To calculate the average weekly wage for workers’ comp, add up your gross earnings during the lookback period set by your state, then divide by the number of weeks in that period. Most states use the 13 weeks immediately before your date of injury, counting backward from the day before the accident. That single number drives every disability check you receive, so a small error compounds into thousands of dollars over the life of a claim.
The Basic Formula
Once you know which earnings count and how many weeks fall inside the lookback window, the math is simple:
Total gross earnings during the lookback period ÷ number of weeks in the period = AWW
If you earned $15,600 over 13 weeks, your AWW is $1,200. If two of those weeks are excluded because the plant shut down for maintenance, you’d divide $15,600 by 11 instead, producing an AWW of roughly $1,418. At a two-thirds replacement rate, that difference adds more than $140 per week to your benefit check. Getting the denominator right matters as much as getting the numerator right.
Which Earnings Count
The calculation starts with gross pay, not the smaller number that lands in your bank account. Gross pay is everything your employer pays you before federal income tax, Social Security, Medicare, and insurance premiums are withheld. The IRS treats wages, salaries, and tips as income the moment they’re earned, and workers’ compensation follows the same logic.1Internal Revenue Service. Topic No. 401, Wages and Salaries
Beyond your base hourly rate or salary, these types of pay commonly fold into the AWW:
- Overtime hours. The straight-time value of overtime hours almost always counts. In many states, the overtime premium (the extra half on top of your regular rate) is excluded, but the base-rate portion still factors in. This distinction catches people off guard and is worth verifying in your state’s statute.
- Bonuses and commissions. Regular performance-based pay counts if it’s a consistent part of your compensation rather than a one-time award.
- Tips. Reported tips count. Unreported tips typically do not, which is a strong reason to keep records.
- Employer-provided perks. Housing, on-site meals, and similar benefits with a measurable cash value may be included, but generally only if the employer stops providing them after your injury. Health insurance premiums and retirement contributions are usually excluded.
One-time signing bonuses, expense reimbursements, and gifts generally don’t count because they don’t reflect your recurring earning capacity. The guiding principle across most jurisdictions is whether the income would have continued had you kept working.
Picking the Lookback Period
The standard approach uses the 13 calendar weeks of earnings immediately before your date of injury. You start counting backward from the day before the accident, and the total gross earnings during those 13 weeks become the numerator.
If your work pattern is seasonal, cyclical, or otherwise inconsistent, many states allow a 52-week lookback instead. A landscaper who earns heavily from April through October but works minimally in winter would get a distorted picture from a 13-week window that fell entirely in the slow season. The longer period smooths those swings into a more accurate annual snapshot.
Weeks where you missed significant time for reasons unrelated to the job, like a personal illness, a planned vacation, or a temporary layoff, may be excluded from the count entirely. The goal is to capture your actual working pattern, not to penalize you for time when no work was available. If three of the 13 weeks had no earnings because the employer shut down for holiday closures, some states would divide your total earnings by 10 weeks instead of 13.
When Your Situation Changes the Inputs
New Employees
Workers who haven’t been on the job long enough to fill a full 13-week lookback face an obvious problem: there isn’t enough data. The most common workaround is the “similar employee” method. The insurer looks at what a coworker in the same role, performing the same work, earned over the full lookback period and uses that figure as a proxy.
If no comparable coworker exists, the calculation may fall back to your contracted wage rate or the actual earnings from however many weeks you did work, projected forward. These fallback methods exist so new hires aren’t stuck with an artificially low AWW simply because they hadn’t accumulated much pay history yet.
Multiple Jobs
If you hold two or more jobs when you get hurt, you need to know whether wages from the non-injury job will be included. In a majority of states, total earnings from all concurrent employers are combined when calculating your AWW, on the theory that the injury affects your ability to perform all of your work, not just the job where the accident happened. Some states require the non-injury employer to also carry workers’ compensation coverage before those wages can be combined. A handful of states only consider wages from the employer where the injury occurred.
This is one of the areas where state rules diverge most sharply, and it makes a dramatic difference. A worker earning $600 per week at one job and $400 at another has an AWW of either $1,000 or $600 depending on the rule, which translates to a benefit gap of roughly $267 per week.
Part-Time and Seasonal Workers
Part-time employees often receive an AWW that reflects only their actual hours, which means lower weekly benefits than a full-time worker in the same role. Some states, however, attempt to calculate what you would have earned at full-time hours if your part-time schedule was involuntary or if you were actively seeking additional hours. Seasonal workers generally benefit from the 52-week lookback, which captures both peak and off-season earnings and prevents the AWW from being skewed by the particular time of year the injury happened.
What the AWW Produces
Your AWW is not your check amount. To get the actual weekly benefit, the AWW is multiplied by a replacement rate set by your state. Two-thirds of the AWW (66⅔%) is the most common rate for temporary total disability, but exceptions exist. Several states use 70% to 80% of gross or after-tax wages, while a few set the rate at 60%. Using the earlier example of a $1,200 AWW at 66⅔%, your temporary total disability check would be $800 per week.
Every state also caps weekly benefits at a maximum amount, usually tied to the statewide average weekly wage and updated annually. For the 2025–2026 benefit year, maximums range from under $900 per week in some states to over $2,300 in others. If your calculated benefit exceeds the cap, you receive the cap. A high earner with an AWW of $3,000 in a state with a $1,200 maximum would receive $1,200 regardless of the formula result.
Minimum weekly benefits also exist, typically ranging from roughly $190 to $580 per week depending on the state. These floors protect low-wage workers from receiving checks too small to cover basic expenses. If the formula produces a number below the minimum, the worker receives the minimum instead.
Because caps and floors reset annually, the date of your injury locks in which year’s limits apply to your claim. An injury on June 30 and an injury on July 1 might fall under different benefit schedules if the state’s fiscal year resets on July 1.
Checking and Challenging the Number
Insurance carriers calculate the initial AWW, and they get it wrong more often than you’d expect. The most common errors include using net pay instead of gross, leaving out overtime hours entirely, ignoring a second job, using the wrong lookback period, and failing to exclude weeks with no available work. Each of these mistakes pulls the AWW downward, which reduces every benefit payment for the life of the claim.
If your AWW looks too low, start by gathering documentation: pay stubs for the full lookback period, W-2 forms, tax returns, and records from any secondary employer. Compare your total gross earnings against what the carrier used. If the numbers don’t match, you can file a dispute with your state’s workers’ compensation board or commission. Most states allow injured workers to request a hearing before an administrative law judge, who can order the insurer to recalculate using correct figures.
Timing matters. Many states impose deadlines for challenging the AWW, sometimes as short as a few months after you receive the first benefit payment. Waiting too long can lock in the wrong number permanently. Even a $50-per-week error compounds to more than $2,600 a year, so reviewing the initial calculation carefully is one of the highest-value steps you can take early in a claim.