Department of Labor Sets National Average Weekly Wage

The Department of Labor (DOL) issued Industry Notice 182 setting the National Average Weekly Wage (NAWW), maximum and minimum compensation rates, and annual adjustments under Section 10(f).  Beginning October 1, 2020, the NAWW will be $816.35.  The NAWW rate is calculated based on the national average weekly wage for the three calendar quarters ending on June 30 of this year (last quarter of 2019 and first two quarters of 2020). The maximum and minimum compensation rates will be $1,632.70 and $408.18 respectively.

Finally, the Section 10(f) adjustment is set at 4.65%, an increase of 1.39% over the previous year. These increases may be surprising given the widely reported job losses resulting from the Covid-19 pandemic and the fact that the Consumer Price Index (CPI) had significant declines in March and April 2020, however, the Paycheck Protection Program may have inflated the NAWW in Q2 by keeping workers on payrolls that may have otherwise seen salary reductions, furloughs, or layoffs.  In fact, the CPI over the past twelve months ending in August 2020 was 1.3% before seasonal adjustments, a figure more in line with the Section 10(f) adjustment increase published by the DOL.

These rates are applicable through September 30, 2021.