A lot of people believe that the workers’ compensation rate is a set percentage of earnings, but that is not true. Rates are figured as directed by Section 85.36 of the Iowa Code.


There are a number of ways to calculate the weekly workers’ compensation rate, but the most common is using the weekly earnings for the 13 weeks before the date of injury to figure an average gross weekly wage, before any deductions are taken out. That counts straight overtime pay, but not the premium paid for overtime. (For example, if you put in 60 hours in a week, you would be paid for 70 hours; the straight 60 hours would be counted for the purpose of figuring the average weekly wage, but not the extra 10 hours of pay.) There are a number of different rules for others in particular situations, such as those paid monthly, volunteer firefighters and emergency responders, as well as prison inmates injured while working.


It is not uncommon for insurance carriers or administrators to find the hourly wage and simply multiply by 40. If the injured worker has worked any overtime during the 13 weeks, the rate is too low, and the worker is short-changed. Of course, at times, the worker has worked less than 40 hours, but if the worker is supposed to work 40 hours a week, those short weeks are usually not supposed to be counted. See Weishaar v. Snap-On Tools Corp., 528 N.W. 2d 177, 181 (Iowa 1998) and Thilges v. Snap-On Tools Corp., 528 N.W.2d 614, 619 (Iowa 1995). In 2003, the Iowa Supreme Court held that a two -week plant shut-down is not to be considered as part of a thirteen-week base wage period. Griffin Pipe Products Co. v. Guarino, 663 N.W.2d 862 (Iowa 2003). See also § 85.36(6) of the Iowa Code.


Also, sometimes out-of-State carriers are unaware that there is a minimum weekly rate provided by Iowa State Law. That rate varies each year, but is currently over $150.00. Please see Section 85.37 of the Iowa Code, or see below.


In another recent decision, favorable to teachers and other school employees, the Iowa Supreme Court found that the insurance carrier must figure the weekly rate, based on the daily pay for the employee, regardless of whether it is paid out in ten or twelve monthly installments. See AEA v. Bauch, 646 N.W.2d 398 (Iowa 2002).


The average weekly wage is then used to look up the proper weekly benefit, based on the workers’ marital status at the time of the injury, and based on the number of children or other dependents living with the worker at the time of the injury.


The worker or the worker’s representative is supposed to be entitled to a copy of the earnings upon which the rate is figured, and if the employer does not produce that within thirty days, it’s actually a criminal simple misdemeanor, punishable by up to 30 days in jail and a $100.00 fine. (Section 85.41 of the Iowa Code) If you ask for those figures, do so in writing, with a date written on the request, and if they don’t respond in time, you can actually contact the County Attorney’s office, and refer them to Sections 85.40 and 85.41 of the Iowa Code. Some County Attorneys will be more responsive than others.


Calculating Weekly Compensation Rates


The following table is merely an illustration of the process for figuring weekly rates. The person doing the figuring starts with the average gross weekly wage. The user then looks up the rate, based on the marital status at the time of the injury, and the number of “exemptions” at the time of injury. A single person without any dependents is Single with 1 exemption. A married worker without dependent children is Married with 2 exemptions. A married worker with two dependent children is Married with 4 exemptions. Using this table, which is from a prior year, a single worker with an average gross weekly wage of $418.00 would be entitled to $258.83. A married worker with two children with an average gross weekly wage of $420.00, would be entitled to $290.90.


Average Weekly Wage ONE TWO THREE FOUR
$418.00 S $258.83 $267.91 $274.77 $281.61
M $266.98 $276.07 282.91 $289.75
$419.00 S $259.41 $268.50 $275.34 $272.18
M $267.55 $276.65 283.5 $290.33
$420.00 S $259.98 $269.06 $275.91 $282.75
M $268.13 $277.22 284.06 $290.90

“85.36 Basis of computation.


The basis of compensation shall be the weekly earnings of the injured employee at the time of the injury. Weekly earnings means gross salary, wages, or earnings of an employee to which such employee would have been entitled had the employee worked the customary hours for the full pay period in which the employee was injured, as regularly required by the employee’s employer for the work or employment for which the employee was employed, computed or determined as follows and then rounded to the nearest dollar:


1. In the case of an employee who is paid on a weekly pay period basis, the weekly gross earnings.

2. In the case of an employee who is paid on a biweekly pay period basis, one-half of the biweekly gross earnings.

3. In the case of an employee who is paid on a semimonthly pay period basis, the semimonthly gross earnings multiplied by twenty-four and subsequently divided by fifty-two.

4. In the case of an employee who is paid on a monthly pay period basis, the monthly gross earnings multiplied by twelve and subsequently divided by fifty-two.

5. In the case of an employee who is paid on a yearly pay period basis, the weekly earnings shall be the yearly earnings divided by fifty-two.

6. In the case of an employee who is paid on a daily or hourly basis, or by the output of the employee, the weekly earnings shall be computed by dividing by thirteen the earnings, not including overtime or premium pay, of the employee earned in the employ of the employer in the last completed period of thirteen consecutive calendar weeks immediately preceding the injury.


If the employee was absent from employment for reasons personal to the employee during part of the thirteen calendar weeks preceding the injury, the employee’s weekly earnings shall be the amount the employee would have earned had the employee worked when work was available to other employees of the employer in a similar occupation. A week which does not fairly reflect the employee’s customary earnings shall be replaced by the closest previous week with earnings that fairly represent the employee’s customary earnings.


7. In the case of an employee who has been in the employ of the employer less than thirteen calendar weeks immediately preceding the injury, the employee’s weekly earnings shall be computed under subsection 6, taking the earnings, not including overtime or premium pay, for such purpose to be the amount the employee would have earned had the employee been so employed by the employer the full thirteen calendar weeks immediately preceding the injury and had worked, when work was available to other employees in a similar occupation. If the earnings of other employees cannot be determined, the employee’s weekly earnings shall be the average computed for the number of weeks the employee has been in the employ of the employer.


8. If at the time of the injury the hourly earnings have not been fixed or cannot be ascertained, the earnings for the purpose of calculating compensation shall be taken to be the usual earnings for similar services where such services are rendered by paid employees.


9. If an employee earns either no wages or less than the usual weekly earnings of the regular full-time adult laborer in the line of industry in which the employee is injured in that locality, the weekly earnings shall be one-fiftieth of the total earnings which the employee has earned from all employment during the twelve calendar months immediately preceding the injury.


a. In computing the compensation to be allowed a volunteer fire fighter, emergency medical care provider, reserve peace officer, volunteer ambulance driver, volunteer emergency rescue technician as defined in section 147A.1, or emergency medical technician trainee, the earnings as a fire fighter, emergency medical care provider, reserve peace officer, volunteer ambulance driver, volunteer emergency rescue technician, or emergency medical technician trainee shall be disregarded and the volunteer fire fighter, emergency medical care provider, reserve peace officer, volunteer ambulance driver, volunteer emergency rescue technician, or emergency medical technician trainee shall be paid an amount equal to the compensation the volunteer fire fighter, emergency medical care provider, reserve peace officer, volunteer ambulance driver, volunteer emergency rescue technician, or emergency medical technician trainee would be paid if injured in the normal course of the volunteer fire fighter’s, emergency medical care provider’s, reserve peace officer’s, volunteer ambulance driver’s, volunteer emergency rescue technician’s, or emergency medical technician trainee’s regular employment or an amount equal to one hundred and forty percent of the statewide average weekly wage, whichever is greater.


b. If the employee was an apprentice or trainee when injured, and it is established under normal conditions the employee’s earnings should be expected to increase during the period of disability, that fact may be considered in computing the employee’s weekly earnings.


c. In computing the compensation to be paid to any employee who, before the accident for which the employee claims compensation, was disabled and drawing compensation under the provisions of this chapter, the compensation for each subsequent injury shall be apportioned according to the proportion of disability caused by the respective injuries which the employee shall have suffered.


Paragraph “c” of this subsection shall not apply to compensable injuries arising under the second injury compensation Act.


d. If the employee was an inmate as defined in section 85.59, the inmate’s actual earnings shall be disregarded, and the weekly compensation rate shall be as set forth in section 85.59.


10. If a wage, or method of calculating a wage, is used for the basis of the payment of a workers’ compensation insurance premium for a proprietor, partner, limited liability company member, or officer of a corporation, the wage or the method of calculating the wage is determinative for purposes of computing the proprietor’s, partner’s, limited liability company member’s, or officer’s weekly workers’ compensation benefit rate.


11. In computing the compensation to be allowed an elected or appointed official, the official may choose either of the following payment options:


a. The official shall be paid an amount of compensation based on the official’s weekly earnings as an elected or appointed official.


b. The earnings of the official as an elected or appointed official shall be disregarded and the official shall be paid an amount equal to one hundred forty percent of the statewide average weekly wage.


12. In the case of an employee injured in the course of performing as a professional athlete, the basis of compensation for weekly earnings shall be one-fiftieth of total earnings which the employee has earned from all employment for the previous twelve months prior to the injury.”

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“85.37 Compensation schedule.

If an employee receives a personal injury causing temporary total disability, or causing a permanent partial disability for which compensation is payable during a healing period, compensation for the temporary total disability or for the healing period shall be upon the basis provided in this section. The weekly benefit amount payable to any employee for any one week shall be upon the basis of eighty percent of the employee’s weekly spendable earnings, but shall not exceed an amount, rounded to the nearest dollar, equal to sixty-six and two-thirds percent of the statewide average weekly wage paid employees as determined by the department of workforce development under section 96.19, subsection 36, and in effect at the time of the injury. However, as of July 1, 1975; July 1, 1977; July 1, 1979; and July 1, 1981, the maximum weekly benefit amount rounded to the nearest dollar shall be increased so that it equals one hundred percent, one hundred thirty-three and one-third percent, one hundred sixty-six and two-thirds percent, and two hundred percent, respectively, of the statewide average weekly wage as determined above. Total weekly compensation for any employee shall not exceed eighty percent per week of the employee’s weekly spendable earnings. The minimum weekly benefit amount shall be equal to the weekly benefit amount of a person whose gross weekly earnings are thirty-five percent of the statewide average weekly wage, or to the spendable weekly earnings of the employee, whichever are less.

Such compensation shall be in addition to the benefits provided by sections 85.27 and 85.28.”


Weekly Comp Rate

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Workers' Compensation and Social Security Disability