What Is the Average Monthly Wage (AMW)? Key Details Explained
When you’re dealing with workers’ compensation claims in Nevada, there’s one major factor directly related to it – The Average Monthly Wage (AMW)!
Whether you are receiving weekly checks or a final settlement, the AMW is the foundation. If this number is calculated incorrectly, every benefit you receive will be lower than it should be.
That’s why for any injured worker, it’s very important to know how AMW is calculated and how to make sure you’re being paid fairly.
What Is Average Monthly Wage (AMW)?
In Nevada’s workers’ compensation system, your AMW is the amount used to calculate your workers’ compensation benefits. It’s basically your average earnings per month before any accident or injury. On this basis, all your benefits under workers’ compensation are calculated.
What Benefits Does the AMW Affect?
Your AMW directly affects how much money you receive in different types of benefits.
| Benefits | What It Means For You |
| Temporary Total Disability (TTD) | Payments you receive when you are completely unable to work due to your injury |
| Temporary Partial Disability (TPD) | Payments are made if you are working light duty but making less than your pre-injury wage. |
| Vocational Rehabilitation Maintenance | Financial support while you are retraining for a new job or career. |
| Permanent Partial Disability (PPD) | The lump-sum award or monthly payments for a permanent impairment. |
TTD benefits are generally paid at two-thirds of the AMW while the worker is unable to work. PPD benefits, which compensate for permanent impairment, are also based on the AMW. As a result, an incorrect calculation can affect both short-term income replacement and long-term compensation.
How Is AMW Calculated in Nevada?
Under Nevada law (NRS 616C.420), your AMW is usually based on your earnings during the 12 weeks (84 days) before your injury. However, this isn’t always the fairest way to look at your income.
When a Longer Time Period Is Used?
Nevada law allows some flexibility. If the 12-week period doesn’t accurately show what you normally earn, for example, due to seasonal work, unpaid leave, or changing hours, the insurer can review a longer period (up to one year) to calculate a more accurate average.
What Counts as Gross Earnings?
Many workers don’t realize that wages include much more than just their base salary. Under NAC 616C.432, your gross earnings are used to find a daily wage, which is then multiplied by 30.44 to get the monthly figure.
When calculating this, the insurer should include –
- Overtime and bonuses
- Commissions and tips
- Non-cash benefits (like provided housing or meals)
What Is a Concurrent Employment Trap?
One of the most frequent mistakes we see in the calculation of average monthly wages is the failure to include concurrent employment. If you were working two jobs at the time you were hurt, Nevada law allows you to combine the wages from both employers to calculate your AMW.
Failing to report a second job or failing to have those wages included is a primary cause of underpayment. If you had multiple sources of income at the time of your injury, they all must be considered while calculating AMW.
Why You Must Double-Check the Insurer’s Calculation?
Insurance companies don’t always get your wage calculation right. They often rely on incomplete wage records provided by the employer. That’s why it’s important to review the numbers yourself; even a small mistake can reduce the benefits you receive.
- Review the Wage Determination – Don’t just accept the check. Always look at the document showing how they reached that number.
- Compare with Pay Stubs – Match the insurer’s records against your actual pay stubs and tax forms.
- Watch for Missing Compensation – Make sure bonuses and overtime from the months leading up to the injury were correctly included.
Frequently Asked Questions
1. What if I just started my job and don’t have 12 weeks of pay history?
If you haven’t worked for 12 weeks before your injury, the insurer will look at your actual period of employment or even the earnings of a similar employee in your same position to estimate what your true earning capacity would have been.
2. Does my AMW include tips and bonuses?
Yes, as long as they were reported. Nevada law allows for the inclusion of commissions, bonuses, and tips. It can even include the value of “in-kind” compensation, such as a company-provided apartment or meal allowances, as long as their value can be reasonably calculated.
If something doesn’t look right in your calculation, don’t ignore it. Speak with a trusted workers’ compensation lawyer to protect your benefits.
3. Is there a maximum amount of compensation I can receive?
Yes. Nevada has a maximum monthly wage limit that changes every year on July 1st. If your actual earnings are higher than this limit, your benefits will unfortunately be limited to the cap amount.
Takeaway
Your Average Monthly Wage (AMW) plays a key role in deciding how much you receive in workers’ compensation benefits. Even a small mistake in this calculation can reduce your payments over time.
By understanding how AMW works and taking a few minutes to review your wage details, you can confirm you’re receiving the full benefits you deserve under Nevada law.
Get Help Reviewing Your AMW Calculation With Herb Santos Jr. – Your Trusted Lawyer in Reno, NV
If you feel your injury settlement is less than it deserves, you don’t have to handle it alone. Herb Santos, Jr., a workers’ compensation attorney in Reno, can help.
With over 30 years of experience, Herb Santos Jr. has been helping injured workers in Nevada understand their rights and get the compensation they deserve. He is an award-winning attorney who takes the time to review your AMW calculation, explain things clearly, and guide you every step of the way.
Call 775-323-5200 today for a free consultation with Mr. Herb Santos Jr. and make sure your benefits are on the right track.
