Which benefit should not be considered when calculating average weekly earnings?

Which benefit should not be considered when calculating average weekly earnings?

• A. Tips
• B. Wages
• C. Medical Benefits
• D. Overtime

Answer: (C)

Average weekly earnings are based on what the worker actually earned from labor in a recent period, not on benefits provided. In California workers’ compensation, AWE uses the employee’s wages, overtime, and tips (including regular earnings and other forms of direct labor compensation) earned during a 13-week look-back before the injury. Medical benefits are not wages—they’re payments for medical care—so they don’t reflect labor compensation and should not be included in the calculation. That’s why medical benefits are the item that should not be considered.

Average weekly earnings are based on what the worker actually earned from labor in a recent period, not on benefits provided. In California workers’ compensation, AWE uses the employee’s wages, overtime, and tips (including regular earnings and other forms of direct labor compensation) earned during a 13-week look-back before the injury. Medical benefits are not wages—they’re payments for medical care—so they don’t reflect labor compensation and should not be included in the calculation. That’s why medical benefits are the item that should not be considered.