OPINION
Opinion delivered by
YAZZIE, Chief Justice.
This is an appeal from an August 11, 1992 decision of the Navajo Nation Workmen’s Compensation/Employees’ Benefits Review Board. The Court has jurisdiction over the appeal pursuant to the Navajo Nation Workmen’s Compensation Act, 15, N.T.C. § 1011(b).
I
Ray Joe Jr. is a mechanic who suffered two work place injuries while he was employed by the Navajo Agricultural Products Industry. The first injury, to the back, occurred on May 9, 1986. Joe received $8,000 compensation for it. The second injury, also to the back, occurred on March 24, 1987, when Joe suffered a back “twist” while removing an engine from a road grader with a hoist. The second injury is the subject of this appeal.
Joe applied for benefits under the Act, and received medical and indemnity payments while he was unemployed as the result of his injury. On May 10,1990, Joe went to Dr. Thomas C. Fleming, M.D., for an independent medical examination. Dr. Fleming determined that the second injury was an aggravation of the first, and assessed a “5% permanent impairment rating.” On the basis of that rating, the Navajo Nation Workmen’s Compensation Program valued Joe’s injury and offered a final settlement of $1,748.63. The Program arrived at that figure by multiplying an hourly wage ($6.00) times average work hours per week (46.63) times 125 weeks times five percent. That formula is based upon the statutory provision for nonscheduled permanent impairments, which requires a calculation of the percentage of total disability. 15 N.T.C. § 1049 (c).
[67]*67Joe was dissatisfied with the Program’s determination and rejected the offer of payment. He then filed a claim with the Board arguing that the Act requires compensation in accordance with the claimant’s level of disability, not his level of physical impairment. The five percent rating measured Joe’s physical limitations alone; it did not compute the vocational effects of the injury. In his appeal brief, Joe explains that a “disability” “includes consideration of vocational factors and actual ability to engage in work activity.” A “physical impairment” “is simply a medical measurement of the physical effects of an injury, without considering any resulting consequence.” Appellant’s Brief at 3.
The Board considered Joe’s argument and concluded that it could not consider vocational factors and the actual ability to engage in work activity when making an award under 15 N.T.C. § 1049. The Act does not define “disability” or “impairment,” and the Board could not glean the intent of the Navajo Nation Council when it enacted the benefits provision of the Act at 15 N.T.C. § 1049. There are numerous definitions of the term “disability” in other social security laws (i.e. laws which provide benefits for various incapacities from gainful employment). The Board chose to read the terms “disability” and “impairment” as meaning the same thing when construing section 1049, and concluded that “disability” means “lost of total body function.” 15 N.T.C. § 1049(e). It concluded that the Act does not allow consideration of nonphysical matters, or a “disability” as defined by Joe, to calculate benefits for a nonscheduled permanent partial disability. A physical impairment rating can be determined “within reasonable certainty.” The Board chose to accept the five percent impairment rating on that basis, and it awarded $1,748.63 as compensation for Joe’s back injury.
II
The issue is whether the Board correctly construed the Navajo Nation Workmen’s Compensation Act to require use of a medical impairment rating, or whether the Board should have considered Joe’s education, training and experience when making an award.
Ill
The standard of review in this appeal, from a decision of a Navajo Nation administrative agency exercising quasi-judicial authority, is whether its decision was based upon a mistake as to the applicable law. Navajo Skill Center v. Benally, 5 Nav. R. 93, 96 (1986). The more specific question presented to this Court is whether principles of statutory construction support the Board’s approach.
A fundamental canon of statutory construction is that a statute cannot be read by taking legal terms out of their proper context. Joe focuses upon the term “disability,” advocating a vocational standard for benefits, without reference to the overall scheme of the statute. Social security statutes such as the Act must be read in light of their purpose, and the intent of the Navajo Nation Council is [68]*68ascertained by reading the statute as a whole. What was the intent of the Navajo Nation Council?
Worker’s compensation laws1 are a compromise. They give injured workers a remedy for work place injuries in place of a right to sue an employer. The remedy is liberally construed in favor of the worker, but the tradeoff is limitations upon benefits.
“[T]he Navajo Tribe of Indians is, in fact, a sovereign nation for the purposes of workmen’s compensation, governed by the laws as set forth by the Navajo Tribal Council and ... no other workmen’s compensation law is applicable.” 15 N.T.C. § 1003(a). The Navajo Nation previously participated in worker’s compensation programs as a self-insured employer. Under this approach, the employer sets aside reserves to pay for claims rather than purchase insurance or participate in a state fund through contributions.
The history of the Act clearly shows that the Council intended to perpetuate a self-insurance approach, creating a fund to pay benefits from contributions by Navajo Nation agencies, entities, and industries. But, the self-insurance approach is limited by the ability of covered employers to contribute funds. The reality is a major factor when construing compensation for injuries.
The Act addresses scheduled and non-scheduled injuries. A “scheduled” injury provides for the loss or loss of use of a member of the body. 15 N.T.C. § 1049(b). A “nonscheduled” injury is one which is not specifically listed, and “[f]or other nonscheduled, permanent impairments, a calculation of percentage of total permanent disability is made.” 15 N.T.C. § 1049(c).
The parties advised the Court that the drafter of our Act relied upon a standard worker’s compensation text as a drafting model. That is apparent from the body of the benefits section, which explains the approach to nonscheduled permanent impairments. It is:
that the effect on earning capacity is a conclusively presumed one instead of a specifically proven one based on the individual’s actual wage loss experience. The effect must necessarily be a presumed one, since it would be obviously unfair to appraise the impact of a permanent injury on earning capacity by looking at the employee’s earning record for some relatively short temporary period preceding the compensation award. The alternative is to hold every compensation case involving any degree of permanent impairment open for a lifetime, making specific calculations of the effect of the impairment on the employee’s earnings each time the employee contends that his earnings are being adversely affected.
15 N.T.C. § 1049(c). This approach addresses unscheduled or more generalized impairments, “which are rated on the percentage of disability (loss of total body function) of the entire body, from the scheduled amount for permanent total disability.” 15 N.T.C. § 1049(e).
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OPINION
Opinion delivered by
YAZZIE, Chief Justice.
This is an appeal from an August 11, 1992 decision of the Navajo Nation Workmen’s Compensation/Employees’ Benefits Review Board. The Court has jurisdiction over the appeal pursuant to the Navajo Nation Workmen’s Compensation Act, 15, N.T.C. § 1011(b).
I
Ray Joe Jr. is a mechanic who suffered two work place injuries while he was employed by the Navajo Agricultural Products Industry. The first injury, to the back, occurred on May 9, 1986. Joe received $8,000 compensation for it. The second injury, also to the back, occurred on March 24, 1987, when Joe suffered a back “twist” while removing an engine from a road grader with a hoist. The second injury is the subject of this appeal.
Joe applied for benefits under the Act, and received medical and indemnity payments while he was unemployed as the result of his injury. On May 10,1990, Joe went to Dr. Thomas C. Fleming, M.D., for an independent medical examination. Dr. Fleming determined that the second injury was an aggravation of the first, and assessed a “5% permanent impairment rating.” On the basis of that rating, the Navajo Nation Workmen’s Compensation Program valued Joe’s injury and offered a final settlement of $1,748.63. The Program arrived at that figure by multiplying an hourly wage ($6.00) times average work hours per week (46.63) times 125 weeks times five percent. That formula is based upon the statutory provision for nonscheduled permanent impairments, which requires a calculation of the percentage of total disability. 15 N.T.C. § 1049 (c).
[67]*67Joe was dissatisfied with the Program’s determination and rejected the offer of payment. He then filed a claim with the Board arguing that the Act requires compensation in accordance with the claimant’s level of disability, not his level of physical impairment. The five percent rating measured Joe’s physical limitations alone; it did not compute the vocational effects of the injury. In his appeal brief, Joe explains that a “disability” “includes consideration of vocational factors and actual ability to engage in work activity.” A “physical impairment” “is simply a medical measurement of the physical effects of an injury, without considering any resulting consequence.” Appellant’s Brief at 3.
The Board considered Joe’s argument and concluded that it could not consider vocational factors and the actual ability to engage in work activity when making an award under 15 N.T.C. § 1049. The Act does not define “disability” or “impairment,” and the Board could not glean the intent of the Navajo Nation Council when it enacted the benefits provision of the Act at 15 N.T.C. § 1049. There are numerous definitions of the term “disability” in other social security laws (i.e. laws which provide benefits for various incapacities from gainful employment). The Board chose to read the terms “disability” and “impairment” as meaning the same thing when construing section 1049, and concluded that “disability” means “lost of total body function.” 15 N.T.C. § 1049(e). It concluded that the Act does not allow consideration of nonphysical matters, or a “disability” as defined by Joe, to calculate benefits for a nonscheduled permanent partial disability. A physical impairment rating can be determined “within reasonable certainty.” The Board chose to accept the five percent impairment rating on that basis, and it awarded $1,748.63 as compensation for Joe’s back injury.
II
The issue is whether the Board correctly construed the Navajo Nation Workmen’s Compensation Act to require use of a medical impairment rating, or whether the Board should have considered Joe’s education, training and experience when making an award.
Ill
The standard of review in this appeal, from a decision of a Navajo Nation administrative agency exercising quasi-judicial authority, is whether its decision was based upon a mistake as to the applicable law. Navajo Skill Center v. Benally, 5 Nav. R. 93, 96 (1986). The more specific question presented to this Court is whether principles of statutory construction support the Board’s approach.
A fundamental canon of statutory construction is that a statute cannot be read by taking legal terms out of their proper context. Joe focuses upon the term “disability,” advocating a vocational standard for benefits, without reference to the overall scheme of the statute. Social security statutes such as the Act must be read in light of their purpose, and the intent of the Navajo Nation Council is [68]*68ascertained by reading the statute as a whole. What was the intent of the Navajo Nation Council?
Worker’s compensation laws1 are a compromise. They give injured workers a remedy for work place injuries in place of a right to sue an employer. The remedy is liberally construed in favor of the worker, but the tradeoff is limitations upon benefits.
“[T]he Navajo Tribe of Indians is, in fact, a sovereign nation for the purposes of workmen’s compensation, governed by the laws as set forth by the Navajo Tribal Council and ... no other workmen’s compensation law is applicable.” 15 N.T.C. § 1003(a). The Navajo Nation previously participated in worker’s compensation programs as a self-insured employer. Under this approach, the employer sets aside reserves to pay for claims rather than purchase insurance or participate in a state fund through contributions.
The history of the Act clearly shows that the Council intended to perpetuate a self-insurance approach, creating a fund to pay benefits from contributions by Navajo Nation agencies, entities, and industries. But, the self-insurance approach is limited by the ability of covered employers to contribute funds. The reality is a major factor when construing compensation for injuries.
The Act addresses scheduled and non-scheduled injuries. A “scheduled” injury provides for the loss or loss of use of a member of the body. 15 N.T.C. § 1049(b). A “nonscheduled” injury is one which is not specifically listed, and “[f]or other nonscheduled, permanent impairments, a calculation of percentage of total permanent disability is made.” 15 N.T.C. § 1049(c).
The parties advised the Court that the drafter of our Act relied upon a standard worker’s compensation text as a drafting model. That is apparent from the body of the benefits section, which explains the approach to nonscheduled permanent impairments. It is:
that the effect on earning capacity is a conclusively presumed one instead of a specifically proven one based on the individual’s actual wage loss experience. The effect must necessarily be a presumed one, since it would be obviously unfair to appraise the impact of a permanent injury on earning capacity by looking at the employee’s earning record for some relatively short temporary period preceding the compensation award. The alternative is to hold every compensation case involving any degree of permanent impairment open for a lifetime, making specific calculations of the effect of the impairment on the employee’s earnings each time the employee contends that his earnings are being adversely affected.
15 N.T.C. § 1049(c). This approach addresses unscheduled or more generalized impairments, “which are rated on the percentage of disability (loss of total body function) of the entire body, from the scheduled amount for permanent total disability.” 15 N.T.C. § 1049(e).
The Board had a difficult task, because the statute obviously mixes and does [69]*69not adequately separate the concepts of disability and impairment of the bodily function. The Board reasonably interpreted its own statute. The result it reached does not fly in the face of the statute and, read as a whole, it addressees the reality of limited funds and the equal treatment of workers. We sustain its reading of the statute.
IV
This construction of the statute is also in harmony with principles of Navajo common law. At oral argument, the Court raised the question of whether there are Navajo common law principles to construe the Act. There is a Navajo common law of insurance, which is a method of sharing risks. In the past, when a Navajo was injured, he or she could rely upon family and clan members to provide for the necessities of life. If a Navajo was injured by the act of another, the victim could demand nalyeeh, which is a form of compensation or reparation. In either situation, the amount of support owing by the family, clan, or another (including that person’s family and clan) depended upon what they had. Nalyeeh is a form of distributive justice, where the concern is to address need in accordance with resources. Navajos shared the risks of life by giving what they had to those who suffered an injury. What was given depended upon what others actually had.
Likewise, the Navajo Nation has limited resources to compensate its injured workers. We concur with the Board’s decision that it could not consider open-ended “nonphysical matters” or the claimant’s theory of vocational impairment as a “disability,” but must use an approach which provides reasonable certainty. Its decision also conforms with Navajo common law.
We AFFIRM the August 11, 1992 decision of the Workmen’s Compensation/Employees’ Benefits Review Board.