The New Mexico Court of Appeals recently addressed how to calculate an employee's average weekly wages for purposes of workers' compensation, when the employee was injured on one job but worked two unrelated, overlapping jobs of unequal duration. See Vinyard v. Palo Alto, Inc. d/b/a Pizza Hut, 2013-NMCA-001.
The employee was injured on the job delivering pizza for Pizza Hut, but also worked a side job as a horse trainer for his family's business. For purposes of workers comp benefits, "[t]here is no dispute that Worker is entitled to receive compensation benefits reflecting his wages from both jobs," but the parties "vigorously disputed how to compute the aggregate weekly wage to be used to determine the value of those benefits."
The employee--and the Workers Comp Mediator--had suggested an "asymmetric" calculation option, which would take the weekly average of both the 9 weeks as pizza delivery and the 14 weeks as horse trainer, and then aggregate the two averages. However, the WCJ rejected this method because it counted time with another employer. Concluding there was "no controlling authority" for dealing with this situation, the WCJ instead calculated average weekly wages based only on the nine week period that weekly wages of the two jobs overlapped.
The Court reversed the Workers Comp Judge (WCJ). It noted that "[t]he purpose of the Workers' Compensation Act is to compensate an injured employee for the reduction of his earning capacity," and "[f]airness mandates compensating the worker according to what he would have earned in total had he not been injured." Thus, a fair calculation of wages should "eliminate influences that might inflate or deflate the wage from an fair average," such as "periods of unusually high or low wages," that "unfairly benefit or prejudice the worker."
Nonetheless, "where a worker had concurrent employment and where the injury arose in the course of only one job, the worker was entitled to compensation for his entire loss of earning capacity in both jobs." Moreover, "the employer on whose job site the injury occurred would be solely responsible for the worker's compensation based on the aggregate of the worker's average wages with both employers."
In this case, the Court concluded, "[t]he WCJ's mistake was in going outside of Subsection (B) in choosing a shorter number of weeks Worker was employed by Employer (Pizza Hut) when computing the total wages earned in both jobs ... The WCJ's incorrect legal conclusion turned on the determination that any calculation under Subsection (B) was 'not appropriate' and that the average weekly wage could not be 'fairly calculated' simply 'because of multiple employers.'" The Court noted that the WCJ did not address why his own calculation resulted in a more fair result.
The Court held that "under a typical concurrent employment situation such as this case , each employer's average weekly wage is to be individually determined according to Subsection (B)(1), and an average weekly wage based on the aggregate of all averages should then be calculated."
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