                                                                           FILED
                                                                      Nov 16 2017, 5:25 am

                                                                           CLERK
                                                                       Indiana Supreme Court
                                                                          Court of Appeals
                                                                            and Tax Court




ATTORNEYS FOR APPELLANT                                   ATTORNEY FOR APPELLEE
Donald S. Smith                                           Nathan B. Maudlin
Laura S. Reed                                             Klezmer Maudlin, P.C.
Miranda W. Bernadac                                       New Harmony, Indiana
Riley Bennett Egloff LLP
Indianapolis, Indiana



                                           IN THE
    COURT OF APPEALS OF INDIANA

Midwest Equipment &                                       November 16, 2017
Supply Co.,                                               Court of Appeals Case No.
Appellant-Respondent,                                     93A02-1705-EX-1140
                                                          Appeal from the Indiana Worker’s
        v.                                                Compensation Board
                                                          The Honorable Linda Peterson
James Garwood,                                            Hamilton, Chairperson
Appellee-Claimant                                         Application No.
                                                          C-229439



Baker, Judge.




Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017                   Page 1 of 8
[1]   James Garwood was an employee of Midwest Equipment & Supply Co.

      (Midwest) when he was injured on the job. He was awarded worker’s

      compensation benefits pursuant to the Worker’s Compensation Act.1 Midwest

      appeals the award Garwood received, arguing that the Worker’s Compensation

      Board (the Board) erred when it determined that Garwood’s two bonuses

      should be considered earnings for purposes of calculating Garwood’s average

      weekly wage, a calculation that determined the amount of benefits Garwood

      received. Garwood argues that this Court should affirm the Board’s decision

      and increase his award pursuant to the Act. Finding no error with the Board’s

      decision and that Garwood is entitled to an increased award, we affirm the

      Board’s decision and remand with instructions to increase Garwood’s award by

      5%.


                                                     Facts
[2]   Garwood began working at Midwest in 2004 as a shipping and receiving clerk.

      He received a promotion to warehouse supervisor in 2013. On November 1,

      2013, Garwood received a $20,000 profit sharing bonus. Midwest’s profit

      sharing bonus is tied to the company’s profits. On April 4, 2014, Garwood

      received a $1,750 shipping bonus. The shipping bonus is tied to the work an

      individual performs in the warehouse. On July 24, 2014, Garwood suffered an

      injury while unloading cargo at work.




      1
          Ind. Code § 22-3-1-1 et seq.


      Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 2 of 8
[3]   At some point, Garwood filed a claim for worker’s compensation benefits.

      Following his filing, Midwest calculated Garwood’s average weekly wages

      using the regular wages Garwood earned in the fifty-two weeks immediately

      preceding his injury. Midwest did not include Garwood’s two bonuses in this

      calculation.


[4]   On March 14, 2016, Garwood filed an application for adjustment of his claim.

      On November 7, 2016, a hearing was conducted before a hearing member of

      the Board regarding, in part, whether Garwood’s bonuses should have been

      included in Midwest’s calculations of his average weekly wages. On December

      8, 2016, the hearing member determined that Garwood’s shipping bonus of

      $1,750 and profit sharing bonus of $20,000 should have been included in the

      calculation, and the hearing member awarded Garwood additional benefits as a

      result of that determination.


[5]   On January 9, 2017, Midwest appealed the hearing member’s order to the full

      Board. On March 13, 2017, a hearing took place with the full Board. On April

      28, 2017, the full Board affirmed the hearing member’s opinion. Midwest now

      appeals.


                                    Discussion and Decision
[6]   Midwest argues that the Board erred when it included Garwood’s bonuses in its

      calculations of Garwood’s average weekly wages. Our standard of review of a

      decision of the Board is well established:



      Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 3 of 8
              In reviewing a worker’s compensation decision, an appellate
              court is bound by the factual determinations of the Board and
              may not disturb them unless the evidence is undisputed and leads
              inescapably to a contrary conclusion. We examine the record
              only to determine whether there are any substantial evidence and
              reasonable inferences that can be drawn therefrom to support the
              Board’s findings and conclusion. As to the Board’s interpretation
              of the law, an appellate court employs a deferential standard of
              review to the interpretation of a statute by an administrative
              agency charged with its enforcement in light of its expertise in the
              given area. The Board will only be reversed if it incorrectly
              interpreted the Worker’s Compensation Act.


      Christopher R. Brown, D.D.S., Inc. v. Decatur Cty. Mem’l Hosp., 892 N.E.2d 642,

      646 (Ind. 2008) (internal citations omitted).


[7]   Indiana’s Worker’s Compensation Act serves “to aid workers and their

      dependents and shift the economic burden for employment related injuries from

      the employee to the employer and consumers of its product and services.”

      Tunny v. Erie Ins. Co., 790 N.E.2d 1009, 1013 (Ind. Ct. App. 2003). It is

      intended to provide an expeditious remedy that will guarantee the injured party

      some recovery for an industrial accident. Id. “Worker’s compensation is for

      the benefit of the employee, and the Act should be liberally construed . . . so as

      to not negate the Act’s humane purposes.” DePuy, Inc. v. Farmer, 847 N.E.2d

      160, 170 (Ind. 2006) (internal quotation marks and citation omitted). Doubts in

      the application of the Act’s terms are to be resolved in favor of the employee.

      Brown, 892 N.E.2d at 649.




      Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 4 of 8
[8]    The Act defines “average weekly wages” as “the earnings of the injured

       employee in the employment in which the employee was working at the time of

       the injury during the period of fifty-two (52) weeks immediately preceding the

       date of injury, divided by fifty-two (52).” I.C. § 22-3-6-1(d). The Act does not

       define “earnings.” There is nothing in the Act that excludes a bonus already

       awarded to an employee—whether it is awarded based on an individual’s

       productivity or a company’s profit—from being considered as earnings and

       therefore included in the calculation of average weekly wages.


[9]    In this case, during the fifty-two weeks immediately preceding Garwood’s

       injury, he received two bonuses totaling $21,750. Deeming these bonuses to be

       earnings and including them in the calculation of Garwood’s average weekly

       wages increases his worker’s compensation award, thereby shifting any

       economic burden Garwood may have during his physical recovery from

       Garwood to Midwest. This result effectuates the Worker’s Compensation Act’s

       humane purpose and goal of benefitting the employee.


[10]   Midwest contends that Garwood’s bonuses should not be included in the

       calculations of his average weekly wages because his bonuses were not

       governed by a written agreement, were not automatically paid, and were

       awarded through discretionary decisions made by Midwest’s management, and

       the profit sharing bonus was not based on his output or performance. True as

       those statements may be, the statute defining average weekly wages specifies

       only one condition for its calculation—that the calculation include the earnings

       of the injured employee during the period of fifty-two weeks immediately

       Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 5 of 8
       preceding the date of injury. I.C. § 22-3-6-1(d). It is undisputed that Garwood

       received his bonuses during the fifty-two weeks that immediately preceded his

       injury. To require any additional conditions would go beyond the express

       language of the statute. As our Supreme Court has stated, because the

       Worker’s Compensation Act “is uniquely legislative . . . appellate courts should

       be hesitant to disturb the delicate balance the General Assembly has reached

       and thus refrain from applying provisions not expressly included in the

       statutory scheme.” Brown, 892 N.E.2d at 649. Midwest’s argument is therefore

       unavailing.


[11]   Midwest directs our attention to two cases that consider whether a bonus is a

       wage for purposes of Indiana’s Wage Payment Statute; each found that a bonus

       was not a wage. See Herremans v. Carrera Designs, Inc., 157 F.3d 1118, 1121 (7th

       Cir. 1998); Highhouse v. Midwest Orthopedic Inst., P.C., 807 N.E.2d 737, 739-40

       (Ind. 2004). In its analysis, however, Midwest discounts the different purposes

       and goals of the Worker’s Compensation Act and the Wage Payment Statute.

       Whereas the Worker’s Compensation Act serves to aid employees following

       employment-related injuries, the Wage Payment Statute “governs both the

       frequency and amount an employer must pay its employee” for regular work

       done by the employee. McCausland v. Walter USA, Inc., 918 N.E.2d 420, 424

       (Ind. Ct. App. 2009). These two statutes are dissimilar and entirely

       independent of one another, and as a result, we do not find the reasoning in

       Herremans or Highhouse to be persuasive in the context of the Worker’s

       Compensation Act.


       Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 6 of 8
[12]   Midwest also relies on cases from Illinois and Iowa in which the courts

       considered whether a bonus should be calculated as part of an employee’s

       earnings for worker’s compensation benefits; in each case, the court found that

       the bonus should be excluded from the calculation. See Levkovitz v. Indus.

       Comm’n, 628 N.E.2d 824, 827 (Ill. Ct. App. 1993); Noel v. Rolscreen Co., 475

       N.W.2d 666, 667-68 (Iowa Ct. App. 1991). Again, we find the cases on which

       Midwest relies unpersuasive. As Midwest itself notes, the Illinois worker’s

       compensation statute specifically excludes bonuses from its definition of

       “average weekly wages,” Levkovitz, 628 N.E.2d at 827, and the Iowa worker’s

       compensation statute specifically excludes “irregular bonuses” from its

       definition of “gross earnings.” Noel, 475 N.W.2d at 667-68. Unlike those

       statutes, Indiana’s statute does not exclude bonuses from the calculation of

       average weekly wages. Accordingly, the other jurisdictions’ analyses do not aid

       our analysis of Indiana’s Worker’s Compensation Act.


[13]   Finally, we will address Garwood’s request that his award be increased by 10%.

       Indiana Code section 22-3-4-8(f) provides that “[a]n award of the full board

       affirmed on appeal, by the employer, shall be increased thereby five percent

       (5%), and by order of the court may be increased ten percent (10%).”

       Generally, an order to increase the award by 10% is not warranted unless the

       issues presented upon appeal are frivolous, appellate review is thwarted by the

       employer’s actions, or there has been an extended period of time within which

       the injured worker has been prevented from obtaining worker’s compensation

       benefits. Inland Steel Co. v. Pavlinac, 865 N.E.2d 690, 703 (Ind. Ct. App. 2007).


       Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 7 of 8
       Here, it is undisputed that the full Board granted Garwood’s award, and as we

       are affirming his award, we order his award to be increased by 5% as required

       by the Act.


[14]   Garwood argues that this Court should increase his award by 10% because

       Midwest’s argument on appeal was frivolous. We disagree. This case is one of

       first impression; neither Indiana’s Worker’s Compensation Act nor Indiana

       case law provides guidance on whether a bonus should be included in the

       calculation of an average weekly wage. Thus, the issue presented upon appeal

       was not frivolous, but rather was a genuine legal issue that required

       clarification. Accordingly, we decline to exercise our discretion to increase

       Garwood’s award by more than the 5% required by the Act.


[15]   The award of the Worker’s Compensation Board is affirmed and remanded

       with instructions to increase Garwood’s award by 5%.


       Bailey, J., and Altice, J., concur.




       Court of Appeals of Indiana | Opinion 93A02-1705-EX-1140 | November 16, 2017   Page 8 of 8
