In this video, we’re going to discuss how workers’ compensation is calculated. My name is Matt Eason. I’ve been practicing employment and workers’ compensation law here in the Sacramento Valley for 25 years. One of the first questions clients ask us is how workers’ compensation is calculated?
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To redefine the question, there are actually two different benefits in workers’ compensation that ultimately are calculated. The two types of benefits that need calculations are temporary disability payments and permanent disability payments.
Temporary disability payments are calculated based on two-thirds of your average weekly earnings. When calculating your average weekly earnings, you look at not only what your base pay was but also were you receiving additional incentive pay, were you receiving overtime, or did you have another job that you cannot perform? You take all of those into account, and it’s two-thirds of your average weekly earnings with some statutory maximums.
Many people don’t understand that your permanent disability award is also a calculation based on formulas. Unlike in the personal injury world, you receive a single number based on lost wages, medical bills, and a pain and suffering component. Workers’ compensation instead gives you a permanent disability award based on a calculation of your disabilities. Unfortunately, to determine your disabilities, they are not looking at necessarily your loss of job benefits or your pain; instead, they are looking at your limitations in the workforce.
Permanent disability benefits are calculated based on your limitations in the workforce. The limitations are usually coaxed into terms of what things you can and cannot do or certain requirements you may have. For example, do you have a limitation in walking, standing, or lifting? Then based on those limitations, they categorize the length, amount, or duration of those limitations. Are you limited to 10 pounds or 20 pounds or sometimes or occasionally? Do you have to stand and sit and stand and sit? Those limitations then go into a formula that calculates your percentage of disability rating. That percentage of disability rating goes into another formula that then calculates the amount of money you receive in compensation for your permanent disability.
If you suffered an on-the-job injury in California and you are concerned that you’re not being compensated correctly under the workers’ compensation system, in other words, your temporary disability is not being paid correctly, or your permanent disability is not enough, then we hope you’ll consider reaching out to one of the Sacramento worker compensation lawyers in our firm for a free consultation to help you calculate your permanent disability or temporary disability rates. My name again is Matt Eason. I’m with the law firm of Eason & Tambornini.
