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To put it simply, your average weekly wage for the purpose or workers’ compensation benefits is the average amount of money you earned during an average work week prior to being injured. Calculating your average weekly wage properly is very important because a large portion of your workers’ compensation benefits will be paid to you based on your calculated average weekly wage. If your average weekly wage is calculated too low, you may receive less in temporary disability, permanent disability, and dependency benefits.

Let’s take your temporary disability benefits for example. If you are not able to return to work while recovering from your injury, The New Jersey Workers’ Compensation Act entitles you to receive weekly temporary disability benefits in the amount of 70% of your average weekly gross wage during the 6 months preceding your injury. So, if you were earning $10 per hour, 40 hours per week before your injury, your average weekly wage would be $400 and you would be entitled to receive $280 per week in temporary disability benefits. However, if your average weekly wage was estimated to be only $350 per week, you would only be entitled to receive $245 per week.

Your Average Weekly Wage

To calculate your average weekly wage, you simply need to add together the wages you earned each week during the 6 months preceding your injury and divide by 26 (the number of weeks in 6 months). For example, if you earned $500 per week in half of those weeks, but only $475 per week in the other half, your average weekly wage would be $487.50 per week. This is found by adding the 13 weeks of $500 to the 13 weeks of $475 and dividing by 26.

When this does not apply, you simply multiply your rate of pay by the customary number of hours you (or a person employed in the same capacity) would work during an ordinary week at work. For example, if you are bricklayer who is paid $12 per hour and you customarily work 35 hours per week, your average weekly wage would be $420 per week.

If you cannot specify exactly how many hours you worked per week, simply multiply your rate of pay by the number of hours customarily worked by a person employed in the same capacity in your industry or region. If we use the example above and say that in your industry or region, bricklayer customarily works 40 hours per week, your average weekly wage would come to $480 per week.

Other Benefits Included in Your Average Weekly Wage

Other benefits such as board and lodging are included in your average weekly wage if they furnished by your employer as part of your wages. In addition, tips that you earn regularly during the course of your employment and from sources other than your employer are also calculated into your average weekly wage, but only if you have kept regular daily or weekly record of the amounts you received. If you have not kept track of the amount of tips you received, a judge may be required to set an average weekly amount to be added to your average weekly wage.

For more information on calculating your average weekly wage for workers’ compensation purposes in New Jersey, consult with an experienced New Jersey workers’ compensation attorney.