In last month's column, we reviewed the Pennsylvania Commonwealth Court case of Sadler v. Workers' Compensation Appeal Board (Philadelphia Coca-Cola), __ A.3d___(Pa. Commw., No. 218 C.D. 2019, filed May 22, 2019), and its holding with respect to an injured worker's incarceration following a conviction under Section 306(a.1) of the Pennsylvania Workers' Compensation Act. I noted that the court also addressed a significant issue regarding the calculation of the claimant's average weekly wage, which was beyond the scope of that article. Given the significance of the court's holding on the average weekly wage issue, reviewing the case again in light of the average weekly wage issue is warranted.

Sadler concerned a claimant who sustained an amputation of his right pinky finger and injured his back in July 2012. A converted notice of temporary compensation payable acknowledged the injury, and reflected a weekly compensation rate of $652, based upon an average weekly wage of $978. In April 2015, the claimant filed a review petition, alleging that his average weekly wage was not calculated properly consistent with Section 309(d.2) of the act and that his average weekly wage should have been no less than $1,412.04, which would have entitled him to the statewide maximum compensation rate in 2012 of $888. The claimant also sought the imposition of penalties for the employer's alleged miscalculation of the average weekly wage.

Section 309(d.2) of the act provides that if an employee has worked less than a complete period of 13 calendar weeks and does not have fixed weekly wages, the average weekly wage is supposed to be calculated by taking the hourly wage rate and multiplying it by by the number of hours per week the employee was expected to work as per the employment agreement. It was the claimant's contention that since he had worked fewer than 13 weeks, he should have been paid consistent with what he believes he was promised at the time of hire.

At a hearing before the workers' compensation judge, the claimant testified that at the time of his injury, he had been working for employer for about four weeks. He was paid at an hourly wage of $24.45, usually working for 10 hours a day, six days a week. According to the claimant, upon being hired, he met with a representative of the employer who told the claimant that he was to expect 60 hours of work per week, under the above-referenced terms. The claimant further testified that he did, in fact, work overtime every week he was employed and that he was promised in excess of 60 hours during the summer moths. The statement of wages filed by the employer only reflected a 40-hour work week.

For its part, the employer presented a witness who testified that he had hired the claimant to work a normal workload of four 10-hour shifts, with the additional understanding that during the busy season, employees would work an extra one or two 10-hour shifts. It just so happens that the claimant was hired during the busy season, which was considered the summer months, and that while overtime, which was paid at time and a half, was all but guaranteed during this busy season, it was not necessarily available the rest of the year.

The  workers' compensation judge denied the review petition regarding the claimant's efforts to get the average weekly wage amended. The WCJ credited pay stubs that had been submitted into evidence, which the judge found to be the most reliable reflection of the agreed-upon expectation of the parties. Simply put, the pay stubs did not support the claimant's testimony, so the WCJ rejected it. In accepting the employer's witness' testimony, the WCJ found that he was in the best position to know the terms of employment for people hired in the claimant's department.

The matter was appealed to the Workers' Compensation Appeal Board, which modified the decision on the incarceration issue. However, with respect to the issue of the claimant's average weekly wage, the board affirmed the WCJ's decision and further dismissed the penalty issue, which had not been addressed by the WCJ, as moot.

On appeal to the Commonwealth Court, the claimant argued that the WCJ incorrectly calculated his average weekly wage because the employer failed to present substantial evidence that he was expected to only work 40 hours per week, and in fact, his pay stubs are consistent with accepted evidence that the claimant was required to, work at least some overtime, since the checks documented that the claimant averaged 50.68 hours of work prior to his injury. The employer argued that the WCJ properly determined the claimant's average weekly wage using Section 309(d.2) of the Workers' Compensation Act using the credited testimony of the employer's witness.

The court began its analysis by appealing to Section 309(d.2) above, dealing with injured workers who are employed for less than 13 calendar weeks and had no fixed weekly wages, and appropriately notes that the question of how many hours a claimant was expected to work per week is a question of fact for the WCJ. Crucial to the result, however is the court's acknowledgment that factual findings must be supported by substantial evidence.

According to the court, the problem with the WCJ's decision is that while the she credited the employer's witnesses' testimony and evidence that the “claimant was hired to work a 40-hour work week with probable overtime during the busy season,” the WCJ did not account for any award of overtime in calculating the claimant's average weekly wage. The court agreed with the claimant that the WCJ improperly used the checks to calculate the expected earnings, especially since they demonstrated consistent overtime, in keeping with the credited testimony of record. Essentially, both the  accepted employer testimony and the other evidence showed that the claimant worked overtime for every completed week. This was contrary to the WCJ's conclusions.

The court noted: “We have required that overtime be taken into account when calculating a claimant's average weekly wage under Section 309(d.2), see Lahr Mechanical, 933 A.2d at 1101-02, and therefore the WCJ erred when she did not do so.” Specifically, the court found that to determine the hours the claimant actually worked “on average,” a  calculation to “reflect the  economic reality of  …  the claimant's recent pre-injury earning experience” is required. The court felt that that the WCJ's calculation in the Sadler case did not do that and consequently remanded the case to the WCJ to recalculate the claimant's average weekly wage, being sure to take into account that the claimant was expected to work overtime during the summer, by all accounts.

Let the Sadler case be a lesson that one should never accept the average weekly wage assigned to a case. The claimant's attorney should always analyze the wage to determine its accuracy. This is especially true where the claimant has not worked a full 13-week period. What the claimant “was expected” to earn can be open to dramatic differences in interpretation.

Christian Petrucci, of the Law Offices of Christian Petrucci, concentrates his practice in the areas of workers' compensation and Social Security disability. He also counsels injured workers in matters involving employment discrimination and unemployment compensation benefits.