BRB No. 00-0658
STEPHEN S. MERTIG )
)
Claimant-Petitioner )
)
v. )
)
D&M FIBERGLASS SERVICES, ) DATE ISSUED: 03/27/2001 2001
INCORPORATED )
)
Self-Insured )
Employer-Respondent ) DECISION and ORDER
Appeal of the Decision and Order of Daniel A. Sarno, Jr., Administrative Law Judge, United States
Department of Labor.
Gregory E. Camden (Montagna, Klein & Camden L.L.P.), Norfolk, Virginia, for claimant.
Steven H. Theisen (Midkiff & Hiner, P.C.), Richmond, Virginia, for self-insured employer.
Before: SMITH and McATEER, Administrative Appeals Judges, and NELSON, Acting
Administrative Appeals Judge.
PER CURIAM:
Claimant appeals the Decision and Order (98-LHC-1728) of Administrative Law Judge Daniel A. Sarno,
Jr., rendered on a claim filed pursuant to the provisions of the Longshore and Harbor Workers' Compensation Act,
as amended, 33 U.S.C. §901 et seq. (the Act). We must affirm the findings of fact and conclusions
of law of the administrative law judge if they are rational, supported by substantial evidence, and in accordance
with law. O'Keeffe v. Smith, Hinchman & Grylls Associates, Inc., 380 U.S. 359 (1965); 33 U.S.C.
§921(b)(3).
Claimant, who worked as a technician for employer, was earning $12.50
per hour in August 1995 when he declined an additional one dollar per hour
increase in his salary in exchange for coverage under employer's health
insurance policy. In August 1996, claimant dropped his health insurance
coverage with employer and received a one dollar increase in his hourly
wage. On November 3, 1996, claimant suffered a work-related injury to his
back and filed claims under the Act and the Virginia workers' compensation
scheme.[1] Claimant returned to work for
employer for one day on February 10, 1997, but was terminated thereafter.
He subsequently obtained employment with several non-maritime employers.
In his Decision and Order, the administrative law judge determined that
the one dollar per hour claimant declined in favor of health insurance
coverage between August 1995 and August 1996 should not be included in the
calculation of claimant's average weekly wage. Applying Section 10(c) of
the Act, 33 U.S.C. §910(c), the administrative law judge determined
that claimant's average weekly wage was $525.03. The administrative law
judge awarded claimant temporary total disability compensation from November
4, 1996 through May 13, 1997, and temporary partial disability compensation
thereafter. 33 U.S.C. §908(b), (e). Specifically, for each period of
temporary partial disability, the administrative law judge arrived at a
weekly loss in wage-earning capacity by adjusting claimant's post-injury
wages downward by the percentage increase in the National Average Weekly
Wage (NAWW) for each year, in order to account for inflation.
On appeal, claimant challenges the administrative law judge's
calculation of his average weekly wage. Specifically, claimant contends
that the administrative law judge erred by not including the extra one
dollar per hour employer did not pay claimant in exchange for health
insurance benefits during the year preceding his injury. Claimant further
contends that in awarding temporary partial disability compensation, the
administrative law judge erred by failing to make any downward adjustments
in the periods of disability from May 14, 1997 to September 30, 1997.
Lastly, claimant asserts that the administrative law judge erred by not
making the downward adjustments in his post-injury wages by comparing each
increased NAWW with the NAWW in 1996. Employer responds, urging affirmance
of the administrative law judge's decision.
We first address claimant's challenge to the administrative law judge's
average weekly wage calculation. The issue in the instant case is whether the one dollar per hour
claimant did not receive in wages between August 1995 and August 1996, in exchange for coverage under
employer's health insurance policy, should have been included as wages in calculating claimant's average weekly
wage. Section 2(13) of the 1984 Act defines "wages" as:
the money rate at which the service rendered by an employee is
compensated by an employer under the contract of hiring in force at the
time of the injury, including the reasonable value of any advantage
which is received from the employer and included for purposes of any
withholding of tax under subtitle C of the Internal Revenue Code of
1954 (relating to employment taxes). The term wages does not include
fringe benefits, including (but not limited to) employer payments for
or contributions to a retirement, pension, health and welfare, life
insurance, training, social security or other employee or dependent
benefit plan for the employee's or dependent's benefit, or any other
employee's dependent entitlement.
33 U.S.C. §902(13)(1994).[2] Relying
on Universal Maritime Service Corp. v. Wright, 155 F.3d 311, 33 BRBS
15(CRT)(4th Cir. 1998), and Story v. Navy Exchange Service Center,
33 BRBS 111 (1999), claimant asserts that since the value of employer's
health coverage is ascertainable, one dollar per hour, it should have been
included as wages in the calculation of his average weekly wage. We
disagree. Both Wright and Story are inapposite to the instant
case, as those cases concern whether holiday, vacation and container royalty
payments, and tips are properly included as "wages" within the first
sentence of Section 2(13). The instant case concerns whether the value of
employer's health insurance coverage should be included in the calculation
of claimant's average weekly wage. In this regard, the second sentence of
Section 2(13) specifically excludes employer's payments for, or
contributions to, a health and welfare benefit plan. See 33 U.S.C.
§902(13)(1994). Based on the plain meaning of the second sentence of
Section 2(13), we hold that the administrative law judge properly did not
include the value of employer's contributions to claimant's health coverage
as wages in the calculation of claimant's average weekly wage. Accordingly,
the administrative law judge's determination that claimant's average weekly
wage is $525.03 is affirmed.
Next, claimant contends that in determining the amount of temporary
partial disability benefits, the administrative law judge's method of
adjusting claimant's post-injury wages to account for inflation was in
error. Specifically, claimant contends that the administrative law judge
erred by failing to make any downward adjustments in the periods of
disability from May 14, 1997 to September 30, 1997. Moreover, claimant
asserts that the administrative law judge erred by not making the downward
adjustments in his post-injury wages by comparing each increased NAWW with
the NAWW in 1996.
An award for partial disability compensation in a case not covered by
the schedule is based on the difference between claimant's pre-injury
average weekly wage and his post-injury wage-earning capacity. 33 U.S.C.
§908(c)(21), (e), (h); Cook v. Seattle Stevedoring Co., 21 BRBS
4, 6 (1988). Sections 8(c)(21) and 8(h) require that a claimant's post-injury earnings must be adjusted back to the wage level paid at the time of
claimant's injury in order to neutralize the effects of inflation when this
figure is compared to claimant's pre-injury average weekly wage. See
Walker v. Washington Metropolitan Area Transit Authority, 793 F.2d 319,
18 BRBS 100(CRT)(D.C. Cir. 1986); Richardson v. General Dynamics
Corp., 23 BRBS 327 (1990); Bethard v. Sun Shipbuilding & Dry Dock
Co., 12 BRBS 691 (1980). Where, as in the instant case, the actual
wages paid at the time of the injury in claimant's post-injury job are
unknown, the Board has held that the percentage increase in the National
Average Weekly Wage (NAWW) should be applied to adjust a claimant's post-injury wages downward in order to account for inflation. See Quan v.
Marine Power & Equipment Co., 30 BRBS 124 (1996).
In the instant case, we hold that the administrative law judge's
decision to not make any downward adjustments in claimant's post-injury
wages for the three periods of temporary partial disability from May 14,
1997 through September 30, 1997, is rational, as there was no change in the
NAWW from October 1, 1996 to September 30, 1997. For the various periods
of temporary partial disability after September 30, 1997, the administrative
law judge adjusted claimant's post-injury wages by applying the percentage
change in the NAWW for each year, as opposed to aggregating the percentage
change in the NAWW since 1996. See Decision and Order at 7-8.
Contrary to claimant's assertion, the administrative law judge's method of
adjusting claimant's post-injury wages to account for inflation is rational
and in accordance with law. See, e.g., Richardson, 23 BRBS at 331.
We therefore affirm the amount of temporary partial disability compensation
awarded by the administrative law judge for the periods subsequent to
September 30, 1997.
Accordingly, the Decision and Order of the administrative law judge is
affirmed.
SO ORDERED
ROY P. SMITH
Administrative Appeals Judge
J. DAVITT McATEER
Administrative Appeals Judge
MALCOM D. NELSON, Acting
Administrative Appeals Judge
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Footnotes.
1) 1Claimant was awarded temporary total disability
compensation of $373.86 per week from the Virginia Worker's Compensation
Commission from November 4, 1996 through May 13, 1997, and June 26, 1997
though July 1, 1997, based on an average weekly wage of $560.79. He was
awarded temporary partial disability compensation for the period May 14,
1997 through June 25, 1997, and various periods subsequent to July 1,
1997.
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2) 2Section 2(13) as amended in 1984 codifies the holding
of the United States Supreme Court in Morrison-Knudsen Constr. Co. v.
Director, OWCP, 461 U.S. 624, 15 BRBS 155(CRT)(1983). In Morrison-Knudsen, the Court, in construing Section 2(13) prior to the 1984
Amendments, stated that where benefits received are not "money recompensed,"
or "gratuities received from others," the narrow question is whether the
benefits are a "similar advantage" to board, rent, housing, or lodging in
that the benefits have a present value that can be readily converted into
a cash equivalent on the basis of their market value. The Court held that
employer contributions to union trust funds for health and welfare,
pensions, and training were not such "similar advantages." Morrison-Knudsen, 461 U.S. at 630, 15 BRBS at 157(CRT).
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NOTE: This is an UNPUBLISHED LHCA Document.
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