Wis.LIRC WC Decision: Hunter - June 21, 2000 - ND � 4.2 - Average Weekly Wage - determining wage of employe who drives employer-provided truck and is paid by the mile with money to cover operating expenses as well as pay

STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

TIMOTHY HUNTER, Applicant

TTC INC, Employer

CREDIT GENERAL INS CO, Insurer

WORKER'S COMPENSATION DECISION
Claim No. 1998064088

An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and order in that decision as its own.

ORDER

The findings and order of the administrative law judge are affirmed.

Dated and mailed June 21, 2000
huntert.wsd : 101 : 5 ND � 4.2

/s/ David B. Falstad, Chairman

Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The applicant worked for the employer as a truck driver for five weeks before sustaining a back injury. At issue before the ALJ were wage and causation. The ALJ resolved both issues in the applicant's favor, finding a compensable injury and a $630.50 average weekly wage. The employer and its insurer (collectively, the respondent) appeal, raising only the wage issue. (1 )

The employer paid the applicant $0.24 per mile to drive its truck. The total of the payments the employer made to the applicant during his employment under that arrangement was $3,159.48. Dividing this by the five weeks of employment comes to approximately $630.50 per week. The applicant's position, adopted by the ALJ, is that that is the average weekly wage.

However, the respondent asserts the wage should be $426.32. While the employer paid the applicant $0.24 per mile to drive the truck, the respondent contends that the applicant's wage for workers compensation purposes should only be based on the rate of $0.16 per mile. Indeed, pursuant to industry practice and the rules of the federal internal revenue service (IRS), the employer only treated the amount generated by a $0.16 per mile rate as taxable "wage" and treated the remaining $0.08 per mile as nontaxable reimbursement for travel expense. The IRS apparently does not care if the employer assigns a cent-per-mile rate to incidental expenses instead of accounting for it directly, so long as the mileage rate works out to less $32 per day.

Using a $02.4 per mile rate, the respondent contends that the payments to the applicant which are properly treated as "wages" totaled only $2,131.61, while the remaining $1,027.87 should be considered non-wage expense reimbursement. Dividing the $2,131.61 by the five weeks of employment equals the lower average weekly wage urged by the respondent, $426.32.

The record also indicates that the employer owns the truck the applicant drives, and that the employer pays for most of the operating expenses such as fuel and repair costs. The employer allowed the applicant to charge fuel on a fuel card, Transcript pages 33 et seq. and 68 et seq., which the employer paid. It also allowed personal advances on the card, which were deducted from the "expense" portion of the applicant's gross payment, unless the applicant turned in receipts establishing that the expense was a repair-related. Transcript, pages 68-69. Thus, as the respondent states in its brief that the point of the $0.08 per mile was to pay for "meals, showers, tolls, laundry, and so forth." Respondent's March 10, 2000 brief, page 5.

Wisconsin Administrative Code � DWD 80.51(2) provides:

"When an employe furnishes his or her truck to the employer and is paid by the employer in gross to include operating expenses, one-third of that gross sum is considered as wages except as a showing is made to the contrary."

In other words, if an injured worker owns the truck and pays the operating expenses, the "wage" is only a third of the mileage rate. The rule is silent on what happens when the employer owns the truck and pays the operating expense.

The respondent essentially is asking the commission to infer a two-thirds wage rule when the employer owns the truck. The commission must decline. Rather, the commission concludes that if the department had intended to use a two-thirds rule for injured truckers who drive employer-owned the trucks, it could have promulgated such a rule to accompany Wis. Admin. Code � DWD 80.51(2). Stated another way, inferring or constructing a rule for employer-owned trucks -- when the department expressly promulgated a rule for worker-owned trucks but not employer-owned trucks -- exceeds the commission's authority. See Wis. Stat. � 103.04(2).

The department's general policy, of course, is that travel expenses are excluded from the wage. Methods of Determining Compensation Wage, part III. E. (rev May 1996). In this case, the respondent does not offer proof of the actual travel expenses it paid, however, but asks the commission to simply infer that one-third of the gross it paid the applicant went to pay the travel expense. Again, the commission lacks the authority to do that.

The commission realizes that the IRS has adopted just such a policy for determining what it considers taxable income. However, an applicant's average weekly wage for workers compensation purposes is not automatically the same as what the IRS considers taxable wages. The commission also understands that it may be unduly burdensome for both employers and the department if actual receipts are required. (2 ) Nonetheless, Wisconsin's workers compensation law simply does not provide the automatic deduction from a worker's "earnings" or "wages" that the employer seeks.

cc: ATTORNEY THOMAS A SIEDOW
PARRONI SIEDOW & JACKSON SC

ATTORNEY LARRY SCHIFANO
THRASHER DOYLE PELISH & FRANTI LTD

[ Search Decisions ] - [ WC Legal Resources ] - [ LIRC Home Page ]

Footnotes:

(1)( Back ) The respondent specifically stated in its petition that it did not challenge the remaining findings. The respondent also states in its brief that it does not feel further hearing is necessary, unless the commission desires it.

(2)( Back ) Respondent's March 10, 2000 brief, page 5. The commission concludes that the point of the respondent's further hearing request was not to produce these receipts.