W.C. No. 4-224-515Industrial Claim Appeals Office.
February 28, 1996
FINAL ORDER
The respondents seek review of a final order of Administrative Law Judge Friend (ALJ) insofar as it determined the claimant’s average weekly wage. We affirm.
The ALJ found that the claimant was a resident of Denver. However, at the time of the injury, the claimant was working at a remote job site in Leadville.
The claimant was regularly paid $12.00 per hour. However, because the claimant was required to work more than fifty miles from the Denver metropolitan area, the claimant received what the ALJ called a “travel allowance of $3.00 per hour for each hour worked.” The ALJ found that the “travel allowance” was “additional compensation for working at this remote site.”
Under these circumstances, the ALJ calculated the claimant’s average weekly wage to be $600.00 per week. This was predicated on the $12.00 per hour rate for forty hours per week, and the travel allowance of $3.00 per hour for forty hours per week.
On review, the respondents contend that the ALJ erred in incorporating the $3.00 per hour “per diem” payments in the claimant’s average weekly wage. The respondents assert that those amounts were “designed and intended to cover the cost of living expenses,” and therefore, constitute “per diem” payments. Thus, the respondents reason that the payments are excludable from the claimant’s wages under § 8-40-201(19)(c), C.R.S. (1995 Cum. Supp.), because there is no evidence that the payments were considered “wages for federal income tax purposes.”
The respondents’ contention notwithstanding, we are not persuaded by the argument that the $3.00 per hour payments to the claimant constitute “per diem payments” within the meaning of § 8-40-201(19)(c). In Olney v. Ernie Baylog, Inc., W.C. No. 4-222-552, November 1, 1995, we held that the term “per diem payment,” as used in 8-40-201(19)(c), refers to a payment or allowance of “so much per day.” We noted that this definition of “per diem” is consistent with the plain and ordinary meaning of the term. Moreover, we stated that the definition is consistent with the use of the term in § 8-42-102(2)(c), C.R.S. (1995 Cum. Supp.), as well as the case law. See Newbury v. Vogel, 151 Colo. 520, 379 P.2d 811 (1963); Western Cultural Resource Management, Inc. v. Krull, 782 P.2d 870 (Colo.App. 1989). Because we determined in Olney that the term “per diem” refers to a flat “per day payment,” we rejected the argument that a payment of four cents “per mile” constituted a “per diem” payment for purposes of §8-40-201(19)(c).
Here, the ALJ found that the disputed payments to the claimant were not “per diem” payments, but rather hourly payments. Thus, the ALJ could logically conclude that the payments bore a direct relationship to the amount of service performed by the claimant, but no direct relationship to the claimant’s daily travel and lodging expenses. Thus, the ALJ correctly ruled that the $3.00 per hour payments do not constitute “per diem” payments which are excludable from the average weekly wage under §8-40-201(19)(c).
In any event, we agree with the claimant’s argument that the record contains evidence indicating that the $3.00 per hour payments were considered taxable for federal income tax purposes. Exhibit H, the claimant’s pay stub, indicates that the payments were considered part of the claimant’s “total pay,” which was in turn subject to federal withholding. Thus, the record does not support the respondents’ assertion that there is “no evidence” that the payments were taxable.
The respondents also argue that a “travel allowance,” which is payable as “expense reimbursement,” cannot constitute part of the claimant’s salary for purposes of determining the average weekly wage. The respondents cite foreign authority for the proposition that “reimbursement” for travel expenses does not represent lost earning capacity. This argument is without merit.
Section 8-40-201(19)(a), C.R.S. (1995 Cum. Supp.), defines wages as the “money rate at which the services rendered are recompensed under the contract of hire in force at the time of the injury.” Under this statute, an employer may not arbitrarily designate a portion of the claimant’s money wages as reimbursement for expenses so as to exclude such “reimbursement” from the average weekly wage. Sneath v. Express Messenger, 881 P.2d 453
(Colo.App. 1994); Filippone v. Industrial Commission, 41 Colo. App. 322, 590 P.2d 977 (1978). This is particularly true where the record does not demonstrate any realistic or rational relationship between the claimant’s actual expenses and the amount asserted to be “reimbursement.” Sneath v. Express Messenger, supra.
Here, the evidence reveals that the claimant was living at a campsite while working in Leadville, and the respondents offered no evidence whatsoever concerning the expenses which the claimant incurred while working at the remote site. Moreover, there was evidence that the claimant did not always work forty hours per week. (Tr. 65). Thus, the claimant could incur expenses without reimbursement. Under such circumstances, the ALJ could logically find that the $3.00 per hour payments constituted extra compensation for the claimant’s presence at the remote site, not “reimbursement” for his expenses.
IT IS THEREFORE ORDERED that the ALJ’s order dated February 3, 1995, is affirmed.
INDUSTRIAL CLAIM APPEAL PANEL
___________________________________ David Cain
___________________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate the Order iscommenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver,Colorado 80203, by filing a petition to review with the court, withservice of a copy of the petition upon the Industrial Claim Appeals Officeand all other parties, within twenty (20) days after the date the Orderwas mailed, pursuant to §§ 8-43-301(10) and 307, C.R.S. (1995 Cum.Supp.).
Copies of this decision were mailed February 28, 1996 to the following parties:
Eloy C. Chaparro, 6901 E. 70th Ave., Commerce City, CO 80022
Spray Systems of Arizona, 1616 S. Edward Dr., Tempe, AZ 85281-6235
Suzanne Harris, AIG Claim Services, Inc., P.O. Box 32130, Phoenix, AZ 85018
Nathan M. Berger, Esq., 7201 Monaco, Commerce City, CO 80022 (For the Claimant)
Joel S. Babcock, Esq., 400 S. Colorado Blvd., Ste. 700, Denver, CO 80222 (For the Respondents)
By: ____________________