How is my AWW calculated? By the way, what in the world is an AWW? (Part One)
Your indemnity payments in workers' compensation cases are calculated using a formula that governs how much money you are entitled to receive while you are injured. Remember, indemnity is the term that means your lost income or lost wages; also called "wage loss." The formula is relatively simple, but, as usual, there are rules, variations on the rules, exceptions, and then to make it really entertaining, exceptions to the exceptions.
An attorney experienced in workers' compensation can sort out how much money you may be entitled to receive and consulting a lawyer early on in the process should help you not lose money from day-one!
The employer fills out a Notice of Injury or DWC-1 (a lot more on that in later articles) and on it they put down how much you have been earning in a regular week prior to the accident. The adjuster at the workers' compensation insurance company then uses that as an initial guide to set a reserve on the claim which is an estimate of how much they may have to pay out on the case. The adjuster requests from the employer the income numbers from the 13 weeks or 91 days immediately prior to the accident. Based on that information, it is added up and then divided by 13 to come up with your AWW or Average Weekly Wage.
Two thirds of that number (2/3 or 66.667%) is the CR or Compensation Rate. Future blogs will address this concept in greater detail, but our purpose is to keep you informed step by step. For now, you should be aware of the information above and one incredibly important problem. Employers frequently understate your income in order to try to save money on the claim. Adjusters frequently make math errors. Amazingly, those "math errors" frequently underpay the injured worker (claimant). It is very rare that you would get overpaid by the adjuster. Usually, you get underpaid. When that happens your attorney files a PFB or Petition for Benefits on your behalf to get you properly paid.