multiply the amount by ⅔ to get a general idea of what your wage loss benefits will be. This is called your “compensation rate,” but as with most things in the world of workers’ compensation, it is not that simple. There is a maximum compensation rate based on the statewide average weekly rate, and below that maximum, there are three zones which you may fall within. The first zone utilizes the ⅔ calculation, the second zone has a fixed rate, and the third zone at the bottom of the wage scale has a 90% calculation.
Each year the statewide average weekly wage is adjusted, so determining which zone you fall into will depend on the current year’s adjustment. A workers’ compensation attorney can help you determine what your average weekly wage is and which of the three compensation zones you fall within.
Partial Disability, Limited Work Hours, and Overtime
As we discussed in this article covering partial disability, to calculate your weekly wage in this situation, subtract your current gross weekly wage from your pre-injury average weekly wage, then multiply it by ⅔. For example, if your pre-injury average weekly wage was $900 and your current gross weekly wage is $600, your partial disability benefits would be $200 (⅔ of the $300 difference). And keep in mind that this partial disability wage is also limited by the statewide maximum average weekly wage.
But just because you are working light duty due to your partial disability does not bar you from working overtime. According to the Equal Employment Opportunity Commission (EEOC), workers returning to light duty are treated the same as disabled workers under the Americans with Disabilities Act (ADA). This means that they can work overtime despite still being injured because otherwise, that would be unfair to workers with disabilities who are more often on light duty permanently. This case against United Airlines is just one example of how this rule benefits workers who are on partial disability.
However, there are some cases in which your partial disability affects your working hours. You may be cleared to return to work, but limited to working a certain number of hours each day. In this situation, you would not be able to work overtime because that would exceed your work limit as imposed by your treating physician. The good news is that in such a case you could still receive compensation for your lost overtime even if you are cleared to work full time. These benefits can last up to 500 weeks just like any other partial wage loss benefits. This is good news for any employee who regularly worked overtime and relied on those funds to make ends meet.
For employees who regularly work overtime, you will be glad to know that workers’ compensation does take overtime pay into consideration. It is incorporated into average weekly wage compensation and generally cannot be denied to injured workers who are on light duty. However, there may still be some constraints on your overtime when injured, such as if your treating physician has imposed limitations on the number of hours or days you can work each week.
As long as you pay taxes on an income type, such as overtime, it can be included in your average weekly wage calculations. But, even with overtime included, your compensation rate must still fall at or below the statewide average weekly wage maximum compensation rate.
Contact Hillsberg Law
If you have been injured on the job, an experienced workers’ compensation attorney can help you receive the compensation you deserve — including compensation for lost overtime pay. My name is Geoffrey Hillsberg, and I have been solely practicing workers’ compensation law since 1995.
The advice offered above is general in nature and may not be applicable to every case. Consultation with an attorney is highly recommended. Reliance on this advice does not represent the formation of an attorney-client relationship in the absence of a fee agreement with Mr. Hillsberg.