Gloria Clay v. Our Lady of Lourdes Regional Medical Center, Inc.

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

09-1219

GLORIA CLAY

VERSUS

OUR LADY OF LOURDES REGIONAL MEDICAL CENTER, INC.

**********

APPEAL FROM THE
OFFICE OF WORKERS’ COMPENSATION - # 4
PARISH OF LAFAYETTE, NO. 06-03500
SHARON MORROW, WORKERS’ COMPENSATION JUDGE

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ULYSSES GENE THIBODEAUX
CHIEF JUDGE

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Court composed of Ulysses Gene Thibodeaux, Chief Judge, Jimmie C. Peters, and J.
David Painter, Judges.

REVERSED AND RENDERED.

Philip E. Roberts
Leake & Anderson, L.L.C.
P. O. Drawer Z
Lafayette, LA 70502
Telephone: (337) 233-7430
COUNSEL FOR:
Defendant/Appellee - Our Lady of Lourdes Regional Medical
Center, Inc.

Michael Benny Miller
Miller & Miller
P. O. Drawer 1630
Crowley, LA 70527-1630
Telephone: (337) 785-9500
COUNSEL FOR:
Plaintiff/Appellant - Gloria Clay

THIBODEAUX, Chief Judge.

The claimant/appellant, Gloria Clay, brought a workers’ compensation

claim against her employer, defendant/appellee, Our Lady of Lourdes Regional

Medical Center, Inc. (Lourdes), for injury to her back while lifting solution supplies.

A rehabilitation counselor provided information regarding potential employers.

When Ms. Clay applied for but did not obtain employment, the OWC terminated her

benefits after applying a credit in favor of Lourdes for the wages that Ms. Clay would

have earned had she been employed by a particular employer. Ms. Clay appeals the

termination of her benefits and the calculation of her average weekly wage (AWW)

after the inclusion of fringe benefits.

Where Ms. Clay attempted to obtain all positions suggested, we find that

employment was unavailable to Ms. Clay and that the OWC applied an overly

restrictive interpretation of the applicable law in terminating her benefits. We,

therefore, reverse the judgment terminating Ms. Clay’s benefits. We further find a

misapplication of the statutory and jurisprudential provisions for calculating a

claimant’s AWW and reverse the OWC judgment on that issue as well.

I.

ISSUES

We must decide:

(1) whether the OWC erred in terminating Ms. Clay’s
workers’ compensation benefits; and,

(2) whether the OWC erred in calculating Ms. Clay’s
average weekly wage and fringe benefits.

II.

FACTS AND PROCEDURAL HISTORY

On June 28, 2005, Gloria Clay, who had been employed with Lourdes

for a total of twenty-two years, sustained a back injury while lifting and pulling heavy

solution bags from twenty carts. She began to have spasms in her upper back on the

first day, and by the end of the second day, June 29, the pain went down her back and

into her left leg. The injury caused Ms. Clay pressure in her back, a ten (10) on the

pain scale, with burning, pulling sensations in her left buttock worsened by sitting,

standing, and walking.

Ms. Clay was treated with medication, physical therapy, and a lumbar

epidural steroid injection. When this worsened her pain, she was referred to a

neurosurgeon, Dr. Bertuccini, who diagnosed symptomatic spinal stenosis at L4-5.

He opined that injury can cause this degenerative condition to become symptomatic

and recommended lumbar decompression surgery at the initial visit in December of

2005. Lourdes did not authorize payment for the prescriptions and surgery

recommended by Dr. Bertuccini until May of 2007.

Lourdes obtained an order compelling vocational rehabilitation in

February of 2008. A vocational rehabilitation counselor provided information

regarding jobs that were ostensibly available to Ms. Clay. She applied for all of the

jobs suggested, including those at a medical facility, but was unable to obtain

employment. Ms. Clay received at least two rejection letters based upon her

unmatched skills and qualifications. Lourdes did not offer Ms. Clay a position

similar to either of the hospital positions recommended by the vocational counselor.

The OWC found that a recommended job at Stuller Settings was

available to Ms. Clay in August of 2008, even though Ms. Clay had received a

2

rejection letter from Stuller. The OWC further found that actual job placement was

not a requirement for proof of availability of employment. Lourdes terminated Ms.

Clay’s benefits in December of 2008 pursuant to the OWC ruling at trial during that

same month.

The OWC issued a judgment finding that Ms. Clay was entitled to

weekly wage benefits of $252.03, based upon an AWW of $378.05, from December

28, 2005 through August 25, 2008, subject to a credit for wage benefits already paid.

The judgment awarded Ms. Clay $8,000.00 in penalties for four failures by Lourdes

to timely pay medical related benefits, as well as attorney fees in the amount of

$10,000.00.

Ms. Clay appealed the judgment on the issues of termination of benefits

and the calculations of average weekly wages and fringe benefits. Lourdes answered

the appeal and listed errors for review, but failed to file its brief. Issues not briefed

are deemed abandoned. See Uniform Rules—Courts of Appeal, Rule 2-12.4.

We find that the OWC applied an overly restrictive interpretation of

Banks v. Industrial Roofing & Sheet Metal Works, Inc., 96-2840 (La. 7/1/97), 696

So.2d 551, resulting in a termination of benefits in this case. Therefore, we reverse

the OWC judgment on the issue of termination of benefits, reinstating Ms. Clay’s

benefits from the date of termination, August 25, 2008, forward. We further reverse

the OWC on its calculation of Ms. Clay’s AWW and fringe benefits due to incorrect

methodology and misinterpretation of the applicable law. We increase the award of

attorney fees by $5,000.00 for work done by Ms. Clay’s attorney on appeal.

3

III.

LAW AND DISCUSSION

Standard of Review

When an appellate court finds that a reversible error of law was made in

the lower court, it must conduct a de novo review of the entire record and render a

judgment on the merits. Rosell v. ESCO, 549 So.2d 840 (La.1989).

Termination of Benefits

Ms. Clay contends that the OWC erred in terminating her benefits. We

agree. The workers’ compensation judge stated at trial that the vocational

rehabilitation counselor, Ms. Montero, “attempted jobs that were suitable” and that

under Banks, 696 So.2d 551, actual “job placement is not required.” Counsel for Ms.

Clay argues that the positions were not suitable and that, since Ms. Clay applied for

all positions submitted and was turned down in every case, those jobs were not

available to her under La.R.S. 23:1221(3)(c)(i).

The record reveals that Ms. Clay was a fifty-six-year-old widow with

three grown daughters when she met with the vocational rehabilitation counselor for

the first time on March 31, 2008. She had graduated from high school in 1971 but

had had no additional schooling. Ms. Clay had worked for Lourdes as a supply,

purchasing, and distribution clerk from 1975 to 1986 and again from 1995 until the

time of her injury in June 2005. In the nine-year interim between her two periods of

employment with Lourdes, Ms. Clay had taken care of her grandmother. Her only

other employment was a two-month temporary position making pies for a bakery. At

Lourdes, she stocked shelves and pulled and delivered medical supplies, occasionally

entering patient charges onto a form in a computer. Ms. Clay did not own a computer

and denied computer literacy. Her rate of pay with Lourdes was $9.95 per hour.

4

Ms. Clay argues that she met her burden of proving that she could not

earn ninety percent (90%) of her pre-injury wages because she could no longer stock

medical supplies and because none of the clerical jobs submitted were available to her

wherein she had applied but was turned down for each one. She correctly argues that

under La.R.S. 23:1221(3)(c)(i), the burden then shifted to Lourdes to prove that the

jobs were available. More specifically, La.R.S. 23:1221(3)(c)(i) (emphasis added)

provides in pertinent part that supplemental earnings benefits shall be paid:

[I]f the employee is not engaged in any employment or
self-employment, as described in Subparagraph (b) of this
Paragraph, or is earning wages less than the employee is
able to earn, the amount determined to be the wages the
employee is able to earn in any month shall in no case be
less than the sum the employee would have earned in any
employment or self-employment, as described in
Subparagraph (b) of this Paragraph, which he was
physically able to perform, and (1) which he was offered or
tendered by the employer or any other employer, or (2)
which is proven available to the employee in the
employee’s or employer’s community or reasonable
geographic region.

Accordingly, as Ms. Clay argues, the clear language of the statute

requires that the jobs be “proven available to the employee.”

In Banks, upon which the OWC relied for the proposition that actual job

placement is not necessary, the primary issue was the employer’s proof of availability,

and the holding in that case squares off directly in favor of Ms. Clay, particularly in

view of the court’s explanation of suitability. In Banks, the Louisiana Supreme Court

reversed the Second Circuit Court of Appeal and reinstated the OWC’s finding that

the employer had failed to demonstrate that jobs were available to the claimant.

Banks had been a roofer’s helper when a bundle of shingles fell on his right hand,

dislocating and fracturing his right thumb, requiring an open reduction and internal

fixation, and a repair of ligament structures the day after the accident.

5

Similar to the facts in this case, the vocational rehabilitation counselor

in Banks completed an initial evaluation and performed a transferrable skills analysis.

Banks was a forty-four (44) year-old high school graduate who had been an orderly,

a cook, and a baker’s helper prior to his employment with Industrial Roofing as a

roofer’s helper. It was undisputed that Banks was partially disabled and unable to

return to his pre-injury employment as a roofer’s helper. Where Banks had proved

partial disability, the question before the court was whether the employer had carried

its burden of proving that there were jobs available to Banks within his physical

capabilities that would pay him ninety percent (90%) or more of his pre-injury wage.

In discussing job availability, the court resolved conflicts in the courts of appeal by

concluding that an employer could discharge its burden of proving job availability by

establishing, at a minimum:

(1) the existence of a suitable job within claimant’s
physical capabilities and within claimant’s or the
employer’s community or reasonable geographic region;

(2) the amount of wages that an employee with
claimant’s experience and training can be expected to earn
in that job; and

[(]3) an actual position available for that particular
job at the time that the claimant received notification of the
job’s existence.

Banks, 696 So.2d at 557 (emphasis added).

In Banks, the claimant’s post-injury limitations were no gripping or

pinching and no lifting over fifteen (15) pounds. The rehabilitation counselor

identified five jobs for Banks: (1) tractor-trailer driver; (2) unarmed security guard;

(3) pest control trainee; (4) cab driver; and, (5) dispatcher. The OWC in Banks

determined that the cab driver position was outside the limitations assigned to Banks

as it required him to lift fifty pounds. As to the remaining jobs, the OWC found that

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there was insufficient evidence regarding each job’s qualifications and physical

requirements, wages, and actual openings on the date the jobs were made known to

Banks, to determine whether the jobs were within Banks’ capabilities. The Louisiana

Supreme Court upheld the judgment of the OWC.

In the present case, Dr. Bertuccini released Ms. Clay to light duty work

in October 2007, following her surgery five months earlier in May. He deferred to

her pain management physician, Dr. Jindia, for approval of jobs submitted by the

vocational rehabilitation counselor. Dr. Jindia was still treating Ms. Clay in August

of 2008, with medication and injections, for chronic low back and left leg pain,

weakness in the lower extremity, and post lumbar laminectomy pain syndrome with

left lumbar radiculitis. He opined that she could physically do clerical work as long

as she could alternate sitting, standing, and walking, with minimal lifting and bending

of her back.

The vocational counselor, Ms. Montero, reported that Ms. Clay’s

transferrable skills included “Writing – Communicating effectively with others in

writing as indicated by the needs of the audience,” though there was no evidence in

the record that Ms. Clay had, or used, writing skills in her employment. Another skill

assigned to Ms. Clay was “Reading comprehension – Understanding written

sentences and paragraphs in work related documents,” though there was no evidence

that Ms. Clay worked with correspondence in her employment. Ms. Montero further

reported that alternate job types for Ms. Clay included general office clerk, library

clerk, insurance claims clerk, and medical records clerk. Ms. Montero located mostly

clerical positions with duties outside of Ms. Clay’s experience and training. Ms.

Montero admitted at the hearing that Ms. Clay had applied for all of the positions

submitted.

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Ms. Montero located four positions for Ms. Clay that were approved by

Dr. Jindia. These included two positions at Medical Center of Southwest Louisiana:

(1) Administrative Assistant - Human Resources Department (to assist department

with credentialing of medical personnel); and (2) Service Coordinator (to provide

clerical support for engineering programs, answer phone, and maintain files). Ms.

Clay applied for but was unable to obtain either of these positions. Two other

approved positions were (3) front desk receptionist with Norman Dykes, M.D. The

duties at Dr. Dykes’ office included maintaining an appointment book, and preparing

bills and insurance forms. Ms. Clay received a letter of rejection from Dr. Dykes’

office stating that they had “chosen to pursue other candidates whose skills,

background, and education more closely match our needs.” The fourth approved

position was a telephone consultant position with Stuller Settings, processing jewelry

merchandise orders by phone. It provided thirty to forty hours of work per week.

Ms. Clay applied for this position and was rejected by a letter stating that, “we have

identified a candidate who more closely matches our requirements.”

Therefore, in this case, we have the issue of suitability of the positions

suggested to Ms. Clay, who applied for all of them and was rejected. In fact, Ms.

Clay testified that she had applied for positions at Bait House, Holiday Inn South,

Maison de Lafayette, Bravo Physical Therapy, and she had applied twice at Stuller

Settings, eleven positions in all, and was turned down for each and every one.

Suitability is a function of availability. It appears in the first of the three

criteria set forth above by the Supreme Court in Banks. More specifically, after

stating the three minimum requirements for establishing availability, the first of

which is a suitable job within the claimant’s physical capabilities, the court

articulated as follows:

8

By “suitable job,” we mean a job that claimant is not
only physically capable of performing, but one that also
falls within the limits of claimant’s age, experience, and
education, unless, of course, the employer or potential
employer is willing to provide any additional necessary
training or education. (FN3)

(FN3.) We are cognizant that LSA-RS
23:1221(3)(a) provides that an employee’s
post-injury earning capacity is to be
determined by what “the employee is able to
earn in any . . . employment or
self-employment, whether or not the same or
a similar occupation as that in which the
employee was customarily engaged when
injured and whether or not an occupation for
which the employee at the time of the injury
was particularly fitted by reason of education,
training, and experience . . . .” Our
consideration of an employee’s “age,
experience, and education” is not to ensure
that an employee is “particularly suited” for a
given post-injury job, but, rather, to ensure
that the employee is capable of performing
the job. For example, suppose that an
employee had been engaged in heavy manual
labor prior to his injury, but is now limited to
light duty labor as a result of a work-related
injury. Suppose also that the employee is
illiterate. Under these circumstances, the mere
fact that the employee would be physically
able to perform secretarial duties does not
mean that that job would be suitable for that
employee.

We interpret the above-quoted language in
LSA-RS 23:1221(3)(a) to mean only that an
employee cannot discount a job, for the
purpose of calculating post-injury earning
capacity, that falls within the limits of his
physical capabilities, age, experience, and
education simply because he is not
“particularly suited” for the job. For example,
suppose that the hypothetical employee had a
college education. He could not protest the
suitability of a job that required only a high
school education by asserting that the
proposed job was beneath his capabilities.

Banks, 696 So.2d at 557, n.3 560 (emphasis added).

9

In this case, Ms. Clay’s experience was essentially as a physical laborer

stocking and distributing supplies and equipment, with no office experience and

almost non-existent computer skills. Her only job experience outside Lourdes was

baking pies. Based upon the foregoing, we find that the positions submitted to and

applied for by Ms. Clay were not suitable for her and were, therefore, unavailable to

her under La.R.S. 23:1221 and under Banks.

Calculation of Actual Average Weekly Wage

It is undisputed that Ms. Clay was a forty-hour-per-week, full time,

hourly employee, paid bi-weekly, in twenty-six checks per year. Her pay rate with

Lourdes was $9.25 per hour. The OWC calculated Ms. Clay’s AWW at $378.05

based upon two check stubs indicating wages paid to her by Lourdes for the four

weeks preceding her injury on June 28, 2005. The gross earnings on the check stub

for the two-week period ending June 25, 2005, was $772.19, and the gross earnings

on the check stub for the two-week period ending June 11, 2005, was $740.00.

According to the OWC calculation, $772.19 plus $740.00 equals $1,512.19, which,

divided by two, results in an AWW of $378.05. The OWC declined to consider Ms.

Clay’s fringe benefits, or a bonus that she earned during the applicable period, in

calculating the AWW. While the OWC was correct in rejecting an AWW based upon

twenty six weeks of fringe benefits, as argued by counsel for Ms. Clay, the OWC’s

calculations and methodology are incorrect, as are those of counsel for Ms. Clay, who

arrived at an AWW of $430.49.

We find that Ms. Clay’s AWW was $416.71, which is the sum of her

actual or baseline wage of $370.00 ($9.25 x 40) plus averaged weekly fringe benefits

of $27.75 for paid time off (PTO) and $11.56 for extended illness time (EIT), plus a

bonus averaged at $7.40 per week. The method for calculating the actual wages of

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$370.00 is located at La.R.S. 23:1021(12)(a)(i), while the formula for calculating the

bonus is located at subsection (12)(d), and the provision applicable to fringe benefits

is subsection (12)(f).

With regard to Ms. Clay’s baseline or actual wage of $370.00, La.R.S.

23:1021(12)(a)(i) provides as follows (emphasis added):

(12) “Wages” means average weekly wage at the
time of the accident. The average weekly wage shall be
determined as:

(a) Hourly wages.

(i) If the employee is paid on an hourly basis and the
employee is employed for forty hours or more, his hourly
wage rate multiplied by the average actual hours worked
in the four full weeks preceding the date of the accident or
forty hours, whichever is greater. . . .

Accordingly, if a full-time, forty-hour employee actually works less than

forty hours per week in the four full weeks prior to her accident, she is entitled to the

“greater” presumption of forty hours per week. While it is true that Ms. Clay used

paid time off, or vacation time, during the four full weeks preceding the injury, such

that she did not actually work forty hours per week during that period, because she

is a full-time employee, she is entitled to the presumption of having worked forty

hours under La.R.S. 23:1021(12)(a)(i). Therefore, Ms. Clay’s AWW is $370.00

($9.25 x 40).1

1
We have considered the holdings in Doucet v. Crowley Manufacturing, 96-1638 (La.App.
3 Cir. 4/30/97), 693 So.2d 328, vacated on other grounds, 97-1438 (La. 9/19/97), 701 So.2d 143,
and Transportation Insurance Co. v. Pool, 30,250 (La.App. 2 Cir. 5/13/98), 714 So.2d 153, writs
denied, 98-1566, 98-1616 (La. 9/25/98), 725 So.2d 486, 488, where the courts did not use vacation
weeks to calculate the AWW, using the logic that “four full weeks” meant four weeks with no
absences. However, reaching back to capture non-vacation weeks is an unnecessary step where the
employee is a forty-hour, full time employee who gets the presumption under 12(a)(i) of a forty-hour
work week in calculating his or her AWW. Moreover, we believe that the term “four full weeks”
means using a normal, full-week pay period, such as Monday through Friday, rather than starting the
calculation, say, in mid-week on the day before the accident; and it does not mean that you have to
use non-vacation weeks if the employee is a full time, forty-hour employee.

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Fringe Benefits

With regard to the use of fringe benefits in calculating a claimant’s

AWW, we have held as follows:

[T]he inclusion of fringe benefits into the calculation of
AWW is a very well and long established rule, dictated by
an explicit mandate of La.R.S. 23:1021(12)(f) and decades
of our jurisprudence. See e.g. Sterling v. Asplundh Tree
Expert Co., 03-266 (La.App. 3 Cir. 10/1/03), 856 So.2d
125, writ denied, 03-3017 (La. 1/30/04), 865 So.2d 79;
Batiste v. Capitol Home Health, 96-799 (La.App. 3 Cir.
5/7/97), 699 So.2d 395; Morgan v. Equitable Gen. Ins. Co.,
383 So.2d 1067 (La.App. 3 Cir. 1980); Ardoin v. S. Farm
Bureau Cas. Ins. Co., 134 So.2d 323 (La.App. 3 Cir.
1961); Richmond v. Weiss & Goldring, Inc., 124 So.2d 601
(La.App. 3 Cir. 1960).

Cotton v. First Fleet, 08-1363, p. 7 (La.App. 3 Cir. 4/1/09), 7 So.3d 155, 159, writ

denied, 09-978 (La. 6/19/09), 10 So.3d 741.

In fact, so settled is this area of the law that we have affirmed penalties

against an employer who deliberately chose to remain ignorant of the law with respect

to the valuation of fringe benefits in the calculation of an injured worker’s wage rate.

See Johnson v. Louisiana Container Co., 02-382 (La.App. 3 Cir. 10/2/02), 834 So.2d

1052, 1067, writ denied, 02-3099 (La. 5/9/03), 843 So.2d 394.

The Louisiana Supreme Court has stated:

In determining the amount of pre-injury wages an
employee earned, “[a]ny money paid the employee which
can be regarded as remuneration or reward for his services
should be included in fixing his compensation, irrespective
of whether or not the payment was in the form of wages.”
Malone and Johnson, 14 Louisiana Civil Law Treatise,
Workers’ Compensation § 324 at 93 (1980).

Daigle v. Sherwin-Williams Co., 545 So.2d 1005, 1007-08 (La.1989).

In Sterling, 856 So.2d 125, we affirmed the OWC’s inclusion of fringe

benefits, ten days of vacation and five days of holiday pay, when calculating the

claimant’s AWW. We cited the essentially identical predecessor of La.R.S.

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23:1021(12)(f), which was La.R.S. 23:1021(10)(f), effective on August 15, 1999, for

the proposition that fringe benefits are taxable and therefore includable in the AWW.

The current version, La.R.S. 23:1021(12)(f) provides as follows (emphasis added):

(f) Income tax. In the determination of “wages” and
the average weekly wage at the time of the accident, no
amount shall be included for any benefit or form of
compensation which is not taxable to an employee for
federal income tax purposes; however, any amount
withheld by the employer to fund any nontaxable or
tax-deferred benefit provided by the employer and which
was elected by the employee in lieu of taxable earnings
shall be included in the calculation of the employee’s wage
and average weekly wage including but not limited to any
amount withheld by the employer to fund any health
insurance benefit provided by the employer and which was
elected by the employee in lieu of taxable earnings shall be
included in the calculation of the employee’s wage and
average weekly wage.

In Sterling, we stated that the issue regarding the inclusion of paid

holiday and vacation time was whether those forms of compensation were taxable or

not. We went on to hold that:

Any fringe benefit that an employer provides is taxable and
must be included in the recipient’s pay unless that fringe
benefit is specifically excluded by the law. EMPLOYER’S
TAX GUIDE TO FRINGE BENEFITS PUB. 15-B (Dept.
of the Treasury, Internal Rev. Serv., Jan. 2003).

Sterling, 856 So.2d at 130.

We then listed excluded fringe benefits such as meals, stock options,

group term life insurance, and other specifically excluded benefits. Since the fringe

benefits of vacation and holiday pay in Sterling were not excluded by law, they were

included in the AWW calculation. Likewise, in Burns v. St. Francis Cabrini

Hospital, 02-518 (La.App. 3 Cir. 10/30/02), 830 So.2d 572, we held that PTO, sick

leave, holiday pay, and vacation pay were rewards to hourly employees for services

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to the hospital and were properly included in the calculation of the claimant’s AWW

pursuant to Daigle.

In G.N.B., Inc. v. Jones, 29,779 (La.App. 2 Cir. 8/20/97), 699 So.2d 466,

the baseline or actual AWW was increased by $35.67 for 160 hours of vacation pay

valued at $1,854.40 ($1,854.40 ÷ 52 = $35.67) and was increased by $21.40 for

ninety-six (96) hours of holiday pay valued at $1,112.64 ($1,112.64 ÷ 52 = $21.40).

Additionally, the weekly value of insurance and other benefits, $87.28, was added

to the weekly cash wage of $463.60 for a total AWW of $607.95.2

In Pool, 714 So.2d 153, an economics expert testified that the claimant’s

medical and retirement benefits, plus compensated time off, equaled $106.67 per

week. After adjusting the actual wage to $455.67, to include overtime as shown

above, the second circuit affirmed the OWC’s addition of $41.38 for medical

insurance, $18.60 for retirement benefit, and $46.69 for compensated time off, for a

total AWW of $562.34.

In Moses v. Grambling State University, 33,185 (La.App. 2 Cir.

5/15/00), 762 So.2d 191, writ denied, 00-1769 (La. 9/22/00), 768 So.2d 1285, the

court held that the claimant’s AWW of $352.08 should be increased by $44.76 for

weekly insurance benefits, $43.66 for weekly retirement benefits, and by $59.13, the

weekly value of fourteen hours of annual leave and fourteen hours of sick leave per

month, for a total AWW of $499.62.

In the present case, Monica Hornsby, employed by Lourdes for twenty-

six years, and responsible for timekeeping and payroll, testified that Ms. Clay, an

2
We note that in Jones and other cases involving injuries occurring before August 15, 1999,
when subsection (f) was added to La.R.S. 23:1021(10), now appearing as 23:1021(12)(f), the courts
included as fringe benefits the insurance premiums and retirement benefits that were paid by the
employer. After the 1999 amendment adding subsection (f), only the employee’s portion of the
insurance premium is includable in the AWW as a fringe benefit, because the non-wage or fringe
benefit, to be includable, must be taxable to the employee. La.R.S. 23:1021(12)(f).

14

hourly employee, does not get credit for time earned if she is out sick or otherwise

absent. However, she earns six (6) hours of paid time off (PTO) on each of her

twenty-six pay-checks, that is six hours for every eighty (80) hours worked. Ms.

Hornsby also testified that each employee earns two and a half hours (2.5) of

extended illness time (EIT) per pay period. This is kept in a separate “bank” and is

tracked on the check stub as well.

Based upon the testimony of Ms. Hornsby, we find that Ms. Clay

received an average weekly fringe benefit of PTO in the amount of $27.75 (6 x 26 =

156 hrs/per/yr ÷ 52 wks = 3 hrs/per/wk x $9.25 = $27.75). We also find that Ms.

Clay received an average weekly fringe benefit of EIT in the amount of $11.56 (2.5

x 26 = 65 hrs/per/yr ÷ 52 wks = 1.25 hrs/per/wk x $9.25 = $11.56).

With regard to holiday pay under Sterling, Burns, and Jones, Kevin

Domingue, Lourdes’ director of human resources, testified that the employees receive

holiday pay, and if they work on a holiday, they earn holiday overtime at the rate of

one and one half times their regular hourly wage. In Ms. Clay’s case, that is $13.88

per hour ($9.25 x 1.5 = $13.88). The personnel manual proffered by Lourdes indicates

the provision of seven (7) paid holidays. However, if an employee is scheduled to be

off on a holiday, the time is charged from the employee’s PTO bank. Therefore, in

this instance, regular holiday pay is already accounted for in the PTO calculation

above. In the event that an employee is scheduled by Lourdes to work on a holiday,

that employee is paid an additional amount for holiday overtime. Overtime is used for

calculating the AWW, but only during the four full weeks preceding the injury.

Therefore, while Ms. Clay earned $333.24 in holiday overtime according to her year-

15

to-date information, she did not earn it during the applicable pay periods, and we will

not assign an additional amount for holiday pay in this case.3

In the present case, the OWC and Lourdes cited Ivory v. Southwest

Developmental Center, 07-1201 (La.App. 3 Cir. 3/5/08), 980 So.2d 108, for the

proposition that fringe benefits are not added to the actual earnings. Ivory is

inapplicable. There, the employee was injured six months after being employed with

the defendant, and the panel found that there was no evidence of fringe benefits having

been received. Lourdes, with apparent approval of the OWC, interpreted this to mean

that a fringe benefit, such as PTO or holiday pay, must be “used” and “received” and

appear on the check stub for the four-week period prior to injury. This is not true. Ms.

Clay worked for Lourdes for a total of twenty-two years. Her vacation pay and other

fringe benefits would have an added value even if she had not used them in the weeks

prior to her injury.

Moreover, as shown above, weeks used for vacation in the four weeks

immediately preceding the injury are specifically not used in the calculation of the

AWW because they are not full weeks. Likewise, there has been a tendency to

misinterpret subsection (f) as requiring that a specific benefit must have been received

on a check and therefore “taxed” before being considered in a claimant’s AWW. We

disagree with this interpretation, as discussed below, because subsection (f) requires

benefits to be “taxable,” not “taxed.”

3
Ms. Clay apparently worked three holidays during the year as of the pay stub dated 6/03/05
($333.24 ÷ $13.88/hr = 24 hrs = 3 days). However, as indicated, Ms. Clay’s holiday overtime pay
would be calculated in the AWW as overtime if it had occurred during the applicable pay periods,
not as a fringe benefit, because the basic holiday pay fringe benefit is characterized by Lourdes as
part of the PTO benefit. It seems appropriate to here insert the observation from the above
jurisprudence that fringe benefits are often averaged over a fifty-two week period and added to the
actual or baseline AWW, which, including overtime, is calculated under La.R.S. 23:1021 and covers
the four full weeks preceding the injury. Some parties arrive at inaccurate figures, and inaccurate
reasoning, when they conclude that fringe benefits are “included” in the claimant’s AWW and then
fail to add the non-wage benefit to the actual wage earned.

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Ivory held that only paid leave used during the four weeks preceding the

accident was includable in calculating the AWW, that paid holidays were not

includable for an hourly employee, that benefits were only taxable when they were

used, and that fringe benefits were already included in the hourly rate. As indicated

in the above jurisprudence and reasoning, these holdings are not reconcilable with the

law on fringe benefits and are inapposite as precedent in calculating an hourly

employee’s total AWW.

In part, Ivory falls out of accord with established jurisprudence on holiday

pay and with La.R.S. 23:1021(12)(f), due to its reliance upon Anderson v. Eckerd

Corp., 04-1053 (La.App 1 Cir. 5/6/05), 915 So.2d 901, writ denied, 05-1520 (La.

1/9/06), 918 So.2d 1044, which declined to add amounts for paid holiday and vacation

benefits to a salaried employee’s AWW. Anderson is too brief to shed any light on

the subject, but it refers to the claimant’s salary and cites Moses, 762 So.2d 191,

which also addressed a salaried employee. The court in Moses, as indicated above,

increased the AWW for annual and sick leave and other benefits, but not for vacation

and holiday benefits.

In Burns, 830 So.2d at 575, we distinguished Moses as follows:

In Moses, the employee was paid an annual salary,
not an hourly wage like Mr. Burns and the employee in
G.N.B., Inc. In the memorandum to “All Employees”
regarding “Paid Time Off” and “Extended Sick Leave,”
Cabrini describes “Paid Leave” as "hours for use as time
away from work for the purpose of vacation/holiday,
personal business, family illness and/or short-term personal
illness.” There is no indication that without this policy
hourly employees, like Mr. Burns, would be paid for
holidays, unless they worked those days. According to this
policy, holiday pay is the same as vacation and sick leave:
employees are rewarded with these benefits for their service
to the hospital. Pursuant to Daigle, 545 So.2d 1005, Mr.
Burns’ holiday pay was properly included in the AWW
calculation.

17

Ivory’s reliance on Anderson, and therefore Moses, is therefore misplaced

where Ivory was also an hourly employee. Further, Ivory is self-conflicting because

it cites our decision in Sterling, which held that vacation and holiday pay are taxable

and includable in the AWW. According to Ivory, the claimant did not receive “any

fringe benefits which were specifically excluded from income taxation.” Ivory, 980

So.2d at 115. Ivory then fails to add them to the AWW calculation. Ivory then found

that the claimant’s sick leave, annual leave, and compensatory time were only taxable

when used, which is not what La.R.S. 23:1021(12)(f) provides.

Ms. Clay earned a bonus of $384.80, which covered a full year ending

with the pay period June 25, 2005, and which was reflected in a separate pay-check

dated July 1, 2005. Lourdes argued at trial that this bonus should not be considered

in calculating the AWW because it was not taxed to Ms. Clay until the check was cut

on July 1, 2005, which was after the injury on June 28, 2005. We disagree, as stated

above. The bonus was for the pay period ending June 25, just days before the injury.

Therefore, it was earned prior to the injury.

Mr. Domingue testified that Ms. Clay, along with thirty-three percent of

Lourdes’ employees, had been at the top of her pay scale and had gone without raises

for at least two years. Lourdes, therefore, paid those employees a bonus for the fiscal

year ending in June 2005. The bonus was for two percent (2%) of Ms. Clay’s annual

earnings ($9.25 x 2080 x .02 = $384.80). Accordingly, we find that Ms. Clay’s bonus

should be calculated as an element of her total AWW.

The Louisiana Supreme Court in Daigle, 545 So.2d 1005, held that two

incentive bonuses of the salaried employee would fit more neatly into the AWW if

calculated as “other wages” under La.R.S. 23:1021(10)(d). The current provision is

located at La.R.S. 23:1021(12)(d) and provides in pertinent part as follows:

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(d) Other wages. If the employee is employed on a
unit, piecework, commission, or other basis, his gross
earnings from the employer for the twenty-six week period
immediately preceding the accident divided by the number
of days the employee actually worked for the employer
during said twenty-six week period and multiplied by the
average number of days worked per week[.]

If we calculate Ms. Clay’s bonus using subsection (d), we find that she

actually worked 114 days, an average of 4.4 days per week, in the twenty-six week

period preceding the injury. Using the above formula, we arrive at a weekly benefit

of $7.44 ($384.80 ÷ 2 = $192.40 ÷ 114 = $1.69 x 4.4 = $7.44).

However, the court in Daigle provided in a footnote that it did not use this

formula in its previous decision involving an hourly employee in Allen v. Belden

Corporation, 393 So.2d 1233 (La.1981).4 In Burns, involving an hourly employee,

we included in the AWW calculation a three percent lump sum bonus of $713.24.

There, we simply divided the bonus amount by fifty-two and arrived at a weekly bonus

benefit of $13.72. Accordingly, we will use the calculation method in Burns, which

in this case results in a weekly bonus benefit of $7.40 ($384.80 ÷ 52 = $7.40). This

brings Ms. Clay’s total AWW to $416.71.5

4
We are also aware that Daigle used a two-part incentive bonus paid to the claimant before
his accident in May and indicated in a footnote that there was another incentive bonus paid in
August, after the accident, for the first half of the year (presumably for January through June). This
third bonus was not included in the calculation of AWW, not even on a prorated basis.
Notwithstanding, we have included Ms. Clay’s bonus which was earned entirely by June 25, 2005
and paid to her only days after the injury on June 28, 2005, where Ms. Clay’s bonus was in lieu of
an annual raise, while the Daigle bonuses were based upon sales volume and profit goals.
5
We note that two of Ms. Clay’s three check stubs in evidence show a deduction from her
wages of $37.20 which is described simply as “ health.” We are assuming that this entry constitutes
a health insurance premium deducted by the employer for Ms. Clay’s portion of a health insurance
benefit. Even though this deduction is not shown on Ms. Clay’s check stub as a taxable amount,
under La.R.S. 23:1021(12)(f), this appears to be a specifically includable benefit which would
increase her AWW by another $18.60. However, there was no testimony, argument, or additional
evidence regarding this premium that would allow us to include it in Ms. Clay’s AWW. Moreover,
where the premium was not withheld from one of the three check stubs in evidence, with no
explanation as to why, we will not include the premium in our calculation of AWW based upon
insufficient information.

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IV.

CONCLUSION

Based upon the foregoing, we reverse the OWC judgment terminating

Ms. Clay’s benefits where she was no longer physically able to stock medical supplies

and where the clerical and office positions submitted by the vocational rehabilitation

counselor, and applied for by Ms. Clay without avail, were unsuitable and unavailable

to her under La.R.S. 23:1221 and under Banks.

We further reverse the OWC’s calculation of Ms. Clay’s total AWW,

finding that her correct AWW is $416.71, which includes an actual wage of $370.00

plus a weekly PTO benefit of $27.75, a weekly EIT benefit of $11.56, and a weekly

bonus benefit of $7.40. We award an additional $5,000.00 in attorney fees for work

done by Ms. Clay’s attorney on appeal.

REVERSED AND RENDERED.

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