                            No.    93-500

          IN THE SUPREME COURT OF THE STATE OF MONTANA
                                  1994


EARL DESHNER,
         Claimant and Appellant,


TOWN AND COUNTRY FOODS, INC., and
STATE COMPENSATION MUTUAL INSURANCE
FUND,
         Employer, Defendant and
         Respondent.




APPEAL FROM:    Workers' Compensation Court
                The Honorable Timothy J. Reardon, Judge presiding.


COUNSEL OF RECORD:
          For Appellant:
                Tom L. Lewis, Great Falls, Montana
          For Respondent:
                Thomas E. Martello, State Compensation Insurance
                Fund, Helena, Montana


                                  Submitted on Briefs:   June 30, 1994
                                              Decided:   August 30, 1994
Filed:



                                               .
                                               ~
Justice James C. Nelson delivered the Opinion of the Court.

     This is an appeal from a Workers' Compensation Court Findings
of Fact, Conclusions of Law and Judgment awarding the claimant Earl
Deshner    $167.17   per week   as his total temporary    disability
compensation rate, based upon an average weekly wage of $250.63.
We reverse.
     The sole issue on appeal is whether the Workersr Compensation
Court correctly calculated Deshnerts total temporary disability
compensation rate.
                                BACKGROUND
        Earl Deshner (Deshner) commenced employment with Town and
Country Foods as a stocker in September, 1991 on a full-time basis
with some weekly overtime hours. His starting salary was $5.00 per
hour but in October of 1991, his salary was raised to $6.00 per
hour.     He received a $250.00 bonus on December 31, 1991 and on
March 1, 1992, his salary was again increased, to $7.25 per hour.
On March 17, 1992, he "suffered an industrial injury arising out of
and in    the course of his employment with Town and Country Foods,
I ~ C . ~Town and Country accepted liability and paid temporary total
         '
disability payments of $153.82 per week.
        Deshner filed a petition for hearing on March 8, 1993,
contending that his weekly compensation benefits should be $199.89
per week based upon his actual wage at the time of the injury,
which was $7.25 per hour.        On September 2, 1993, the Workers'
Compensation Court filed its Findings of Fact, Conclusions of Law
and Judgment, stating that Deshnerls total disability compensation
                                    2
rate should be $167.17 per week.     The Workers' Compensation Court
based    its calculations upon the claimant's four pay periods
previous to his injury pursuant to 5 39-71-701(3), MCA.     Deshner's
hourly wage during the four preceding pay periods was $6.00 per
hour.     From this conclusion of the Workers' Compensation Court,
Deshner appeals.
                          STANDARD OF REVIEW
        The standard of review for conclusions of law is whether the
lower tribunal correctly interpreted the law.          Steer Inc. v.
Department of Revenue (1990), 245 Mont. 470, 474-475, 803 P.2d 601,


                                OPINION

        In order to determine the proper total temporary disability
compensation rate (weekly compensation benefit) for Deshner, we
review the applicable statutes. The following excerpts of statutes
were in effect at the time of Deshner's injury and control the
calculation of wages and weekly compensation benefits:
        39-71-701. Compensation for temporary total disability
        exceptions. (I) Subject to the limitation in 39-71-736
                                                               -
        and subsection (4) of this section, 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 the time of the injury ....
        39-71-123. Wages defined. (1) I1Wagesq'  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.
      Deshner   argues   that    the    Workers'   Compensation   Court
incorrectly calculated his weekly compensation benefits because it
did so on the basis of his previous hourly rate of $6.00 per hour.
Deshner contends that at the time of the injury, his salary had
been increased to $7.25 per hour, and that is the correct amount to
be used to calculate his benefit. He also claims that the Workers'
Compensation Court's conclusion conflicts with the plain wording of
§   39-71-701(3), MCA.   Finally, he asserts that either subsection
(a) or subsection (b) of    §   39-71-123(3), MCA, should be applied,
both authorizing a different calculation of the weekly compensation
benefit.
      Town and Country counters that S 39-71-123(3), MCA, mandates
that the four pay periods preceding Deshner's injury should be
utilized to calculate his wages; Deshner's hourly rate for those
pay periods was $6.00 per hour.         Town and Country states that
claimant cannot rely on the language of 5 39-71-701(3), MCA, which
states that "temporary total disability shall be 66 2/3% of the
wages received at the time of injury" because the four preceding
pay periods must be used in order to determine                Finally,
Town and Country also states that subsections (a) and (b) of g 39-
71-123(3), MCA, are inapplicable here.
      The difficulty in the present case stems from the fact that
                                    4
the claimant was earning $6.00 per hour for the four pay periods
prior to his    injury but he was earning $7.25      per hour, a
substantially higher wage, at the actual time of the injury.    In
general, a worker's hourly wage for the four preceding pay periods
will be the same as his hourly wage at the time of the injury.
Therefore, in most cases, 5    39-71-701, MCA, which establishes
weekly compensation benefits based on "wages received at the time
of the injury" and 5 39-71-123, MCA, which establishes weekly
compensation benefits based on the workergs salary over the four
preceding pay periods, will not conflict. However, in this case,
the conflict occurs because there is such a dramatic difference
between the two salaries and because Deshner is entitled to be paid
benefits which bear a reasonable relationship to his actual wage
loss.
     Section 39-71-701(3), MCA, states that the weekly compensation
benefit for an injury which produces a temporary total disability
shall be 66 2/3% of the claimant's wages received at the time of
the injury.   Deshner's hourly wage at the time of the injury was
$7.25 per hour, not the $6.00 per hour used by the Workers9
Compensation Court. Deshner was earning $6.00 per hour during the
four pay periods prior to his injury. However, he received a raise
and his salary increased to $7.25 per hour on March 1, 1992.    He
was hired and maintained as a fulltime employee working 40 hours
per week plus sporadic overtime. Using the formula provided under
5 39-71-701, MCA, we calculate the following weekly compensation
benefit :
                 $ 7.25     hourly wage at time of injury
            x         40    hours worked per week
      --------------
            $ 290.00        weekly wages
                $290.00     weekly wages
        x        66 2/3 %   percentage to be applied pursuant to
                            5 39-71-701(3), MCA.
      --------------
                $193.34     weekly compensation benefit
      The weekly compensation benefit for Deshner using the hourly
wage he was actually earning at the time of injury would be
$193.34.         However, this compensation rate does not take into
account any overtime pay or bonus pay received by Deshner.                On

remand, the Workers1 Compensation Court may also consider whether
and, if so, to what extent, overtime pay and bonus pay should be
included in determining Deshner's final total temporary disability
compensation rate.
      The determination of $193.34 as the base compensation rate
differs from the Workers' Compensation Court's calculation, which
used a $6.00 hourly wage and totalled $167.17. The application of
5   39-71-123(3), MCA, used by the Workers' Compensation Court,
appears to conflict with 5 39-71-701(3), MCA, in the instant case.
Section 39-71-123(3), MCA, states that to determine the claimant's
weekly compensation benefit, the average actual earnings for the
four pay periods preceding the injury should be utilized. However,
5 39-71-701(3), MCA, states that weekly compensation benefits shall
be 66 2/3% of the claimant's wages "received at the time of the
injury." Deshner argued, and we agree, that subsection (b) of 539-
71-123 (3), MCA, which provides an exception to 5 39-71-123 (3), MCA,
is applicable to the instant case, conforms with 5 3 9 - 7 1 - 7 0 1 ( 3 ) ,
                                     6
MCA, and authorizes the weekly compensation benefit calculated
herein.
     Subsection (b) provides an exception to the standard use of
the four preceding pay periods to determine the weekly compensation
rate.     The subsection states that if the claimant can show good
cause as to why the use of the four pay periods does not accurately
reflect the claimant's employment history, then additional pay
periods can be used.     According to Deshner's employment history
with Town and Country, he was earning $7.25 per hour at the time of
his iniury, albeit earning $6.00 per hour for the preceding months.
A calculation of his weekly compensation rate at an hourly wage of
$6.00 does not adequately reflect his employment history.       The
Workerst Compensation Court should have utilized a pay period which
reflected his actual wage at the time of his injury, which was
$7.25 per hour.    Deshner has demonstrated that there is good cause
to use a pay period which accurately reflects his actual wages at
the time of the injury to determine his weekly compensation
benefit.
        This decision also conforms with the public policy of the
State regarding wage-loss benefits. Section 39-71-105, MCA, states
in pertinent part:
        ....
          (1) [i]t is an objective of the Montana workerst
     compensation system to provide, without regard to fault,
     wage supplement and medical benefits to a worker
     suffering from a work-related injury or disease. Wage-
     loss benefits are not intended to make an injured worker
     whole; they are intended to assist a worker at a
     reasonable cost to the employer. Within that limitation,
     the waqe-loss benefit should bear a reasonable
     relationship to actual waqes lost as a result of a work-
     related iniurv or disease.   (Emphasis added.)
A weekly compensation benefit calculated at $7.25 per hour bears a

much more reasonable relationship to Deshner's actual wases lost as
a result of his injury than does a calculation using $6.00 per
hour. The appropriate total temporary disability compensation rate
(or weekly   compensation benefit)    is   $193.34,   calculated   by
multiplying 66 2/3% by an hourly wage rate of $7.25 at 40 hours per
week.   Because we are unclear as to how, if at all, the Workers'
Compensation Court calculated Deshner's total temporary disability
rate with respect to overtime pay and bonus pay, the Workers'
Compensation Court should consider these two issues on remand in
order to determine Deshner's final compensation benefit rate.
     We hold that the Workers' Compensation Court incorrectly
determined the claimant's total temporary disability compensation
rate because the Workers' Compensation Court should have applied 5
39-71-123(3)(b), MCA.   We reverse and remand for entry of an order
for temporary total disability benefits consistent with this
opinion. REVERSED AND REMANDED.            /-77%
                        August 30, 1994

                 CERTIFICATE OF SERVICE

that the following certified order was sent by United States mail, prepaid, to the




                                    ED SMITH
                                    CLERK OF THE SUPREME COURT


                                             b&
                                    STATE OF MONTANA

                                    BY
                                    Deputy
