North Carolina’s Supreme Court ruled Wednesday that an employer does not have to include contributions to employee retirement accounts when calculating a workers compensation average weekly wage benefit award.
The decision in Curry Shaw vs. U.S. Airways Inc. stems from a back injury Mr. Shaw suffered in 2000 while lifting luggage, court records state. The employer and its insurer, American Protection Insurance Co., admitted Mr. Shaw was entitled to workers comp benefits and calculated his average weekly wage to be $826.
But that amount excluded the employer’s contributions to a pension plan and a savings plan. Including those contributions would have raised his average weekly wage by $52. When Mr. Shaw appealed, a workers compensation commission ruled the pension and savings contributions were fringe benefits that did not have to be included in his average weekly wage.
The appeals court reversed that decision, and the defendants appealed to the state Supreme Court, arguing that the savings and pension contributions are fringe benefits and not earnings.
Based on the plain language of North Carolina law, the high court reversed the appeals court decision and held “that employer contributions to an employee’s retirement accounts are not included in the calculation of the employee’s average weekly wage.”