The Indiana Worker’s Compensation Board properly included a warehouse supervisor’s two bonuses in its calculation of his average weekly wages because those bonuses were awarded within the 52-week period preceding the injury, a timeframe established by statute, the Indiana Court of Appeals has ruled. The appellate court also remanded the worker’s comp case for an increase in the supervisor’s award.
After being promoted to warehouse supervisor for Midwest Equipment & Supply Co. in 2013, James Garwood received a $20,000 profit sharing bonus. Garwood then received a $1,750 shipping bonus a few months later.
Shortly after receiving his second bonus, Garwood was injured at work and filed a claim for worker’s compensation benefits. Midwest calculated Garwood’s average weekly wages based on the regular wages he earned in the 52 weeks preceding his injury, but did not include his bonuses in the calculation.
Garwood then filed for adjustment of his claim, and both an individual member of the Worker’s Compensation Board and the full board determined the two bonuses should have been included in the calculation of his average weekly wages. As a result, the board awarded Garwood additional benefits, prompting Midwest’s instant appeal in Midwest Equipment & Supply Co. v. James Garwood, 93A02-1705-EX-1140.
Midwest argued on appeal that the board erred in including the bonuses in the calculation, but Indiana Court of Appeals Judge John Baker disagreed in a Thursday opinion. Baker, writing for a unanimous appellate panel, said there is nothing in the Worker’s Compensation Act that excludes a bonus already awarded to an employee from being considered as part of the employee’s average weekly wages.
Though Midwest argued that the fact that Garwood’s bonuses were not governed by a written agreement and were awarded through discretionary decisions should exclude them from consideration in the calculation, Baker said the Worker’s Compensation Act defines “average weekly wages” as the employee’s earning during the 52 weeks immediately preceding the injury.
“It is undisputed that Garwood received his bonuses during the fifty-two weeks that immediately preceded his injury,” Baker wrote. “To require any additional conditions would go beyond the express language of the statute.”
Instead, the appellate panel determined Garwood’s award should be increased by 5 percent under Indiana Code section 22-3-4-8(f), which holds that, “(a)n award of the full board affirmed on appeal, by the employer, shall be increased thereby five percent…and by order of the court may be increased by 10 percent… .” Garwood had argued his award should be increased by 10 percent under that statute because the appeal was frivolous, but the court disagreed, noting it was addressing an issue of first impression.
Thus, the panel remanded the case for the 5 percent increase.