Accurate average weekly wage calculations are vital when filing a workers’ compensation claim because nearly every component of an injured worker’s financial recovery is based on his or her AWW. In Illinois, there are four methods workers can use to calculate their average weekly wage. The correct method to choose depends on when employment began, how many workdays were lost in the past 52 weeks, and the terms of employment. Some factors, like overtime and bonuses, can make calculating AWW more difficult.
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Methods to Calculate Average Weekly Wage
Method #1 – The total of the actual earnings during the 52 weeks prior to the injury are divided by 52.
Method #2 – If the individual lost more than 5 workdays during those 52 weeks, those lost days must be subtracted from the calculation. These days do not have to be in the same week. Once these days are subtracted from the 52 weeks, the worker would divide the total wages paid by the number of weeks (or partial weeks) the worker earned wages.
Method #3 – If an employee has worked for less than a year, then the total number of weeks worked should be used instead of 52. This is a common method of calculation used by seasonal workers such as landscapers, construction workers, lifeguards, and others who work temporary jobs for 3-4 months during the year.
Method #4 – If a work-related injury happens to an employee who has worked for a short duration of time, say a few weeks or not much more, then the average weekly wage should be calculated by taking the average wages earned by an individual in the same position who also works a similar number of hours per week.
Illinois Department of Employment Security
The Illinois Department of Employment Security adjusts the minimum and maximum weekly benefits every six months. These rates are based on the total wages divided by the total number of employees in the previous six months. This calculation takes into account workers who work every day, and workers who only work a few days. It also excludes all federal workers and those who are self-employed. If an individual is pursuing compensation for death, amputation, the loss of an eye, permanent total disability, or permanent partial disability, it is vital to check these rates when applying for benefits.