Calculation of Partial Disability in PA Workers’ Compensation
The correct payment of wage loss (also known as “disability” or “indemnity”) benefits under Pennsylvania Workers’ Compensation Law is a thorny issue in many, many cases. There are twists and turns to the calculation of wage loss benefits which can make even experienced workers’ comp attorneys’ heads spin.
The calculation of partial disability benefits by itself, however, is comparatively easy, but many of our clients do not understand how to perform the calculations, and the resulting figures are not necessarily intuitive.
The starting point for calculating wage loss benefits in PA workers’ comp is the preinjury average weekly wage (AWW). The calculation of the preinjury AWW is the subject of much nuance and reams of case law all by itself, but the basic concept is that the AWW is supposed to reflect the preinjury earnings experience of the injured worker, or, for someone who recently started a job, what the worker expected to earn if he or she had not been hurt. We often explain the AWW to our clients as the “yardstick” against which subsequent losses of earnings due to the work injury are measured. Put simply, if the injured worker cannot earn his or her preinjury AWW after the injury, because of the injury, then either temporary total disability (TTD) benefits or temporary partial disability (TPD) benefits should be paid by the insurance carrier.
TTD benefits are paid if the injured worker cannot work at all due to the injury. But many people are able to work in some capacity after an injury, they just might not able to earn as much as they could earn before the injury. These people are entitled to TPD benefits.
The calculation for TPD benefits is the difference between the preinjury average weekly wage and the amount the injured worker is able to earn, multiplied by two-thirds. In other words, expressed algebraically: TPD = (AWW – current wages) x 2/3. So, as an example, if your preinjury wages were $900.00 per week, and you are still injured with doctor’s restrictions which only allow you to earn $600.00 per week, then $900.00 – $600.00 = $300.00 x 2/3 = $200.00 TPD still due.
Note that if you earn at or above your preinjury AWW, your wage loss benefits will be suspended, but your medical benefits will continue. Additionally, partial disability benefits are only payable for up to 500 weeks (about 9.6 years).
There are many ways which an insurance company can seek to modify the benefits of an injured worker from total disability to partial disability, even if the injured worker has not actually returned to work. These methods of trying to stop or reduce a claimant’s check are the subject of other articles, but they each have their own nuances and pitfalls.
Pennsylvania Workers’ Compensation is a specialized area of practice, and is filled with unexpected twists and turns. Employers are typically provided lawyers by their insurance companies who only practice workers’ compensation law. Injured workers are well-advised to consult certified specialist workers’ compensation claimant’s attorneys when they have had a work injury.