Still v. Industrial Commission
| Decision Date | 29 June 1976 |
| Docket Number | No. 1,CA-IC,1 |
| Citation | 551 P.2d 591,27 Ariz.App. 142 |
| Parties | Heard STILL, Petitioner, v. The INDUSTRIAL COMMISSION of Arizona, Respondent, D & M Masonry Company, Respondent Employer, Fidelity & Casualty Company of New York, Respondent Carrier. 1357. |
| Court | Arizona Court of Appeals |
Heard Still (Still) was injured while employed as a laborer for D & M Masonry Company (D & M). He filed a claim for workmen's compensation which was accepted by the Fidelity & Casualty Company of New York, the workmen's compensation carrier for D & M. After extensive medical treatment Still was eventually awarded a 25% Disability to his right leg, a scheduled award for partial permanent disability. This determination by the insurance carrier, as well as Still's average monthly wage, was litigated before the Industrial Commission of Arizona. The hearing officer agreed with the insurance carrier's determinations, both as to the extent of disability and as to the calculation of the average monthly wage. The only matter brought to this Court on certiorari is the propriety of the computation of the average monthly wage. We affirm the award of the Industrial Commission.
Still does not quarrel with the computation of the monthly wages he actually received. He urges, however, that in addition to this amount, he is entitled to credit for the amounts of money his employer is required to contribute to a Union Health and Welfare Fund and Pension Fund by virtue of a negotiated contract between the union and various employers, including D & M. The amounts were computed on the basis of twenty cents per hour worked for the Health and Welfare plan and thirty cents per hour worked for the Pension Fund. These funds are paid directly by the employer into union trust funds for these purposes, and it is clear that the employer has no role in determining when, if ever, or to what extent any employee would benefit from these funds. That is a matter between the unions in question and their members. As a matter of fact, Still was, at the time of the hearings before the Industrial Commission, already receiving a union pension. This fact does not alter our conclusion that these fringe benefits paid directly to the union trust funds by the employer are not includable in the computation of Still's average monthly wage at the time of injury, A.R.S. § 23--1041A.
The hearing officer based his decision to exclude the funds on four grounds: (1) Still was not paid the fifty cents per hour by his employer; (2) the amount was not reported by the employer for workmen's compensation premium computations; (3) the amounts were not included by Still in his gross income for federal or state income tax purposes; (4) Still himself was not receiving the fifty cents per hour at the time of his injury, and might never receive the benefits.
We do not believe that the second and third reasons are determinative. While there is authority that the amount of and the computation of premiums for workmen's compensation insurance have some relationship to the basic wage of the employee, Gene Autry Productions v. Industrial Commission, 67 Ariz. 290, 195 P.2d 143 (1948); Powell v. Industrial Commission, 104 Ariz. 257, 451 P.2d 37 (1969), it cannot be seriously contended that the failure of the employer to include items of compensation for purposes of premium computations which would otherwise be considered wages within the meaning of that term as set out in A.R.S. § 23--1041A, supra, would exclude these items from use in calculating a give employee's average monthly wage for workmen's compensation benefits. Matlock v. Industrial Commission, 70 Ariz. 25, 215 P.2d 612 (1950). Similarly, this Court has recently indicated that requirements of federal law, whether they be the minimum wage law or the Internal Revenue Code, either because of the alleged taxable or non-taxable nature of the income, have no direct effect on the determination of average monthly wage under the workmen's compensation laws of Arizona. Harvey Auto Supply Inc. v. Industrial Commission, 25 Ariz.App. 274, 542 P.2d 1154 (1975); Hobbs v. Industrial Commission, 23 Ariz.App. 422, 533 P.2d 1159 (1975); Springer v. Industrial Commission, 23 Ariz.App. 429, 533 P.2d 1166 (1975). See also: Cudahy Packing Company v. Industrial Commission, 7 Ariz.App. 335, 439 P.2d 307 (1968). Accord, re minimum wage, McCrudden v. Venditto Bros. Inc., 103 R.I. 201, 235 A.2d 878 (1967). Contra, re minimum wage law: Trujillo v. Tanuz, 85 N.M. 35, 508 P.2d 1332 (1973).
This is a case of first impression in this jurisdiction. Counsel have referred us to decisions in other jurisdictions bearing on these questions. Regarding the definition of the term 'wages', we have been referred to a federal decision interpreting this term under the National Labor Relations Act. Inland Steel Co. v. National Labor Relations Board, 170 F.2d 247 (7th Cir. 1948). The reasoning of the cases set forth above regarding the Minimum Wage Law and the Internal Revenue Code is applicable in this instance. See also: In the Matter of Victory Apparel Manufacturing Corporation, 154 F.Supp. 819 (D.N.Y., 1957). However, we will look to the Arizona statutes and decisions to make this determination. Harvey, Springer and Hobbs, supra.
Similarly, we find the decisions from other states unpersuasive regarding the fringe benefit issue. Counsel for Still has cited two cases involving fringe benefits not paid directly to the employee. Schumacher v. Schumacher, 67 S.D. 46, 288 N.W. 796 (1939); Hite v. Evart Products Company, 34 Mich.App. 247, 191 N.W.2d 136 (1971). The Court has found two additional decisions involving 'fringe benefits', Texas Employers' Insurance Association v. Metz, 315 S.W.2d 187 (Tex.Civ.App.1958); Bananno v. Employers Mutual Liability Insurance Company of Wisconsin, 229 So.2d 923 (La.App.1974).
Three of the cases are not in point. In Schumacher v. Schumacher, supra, a father-son farm relationship was involved. The son, the employee in question, received room, board, clothing, church dues, washing, life insurance premiums and a share of the crop raised. The primary issues were whether there was an employer-employee relationship, and whether the son was covered by the compensation insurance policy. The question regarding the weekly wage computation, amounting to $7.50 per week, was whether there was evidence to support it. The court concluded that evidence was generally sufficient, without discussing why each item was included, or what the statutory basis for the reasoning was.
The Louisiana court (Bananno, supra), termed meals furnished to cafeteria employees as 'fringe benefits'. A reading of the decision clearly indicates that the meals were part of the wage paid, were furnished directly to the employee, and were in no way fringe benefits of the general type we are here concerned with.
In Texas Employers' Insurance Association v. Metz, supra, the Texas court held that two weeks' vacation pay was includable for purpose of computing the employee's average weekly pay over a 52 week period for workmen's compensation pay. In effect, the court held that the vacation pay was regular pay for purposes of the Texas statutes regarding the computation of average monthly wage. There was no evidence cited as to how the vacation pay was accrued, if it was, or if there was separate funding for the benefit.
The only case which is directly on point is Hite v. Evart Products Company, supra. The question presented to the Michigan court, although broader than the question here, is essentially the same:
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