OALJ Decision Analyzing Average Weekly Wage Important for Defense Base Act Cases

A recent decision from the Office of Administrative Law Judges (OALJ) addressed the interplay between Section 10(i) and Section 10(c) of the Longshore & Harbor Workers’ Compensation Act (LHWCA) in calculating the Claimant’s average weekly wage. Section 10(i) is particularly important when dealing with Defense Base Act (DBA) cases where claimants allege psychiatric injuries (PTSD, anxiety, depression) that manifest long after their return from their overseas deployment and after their employment with DBA employers.

Claimant Didn’t Sustain Injuries While Deployed; Manifested PTSD Stateside

In this particular case, the Claimant was employed as a police trainer and firearms instructor. He was deployed to Afghanistan from 2008 through 2011, deployed to Haiti from 2011 to 2013, and then re-deployed to Afghanistan from 2013 to 2015 when his employment terminated in January 2015. During his various deployments in Afghanistan, the Claimant was constantly at risk of injury from rocket and mortar attacks. He was present for two such IED attacks in 2010 and 2014.

In January 2015, the Claimant was part of a firearms training exercise that went wrong and was allegedly forced into resigning his position. His resignation was effective January 24, 2015. At no time did the Claimant ever sustain any physical injuries while deployed.

When the Claimant returned stateside in January 2015, he began experiencing nightmares, began experiencing flashbacks, and began isolating himself from friends and family. The Claimant eventually began treating with his first psychiatrist on February 10, 2015 where he was diagnosed with severe PTSD, severe major depressive disorder, and generalized anxiety disorder.

Determining the Proper Calculation of Claimant’s Average Weekly Wage

One of several issues at the formal hearing was proper calculation of Claimant’s average weekly wage (AWW). The parties stipulated at the formal hearing that the Claimant sustained an occupational disease and not a traumatic injury; as such, the Claimant alleged that his disability did not commence until February 10, 2015. Per the ALJ, because the Claimant’s occupational disease did not immediately result in disability, Section 10(i) applied.

However, the ALJ did not mechanically apply Section 10(i) to establish the Claimant’s date of disability for purposes of calculating AWW. Instead, the ALJ looked to Section 10(c) to determine what amount “reasonably represent[ed] the annual earning capacity of Claimant.” This included Claimant’s work within the war zone, which the ALJ noted was consistent with the Benefits Review Board’s (BRB) prior holdings. The ALJ stated that Section 10(c) also required that the Claimant’s annual earnings be a “reasonable representation of his annual earning capacity.”

Essentially, the ALJ ensured that a mechanical application of Section 10(i) to establish the date of disability for AWW purposes did not violate the spirit of how the BRB and various federal courts of appeals had interpreted Section 10(c). The ALJ held that under Section 10(i), Claimant’s date of disability was February 10, 2015 (the date of his first visit with his psychiatrist) and that his annual earnings were calculated by looking at his war zone wages in the 52 weeks prior to February 10, 2015.

How the ALJ Addressed the Employer’s Arguments

In determining the date of injury under Section 10(i) and the corresponding annual earnings under Section 10(c), the ALJ also addressed the Employer’s various arguments. Of note, the ALJ was unconvinced by the Employer’s position that the Claimant’s earnings should be based exclusively on his stateside employment because there was testimony that the Claimant did not want to return to overseas employment. The ALJ was further unconvinced of the Employer’s argument that the Claimant’s “voluntary resignation” rendered the Claimant’s former employment irrelevant because there was substantial evidence that the Claimant was eligible for rehire.