Are Bonuses Included in Vermont Workers’ Compensation Wage Calculations?

When you get hurt on the job, one of the first things on your mind is probably how you’re going to pay your bills. Vermont’s workers’ compensation system is designed to replace a portion of your lost wages while you recover, but how exactly is that number calculated? And if you earn bonuses, tips, or overtime on top of your base pay, does any of that count? These are questions that matter a great deal to many working Vermonters, and the answers may surprise you.

How Vermont Calculates Your Average Weekly Wage

The starting point for your workers’ compensation wage benefits is a figure called your Average Weekly Wage, or AWW. Under Vermont Statutes Title 21, § 650(a), your AWW is calculated using your gross earnings during the 26 weeks immediately before your injury, with the goal of capturing what you were truly earning on a typical week. Any weeks in which you worked less than half your normal hours are left out of that calculation, which helps keep the figure accurate and fair.

Once your AWW is established, your wage replacement benefit is set at two-thirds of that amount. So if your AWW comes out to $900, your weekly benefit would be approximately $600. There are both minimum and maximum weekly benefit limits, which the Vermont Department of Labor adjusts annually, so the exact floor and ceiling will depend on your date of injury.

Yes, Bonuses Count, and So Does More

Here is the part many workers do not expect: Vermont law does not just look at your base hourly or salary wages. Your AWW calculation includes bonuses, overtime pay, tips, and even income from a second job. In other words, the state is trying to capture your full economic picture, not just the number on your base paycheck.

This matters more than people often realize. Think about workers in industries where bonuses or tips make up a meaningful part of take-home pay, such as hospitality, construction, sales, or healthcare. If those earnings are not accounted for in your AWW, your wage replacement benefit could significantly understate your real financial loss. Vermont’s inclusion of these income sources is a meaningful protection for workers whose compensation is not simply a flat weekly salary.

That said, the AWW calculation can get complicated quickly, especially if your hours fluctuate, you hold more than one job, or your bonuses are paid irregularly. Getting it right is important because even small errors in the AWW can add up over weeks or months of receiving benefits.

What Else Goes Into the Calculation?

Beyond bonuses and overtime, there are a few other things worth knowing about how Vermont values your wages:

• The market value of employer-provided benefits, such as housing or meals, can also be factored in
• If you work for more than one employer and are injured, wages from your other jobs may be included
• Weeks where you worked less than half your usual hours are excluded, so irregular schedules can affect the final number
• Cost of living adjustments are applied annually on July 1 if you have been receiving weekly benefits for more than six months

Each of these factors can shift your AWW up or down, which is why the calculation deserves careful attention.

Talk to a Vermont Workers’ Compensation Attorney About Your Benefits

If something feels off about the wage calculation in your claim, or if you are unsure whether your bonuses and other income were properly included, that is worth exploring. Errors in AWW calculations do happen, and they can quietly reduce what you receive throughout your recovery. We encourage you to reach out to Vermont workers’ compensation attorneys who can review your situation and make sure your benefits reflect your true earnings. At Sluka Law PLC, we are ready to help you understand your rights and fight for every dollar you are owed. Contact us today for a free, confidential consultation.

Source:

legislature.vermont.gov/statutes/chapter/21/009