Hite v. Evart Products Co.

191 N.W.2d 136, 34 Mich. App. 247, 1971 Mich. App. LEXIS 1601
CourtMichigan Court of Appeals
DecidedJune 21, 1971
DocketDocket 8358
StatusPublished
Cited by31 cases

This text of 191 N.W.2d 136 (Hite v. Evart Products Co.) is published on Counsel Stack Legal Research, covering Michigan Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hite v. Evart Products Co., 191 N.W.2d 136, 34 Mich. App. 247, 1971 Mich. App. LEXIS 1601 (Mich. Ct. App. 1971).

Opinions

Kelley, J.

In August, 1960, plaintiff received an injury which, arose out of and in the course of her employment by defendant, and which caused the industrial loss of the use of her left hand. She had six children dependent on her for support. Disputes arose over the amount of plaintiff’s average weekly wage and as to whether she was entitled to mileage and meal allowances in travelling to secure necessary medical care.

After a hearing the referee refused to consider alleged fringe benefits totalling $7.91, determined plaintiff’s average weekly wage to be $60, and allowed only a part of the claimed travel expenses.

On appeal the Workmen’s Compensation Appeal Board modified the referee’s decision by including in plaintiff’s average weekly wage the value of pension and group insurance payments, but affirmed rejection of the value of vacation and holiday pay. The appeal board also affirmed the referee’s award of 8 cents per mile for travel and awarded an additional $1.25 per trip as a meal allowance.

Plaintiff was granted leave to appeal to this court. Defendant cross-appealed. Apparently no appellate court of this State has decided the issues presented.

The Workmen’s Compensation Act, as other statutes, should be construed reasonably in the light of the purpose which it seeks to accomplish. Benjamin v. Huntington Woods (1957), 349 Mich 545, 555. Our task, therefore, is to determine the purpose of the Act and then to apply the test of reasonableness.

Upon its enactment, the compensation act was proclaimed as a means of determination of right to com[252]*252pensation of workmen for industrial injuries upon the basis of trade risks relating to the industry, to be charged against it as part of the cost. Sheppard v. Michigan National Bank (1957), 348 Mich 577, 579. The theory of the act is that the consuming public, not charity, public or private, must foot the bill for work-incurred injuries. Crilly v. Ballou (1958), 353 Mich 303, 308. In order to carry out the legislative intent and to construe the act properly, its humanitarian objectives and beneficent purposes1 must be kept in mind, and “compensation” must be understood in its broader sense. Munson v. Christie (1935), 270 Mich 94, 99.

I. In determining an employee’s weekly wage for the purpose of workmen’s compensation should the value of remuneration in the form of vacation pay, holiday pay, and the employer’s contributions to insurance and pension plans be included?

The applicable portion of the workmen’s compensation law2 in effect in 1960 provided:

“The weekly loss in wages referred to in this act shall consist of such percentage of the average weekly earnings of the injured employee computed according to the provisions of this section as shall fairly represent the proportionate extent of the impairment of his earning capacity in the employment in which he was working at the time of the injury, the same to be fixed as of the time of the injury, but to be determined in view of the nature and extent of the injury. * # * The compensation payable, when added to his wage earning capacity after the [253]*253injury in the same or another employment, shall not exceed his average weekly earnings at the time of such injury.
“The term ‘average weekly wage’, as used in this act, is defined to be the weekly wage earned by the employee at the time of his injury but in no case less than 40 times his hourly rate of wage or earning.”

Faced with the problem of construction of a similar statute, the enlightened court of another state determined that “wage” or “earnings” must be deemed to include all items of compensation or advantage agreed upon in a contract of hiring which are measurable in money, whether in the form of cash or as an economic gain to the employee. Leslie v. Reynold (1956), 179 Kan 422, 430 (295 P 2d 1076, 1083). We approve this definition.

Testimony of defendant’s personnel manager established that pursuant to her employment contract, plaintiff received her weekly pay plus additional benefits of a weekly dollar value as follows:

Pension payment $2.60
Group insurance 2.63
Vacation pay 1.13
Holiday pay 1.55
Total $7.91

All these have ceased because of the injury.

(a) Pension Payment

For each week of plaintiff’s employment her employer paid $2.60 into a pension fund for her benefit. After ten years of employment plaintiff would have obtained a vested interest in the fund.

Defendant argues that this item should not be considered because plaintiff, who began work less than two years before the injury, had contributed nothing to the fund and had no interest in it at the time of her injury.

[254]*254The earning capacity of an employee who completes the tenth year of employment and thus becomes eligible for the pension, does not thereby suddenly increase by $2.60 or by the amount of a periodic pension payment. On the contrary, during the ten years of work the $2.60 per week reflects the employee’s service and worth, and therefore, increased wage capacity, accruing credits that convert to subsequent pension benefits.

We may only speculate whether plaintiff would have worked a full ten years for defendant had she not been injured. However, the facts are that at the time of the injury her employer was putting aside this potential benefit for her and that the injury prevented a continuation of this potential toward a vested interest. As the result of her injury she must find some other way of providing income for retirement. The pension payment was a part of her weekly wage.

(b) Group Insurance

For each week of plaintiff’s employment the defendant contributed $2.63 as one-half of the premium for a group plan which provided insurance coverage for the plaintiff. Plaintiff paid the other half of the premium.

The defendant argues that because the plaintiff has not chosen to pay her share of the premium after her injury, she should not be given credit in the form of increased compensation benefits. This contention cannot be sustained.

Had the employer not made these weekly payments, plaintiff, in order to provide the same protection, would have been required to pay premiums therefor out of her own funds. These payments by the defendant are likewise included in plaintiff’s weekly wage.

[255]*255(c) Vacation and Holiday Pay

Each year on seven holidays and for a one-week vacation period, defendant company would close hut would pay its employees the usual weekly pay. An official of defendant company translated into dollars and cents the vacation and holiday pay which plaintiff received in addition to her weekly pay check. The total was $2.68 per week.

Plaintiff claims these items represent part of her compensation for the days on which she actually worked, and, therefore, should he included.

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Bluebook (online)
191 N.W.2d 136, 34 Mich. App. 247, 1971 Mich. App. LEXIS 1601, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hite-v-evart-products-co-michctapp-1971.