NO. 92-115 IN THE SUPREMECOURT OF THE STATE OF MONTANA 1992
LON GREGORY, Claimant, Respondent and Cross Appellant, -vs- MICHAEL BAILEY & SONS LOGGING, Employer, and STATE COMPENSATIONMUTUAL INSURANCE FUND, Defendant and Appellant.
APPEAL FROM: The Workers' Compensation Court, The Honorable Timothy W. Reardon, Judge presiding.
COUNSEL OF RECORD: For Appellant and Employer: Laurence Hubbard, Attorney at Law, Helena, Montana For Respondent and Cross Appellant: Robert K. Ogg, Grenfell & Ogg, Missoula, Montana
Submitted on Briefs: August 20, 1992 Decided: November 12, 1992
1 Clerk Justice Fred 3. Weber delivered the Opinion of the Court.
This is an appeal from a decision by the Workers' Compensation Court awarding claimant compensation based upon his entire work history with the employer. We affirm. The issue on appeal is whether the Workers' Compensation Court erred in unreasonably calculating claimant's compensation by considering his entire work history with the employer instead of only the immediate preceding four pay periods. Claimant, Lon Gregory (Gregory) was hired as a backhoe operator and laborer by Michael Bailey and Sons Logging (Bailey) in July 1989. Bailey is in the logging business which involves seasonal work. The crew of approximately 40 employees usually do not work in the spring and fall of the year. Most of these employees return after layoff. Employees are paid by the month. Gregory worked from July 1989 until mid-February 1990, when seasonal weather conditions prevented work. He returned to work on June 1, 1990. It is uncontested that Gregory was injured during the course of his employment on August 10, 1990. On August 29, 1991, Gregory filed a petition for hearing before the Workers' Compensation Court alleging that State Compensation Mutual Insurance Fund (State Fund) improperly calculated his "wages" under § 39-71-123, MCA (1989). A hearing was held on November 4, 1991. While responsibility for the injury was uncontested, the Workers' Compensation Court had to calculate the average weekly salary for the purpose of determining compensation.
2 On January 13, 1992, the Workers' Compensation Court issued
its Findings of Fact, Conclusions of Law, and Judgment. The court
determined that Gregory's average weekly wage for purposes of § 39-
71-123, MCA (1989), was $312.00 per week, with a resulting
temporary total disability rate of $208.10 per week. The court
calculated the compensation by using all weekly earnings for the
entire length of time in which Gregory worked for Bailey.
The State Fund appeals this determination. Gregory cross-
appealed with the State Fund responding to the cross-appeal.
State Fund argues that the Workers' Compensation Court
misapplied 5 39-71-123(3), MCA, and that it is appropriate to
adjust a claimant's wage determination to account for the seasonal
nature of his employment where the job is not inherently full time. Further, State Fund argues that a term of employment does not end when a break in employment with the same employer occurs because of
weather conditions or for other reasons of forced idleness. State Fund, therefore, contends that the actual wages earned over the entire span of employment should include off time.
Gregory argues also that the Workers ' Compensation Court erred
in its calculations. Gregory contends that for purposes of determining compensation benefits, the court should have relied on
the hourly calculations of subsection (a) of 5 39-71-123(3), MCA.
Subsection (a) directs that if the "term of employment" for the
same employer is less than four pay periods, a full time employee's
wages are computed by multiplying the hourly rate times the number of weekly hours for which the employee was hired to work. Such
3 calculation, argues Gregory, would mean that during those weeks within the preceding four pay periods in which he did not work for Bailey because of the weather, the court should have used the $400 weekly figure to compute his benefits. This case revolves around the use and interpretation of several statutes. Section 39-71-701, MCA, states: (1) . . . a worker is eligible for temporary total disability benefits when the worker suffers a total loss of wages as a result of an injury and until the worker reaches maximum healing . . . (3) Weekly compensation benefits for injury producing temporary total disability shall be 66 2/3% of the wages received at time of injury . . . Section 39-71-123, MCA, states: (1) "Wages" means the gross remuneration paid in money, or in a substitute for money, for services rendered by an employee . . . (3) For compensation benefit purposes, the average actual earnings for the four pay periods immediately preceding the injury are the employee's wages, except if: (a) the term of employment for the same employer is less than four pay periods, in which case the employee's wages are the hourly rate times the number of hours in a week for which the employee was hired to work: or (b) for good cause shown by the claimant, the use of the four pay periods does not accurately reflect the claimant's employment history with the employer, in which case the insurer may use additional pay periods. The Workers' Compensation Court determined that pursuant to 3 39-71-123(3)(b), MCA, sufficient cause existed for the court to consider additional pay periods beyond the four mentioned in the main body of subsection three. We agree. The Workers' Compensation Court concluded that using Gregory's suggested interpretation and formula would provide him with an average monthly amount of money higher than the total sum of money earned in any of the four preceding months before his injury except 4 one. The court found this to be unfair. Likewise, the Workers'
Compensation Court determined that use of the State Fund's
calculations failed to accurately take into account the seasonal
nature of the logging business by including off time. Therefore,
for the sake of total fairness, the court considered Gregory's
entire employment history with Bailey which constituted 59 weeks of
employment. Of those 59 weeks, Gregory worked 31. The court used
the total number of work hours (967) stipulated to by the parties
and then divided this number by the actual number of weeks worked
(31) * This comes to 31.2 hours per week which the court multiplied
by $10 per hour, Gregory's regular hourly wage, to equal the sum of
$312.00. This sum was then multiplied by 66 2/3 percent for compensation of $208.10 per week. The court determined that this
calculation gave consideration to periods when Gregory worked
little, offset by periods when he worked a disproportionately high
number of hours. We review a Workers' Compensation Court's conclusions of law
as to whether the conclusions are correct. Steer, Inc. v. Dept. of
Revenue (1990), 245 Mont. 470, 803 P.2d 601. Further, "[a]~ long
as the rate of disability fairly and reasonabl[y] approximates the
wages earned at the time of injury, this Court will uphold the
method used by the Workers' Compensation Court to determine a
claimant's usual hours of employment." Stuber v. Moodie Implement
(19891, 236 Mont. 189, 192, 769 P.2d 1205, 1207. Here, the
Workers' Compensation Court took into account the seasonal nature
of the logging business while still basing its calculations on
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NO. 92-115 IN THE SUPREMECOURT OF THE STATE OF MONTANA 1992
LON GREGORY, Claimant, Respondent and Cross Appellant, -vs- MICHAEL BAILEY & SONS LOGGING, Employer, and STATE COMPENSATIONMUTUAL INSURANCE FUND, Defendant and Appellant.
APPEAL FROM: The Workers' Compensation Court, The Honorable Timothy W. Reardon, Judge presiding.
COUNSEL OF RECORD: For Appellant and Employer: Laurence Hubbard, Attorney at Law, Helena, Montana For Respondent and Cross Appellant: Robert K. Ogg, Grenfell & Ogg, Missoula, Montana
Submitted on Briefs: August 20, 1992 Decided: November 12, 1992
1 Clerk Justice Fred 3. Weber delivered the Opinion of the Court.
This is an appeal from a decision by the Workers' Compensation Court awarding claimant compensation based upon his entire work history with the employer. We affirm. The issue on appeal is whether the Workers' Compensation Court erred in unreasonably calculating claimant's compensation by considering his entire work history with the employer instead of only the immediate preceding four pay periods. Claimant, Lon Gregory (Gregory) was hired as a backhoe operator and laborer by Michael Bailey and Sons Logging (Bailey) in July 1989. Bailey is in the logging business which involves seasonal work. The crew of approximately 40 employees usually do not work in the spring and fall of the year. Most of these employees return after layoff. Employees are paid by the month. Gregory worked from July 1989 until mid-February 1990, when seasonal weather conditions prevented work. He returned to work on June 1, 1990. It is uncontested that Gregory was injured during the course of his employment on August 10, 1990. On August 29, 1991, Gregory filed a petition for hearing before the Workers' Compensation Court alleging that State Compensation Mutual Insurance Fund (State Fund) improperly calculated his "wages" under § 39-71-123, MCA (1989). A hearing was held on November 4, 1991. While responsibility for the injury was uncontested, the Workers' Compensation Court had to calculate the average weekly salary for the purpose of determining compensation.
2 On January 13, 1992, the Workers' Compensation Court issued
its Findings of Fact, Conclusions of Law, and Judgment. The court
determined that Gregory's average weekly wage for purposes of § 39-
71-123, MCA (1989), was $312.00 per week, with a resulting
temporary total disability rate of $208.10 per week. The court
calculated the compensation by using all weekly earnings for the
entire length of time in which Gregory worked for Bailey.
The State Fund appeals this determination. Gregory cross-
appealed with the State Fund responding to the cross-appeal.
State Fund argues that the Workers' Compensation Court
misapplied 5 39-71-123(3), MCA, and that it is appropriate to
adjust a claimant's wage determination to account for the seasonal
nature of his employment where the job is not inherently full time. Further, State Fund argues that a term of employment does not end when a break in employment with the same employer occurs because of
weather conditions or for other reasons of forced idleness. State Fund, therefore, contends that the actual wages earned over the entire span of employment should include off time.
Gregory argues also that the Workers ' Compensation Court erred
in its calculations. Gregory contends that for purposes of determining compensation benefits, the court should have relied on
the hourly calculations of subsection (a) of 5 39-71-123(3), MCA.
Subsection (a) directs that if the "term of employment" for the
same employer is less than four pay periods, a full time employee's
wages are computed by multiplying the hourly rate times the number of weekly hours for which the employee was hired to work. Such
3 calculation, argues Gregory, would mean that during those weeks within the preceding four pay periods in which he did not work for Bailey because of the weather, the court should have used the $400 weekly figure to compute his benefits. This case revolves around the use and interpretation of several statutes. Section 39-71-701, MCA, states: (1) . . . a worker is eligible for temporary total disability benefits when the worker suffers a total loss of wages as a result of an injury and until the worker reaches maximum healing . . . (3) Weekly compensation benefits for injury producing temporary total disability shall be 66 2/3% of the wages received at time of injury . . . Section 39-71-123, MCA, states: (1) "Wages" means the gross remuneration paid in money, or in a substitute for money, for services rendered by an employee . . . (3) For compensation benefit purposes, the average actual earnings for the four pay periods immediately preceding the injury are the employee's wages, except if: (a) the term of employment for the same employer is less than four pay periods, in which case the employee's wages are the hourly rate times the number of hours in a week for which the employee was hired to work: or (b) for good cause shown by the claimant, the use of the four pay periods does not accurately reflect the claimant's employment history with the employer, in which case the insurer may use additional pay periods. The Workers' Compensation Court determined that pursuant to 3 39-71-123(3)(b), MCA, sufficient cause existed for the court to consider additional pay periods beyond the four mentioned in the main body of subsection three. We agree. The Workers' Compensation Court concluded that using Gregory's suggested interpretation and formula would provide him with an average monthly amount of money higher than the total sum of money earned in any of the four preceding months before his injury except 4 one. The court found this to be unfair. Likewise, the Workers'
Compensation Court determined that use of the State Fund's
calculations failed to accurately take into account the seasonal
nature of the logging business by including off time. Therefore,
for the sake of total fairness, the court considered Gregory's
entire employment history with Bailey which constituted 59 weeks of
employment. Of those 59 weeks, Gregory worked 31. The court used
the total number of work hours (967) stipulated to by the parties
and then divided this number by the actual number of weeks worked
(31) * This comes to 31.2 hours per week which the court multiplied
by $10 per hour, Gregory's regular hourly wage, to equal the sum of
$312.00. This sum was then multiplied by 66 2/3 percent for compensation of $208.10 per week. The court determined that this
calculation gave consideration to periods when Gregory worked
little, offset by periods when he worked a disproportionately high
number of hours. We review a Workers' Compensation Court's conclusions of law
as to whether the conclusions are correct. Steer, Inc. v. Dept. of
Revenue (1990), 245 Mont. 470, 803 P.2d 601. Further, "[a]~ long
as the rate of disability fairly and reasonabl[y] approximates the
wages earned at the time of injury, this Court will uphold the
method used by the Workers' Compensation Court to determine a
claimant's usual hours of employment." Stuber v. Moodie Implement
(19891, 236 Mont. 189, 192, 769 P.2d 1205, 1207. Here, the
Workers' Compensation Court took into account the seasonal nature
of the logging business while still basing its calculations on
5 "actual" hours worked within the employee's total actual work
history. We have consistently stated that when calculating
compensation, a court should consider the seasonal nature of a job.
Infelt v. Horen (1959), 136 Mont. 217, 346 P.2d 556. Yet,
precedent also exists for not including periods of forced idleness
when computing the average weekly pay. Sandahl v. James A. Slack,
Inc. (1987), 225 Mont. 208, 732 P.2d 831.
The record reveals that Gregory worked at a sporadic, seasonal
job during 31 out of a total of 59 weeks in which he was employed
by Bailey. The record establishes that during his entire
employment with Bailey, Gregory worked only a total of 967 hours
during these 31 weeks. In its calculations, the court excluded the
18 weeks of forced idleness because of weather. The court then
divided the total number of actual hours by the actual number of
weeks worked. Such calculation fairly approximates the average
weekly salary of Gregory.
Because the court had to consider the seasonal nature of a job
and not consider periods of forced idleness, it was required to
look to subsection (b) of § 39-71-123, MCA, when considering a fair
method of calculations under this set of facts. Gregory's argument
pertaining to subsection (a) is inappropriate under this set of
circumstances as reliance on it fails to consider any seasonal
aspect of his employment.
We conclude that where sporadic, seasonal work is at issue, it
is reasonable when calculating "usual" salary to calculate on a
larger scale than four pay periods; therefore, reliance on
6 subsection (b) of § 39-71-123, MCA, is appropriate. Fairness demands that sporadic, seasonal employment be determined in such a way as to "accurately reflect the claimant's employment history with the employer" as subsection (b) dictates. See, Stuber, 236 Mont. at 192. Further, it is inappropriate when determining compensation for a sporadic, seasonal job, to rely on subsection (a) of § 39-71-123, MCA, as such calculations will be unreasonable and unfair. We hold the Workers' Compensation Court did not err in calculating compensation by using claimant's entire work history with the employer instead of only the immediate preceding four pay periods.
We Concur:
7 November12, 1992
CERTIFICATEOF SERVICE
I herebycertify that the following order was sentby United Statesmail, prepaid,to the following named:
LAURENCE HUBBARD, LegalCounsel StateCompensationMutual InsuranceFund 5 SouthLast ChanceGulch Helena,MT 59604-4759
ROBERTK. OGG Grenfell& Ogg 412 West Alder Missoula,MT 59802
ED SMITH CLERK OF THE SUPREMECOURT