IN THE SUPREME COURT OF IOWA

No. 08–0065

Filed February 12, 2010

JACOBSON TRANSPORTATION COMPANY

and LIBERTY MUTUAL INSURANCE,

Appellants,

vs.

RUSSELL HARRIS,

Appellee.

On review from the Iowa Court of Appeals.

Appeal from the Iowa District Court for Polk County, Robert B. 

Hanson, Judge.

Employee seeks further review of court of appeals’ decision 

reversing workers’ compensation commissioner’s calculation of a weekly 

compensation rate. DECISION OF COURT OF APPEALS VACATED; 

DISTRICT COURT JUDGMENT AFFIRMED.

Kevin R. Rogers of Swisher & Cohrt, P.L.C., Waterloo, for 

appellants.

Michael L. Mock of Bradshaw, Fowler, Proctor & Fairgrave, P.C., 

Des Moines, for appellee.
2

HECHT, Justice.

In this appeal, we must determine whether the workers’ 

compensation commissioner properly excluded three weeks of earnings 

from the calculation of an injured employee’s compensation rate. We 

conclude the commissioner did not err by excluding three weeks of low 

earnings and replacing them with earnings from three earlier weeks 

which more fairly represented the employee’s customary earnings. 

I. Factual and Procedural Background.

Russell Harris (Harris) was hired by Jacobson Transportation

Company (Jacobson) in April 2003 as an over-the-road truck driver. He 

was paid by the mile, and he was not guaranteed a minimum amount of 

work each week. Accordingly, the number of miles he drove each week 

varied depending on the assignments he received from Jacobson, but 

also on other factors such as traffic, speed limits, road construction, and 

weather. Harris’s weekly earnings during his employment were as 

follows:1

04/26/2003 $702.08 08/23/2003 $958.72

05/03/2003 $851.20 08/30/2003 $667.20

05/10/2003 $295.84 09/06/2003 $892.64

05/17/2003 $1117.12 09/13/2003 $247.36

05/24/2003 $764.80 09/20/2003 $1036.48

05/31/2003 $833.76 09/27/2003 $944.00

06/07/2003 $0.00 10/04/2003 $227.52

06/14/2003 $1710.08 10/11/2003 $1223.76

06/21/2003 $1068.64 10/18/2003 $0.00

06/28/2003 $538.24 10/25/2003 $1183.52

07/05/2003 $542.08 11/01/2003 $870.72

07/12/2003 $355.68 11/08/2003 $1012.00

07/19/2003 $698.59 11/15/2003 $1128.32

07/26/2003 $0.00 11/22/2003 $940.16

08/02/2003 $806.51 11/29/2003 $662.40

08/09/2003 $708.48 12/06/2003 $453.92

08/16/2003 $875.52

 1This list of Harris’s weekly earnings includes only his earnings up to the date of 

his injury, although he continued to work for Jacobson for several months after being 

injured.
3

On December 9, 2003, while unloading freight in California, Harris 

injured his low back. The injury was diagnosed as a lumbosacral and 

thoracic spine strain, and Harris was restricted to light-duty work by a

physician. Harris received a series of spinal injections after returning to 

work, but in March 2004 he was unable to continue driving because of 

the injury. 

From June 2004 through September 2005, Harris sought 

treatment from several different doctors. Their diagnoses were generally 

similar, although they disagreed about the best course of treatment and 

whether Harris had reached maximum medical improvement. Each of 

the doctors believed Harris was capable of light-duty work and 

recommended that he not return to truck driving. 

In March 2005, Harris filed a claim for workers’ compensation 

benefits. After an arbitration hearing on November 8, 2005, a deputy 

workers’ compensation commissioner determined that Harris was 

permanently and totally disabled. The deputy commissioner calculated 

Harris’s average weekly rate pursuant to Iowa Code section 85.36(6) 

(2003) by using the thirteen weeks immediately prior to his injury, 

although Harris had argued that his earnings in several of those weeks 

were nonrepresentative and should be excluded. The deputy found 

Harris’s average weekly earnings were $827.52 and his weekly 

compensation rate was $483.99.2

 2The deputy commissioner apparently excluded the week ending October 18, 

2003, in which Harris had zero earnings and replaced it with the week ending 

September 6, 2003, in which Harris earned $892.64. The exclusion of that week from 

the calculation of Harris’s wage rate has not been challenged in this case. 

 
4

Both parties appealed, Jacobson3 contending the deputy erred in 

concluding Harris was permanently and totally disabled and Harris 

contending the deputy calculated the average weekly rate incorrectly. In 

the appeal decision, the workers’ compensation commissioner agreed 

with the deputy commissioner’s finding that Harris is totally disabled. 

However, the commissioner concluded three of the thirteen weeks 

preceding Harris’s injury were not representative4 and should have been 

excluded from the calculation of Harris’s average weekly earnings. 

Accordingly, the commissioner calculated Harris’s average weekly 

earnings at $953.50 and his weekly compensation rate at $545.51.5

When calculating Harris’s weekly compensation rate, the 

commissioner cited Hanigan v. Hedstrom Concrete Products, Inc., 524 

N.W.2d 158 (Iowa 1994), noting the “purpose of weekly compensation is 

to replace the probable earnings that were lost due to the injury.” The 

commissioner then engaged in a lengthy analysis of Harris’s

compensation. 

 3Jacobson and its insurance carrier, Liberty Mutual Insurance, were 

codefendants before the agency and are copetitioners on judicial review. We refer to 

them jointly as “Jacobson” in this opinion.

4As in the deputy’s arbitration award, the commissioner’s appeal decision also 

did not include in the rate calculation the week of October 18 in which Harris had no 

earnings. Although there is some evidence in the record tending to prove Harris missed 

work in October because he was hunting, had the agency concluded Harris’s lack of 

earnings were due to personal reasons, section 85.36(6) provides the weekly earnings 

for such period “shall be the amount [Harris] would have earned had [he] worked when 

work was available to other employees of [Jacobson] in a similar occupation.” Iowa 

Code § 85.36(6). Neither the arbitration decision nor the appeal decision explains the 

exclusion of the October 18 earnings. As neither party challenges the commissioner’s 

exclusion of the week of October 18 from consideration in the calculation of the weekly 

rate, we assume without deciding for purposes of our opinion that the exclusion was 

appropriate. 

5Although the commissioner’s appeal decision found Harris’s weekly 

compensation rate was $549.90, an order nunc pro tunc was later entered conforming 

the rate to the applicable rate table.
5

The weekly earnings range from a high of $1,223.76 to a low 

of $227.52. When reviewing the distribution of earnings I 

find that there are five weeks in which claimant earned 

$1,012.00 or more per week. There were two weeks in which 

claimant earned $247.36 per week or less. Over the 30 

weekly pay periods that claimant worked for the employer 

his total earnings were $24,317.34 . . . . The weekly average 

of claimant’s total earnings is thus $810.58. For the thirteen 

weeks immediately prior to his work injury, claimant earned 

more than $810.58 in ten of those weeks.6

Jacobson sought judicial review, contending the commissioner 

erred both in determining Harris was permanently and totally disabled 

and in calculating Harris’s weekly compensation. The district court 

affirmed the commissioner’s decision. Jacobson appealed, and we 

transferred the case to the court of appeals. The court of appeals 

affirmed the disability decision, but reversed the commissioner’s 

calculation of average weekly earnings and reinstated the deputy 

commissioner’s lower calculation. We granted Harris’s petition for 

further review to address the earnings issue.

 It is concluded 

that claimant’s average weekly wage should be calculated by 

discarding the weeks ending December 6, 2003 ($453.92), 

October 4, 2003 ($227.52), and September 13, 2003 

($247.36). By discarding those three weeks and adding 

earnings for the weeks ending August 30, 2003 ($667.20), 

August 23, 2003 ($958.72), and August 16, 2003 ($875.52) 

it is concluded that claimant’s gross earnings for the period 

are $12,395.44. When divided by thirteen weeks the average 

weekly gross earnings are $953.50.

II. Scope of Review.

Our review of a decision of the workers’ compensation 

commissioner varies depending on the type of error allegedly committed 

by the commissioner. If the error is one of fact, we must determine if the 

commissioner’s findings are supported by substantial evidence. Iowa 

 6Although the commissioner states that ten of the thirteen weeks of earnings 

exceeded $810.58, our review of the earnings history indicates that Harris earned more 

than $810.58 in nine of the weeks. 
6

Code § 17A.19(10)(f); Meyer v. IBP, Inc., 710 N.W.2d 213, 219 (Iowa 

2006). If the error is one of interpretation of law, we will determine 

whether the commissioner’s interpretation is erroneous and substitute 

our judgment for that of the commissioner. Iowa Code § 17A.19(10)(c); 

Meyer, 710 N.W.2d at 219. If, however, the claimed error lies in the 

commissioner’s application of the law to the facts, we will disturb the 

commissioner’s decision if it is “[b]ased upon an irrational, illogical, or 

wholly unjustifiable application of law to fact.” Iowa Code § 

17A.19(10)(m); Meyer, 710 N.W.2d at 219. Because of the widely varying 

standards of review, it is “essential for counsel to search for and pinpoint 

the precise claim of error on appeal.” Meyer, 710 N.W.2d at 219. 

In this case, the commissioner concluded three of the thirteen 

weeks prior to Harris’s injury did not fairly reflect his customary earnings

and replaced them with weeks that he concluded did represent Harris’s

customary earnings. There is no factual dispute concerning the amount 

of Harris’s wages in the weeks prior to the injury. The dispute centers

instead on the commissioner’s interpretation of the words “customary 

earnings” in Iowa Code section 85.36(6) and his application of the law to 

the facts. Accordingly, we must first determine whether the 

commissioner has misinterpreted the law. Iowa Code § 17A.19(10)(c); 

Meyer, 710 N.W.2d at 219. If the commissioner’s interpretation of the 

law is correct, we will then review his application of the law to the facts 

to determine if it is “irrational, illogical, or wholly unjustifiable.” Iowa 

Code § 17A.19(10)(m); Meyer, 710 N.W.2d at 219. 

III. Discussion.

Iowa Code section 85.36 describes the basis for calculating a 

disabled employee’s compensation rate. “The basis of compensation 
7

shall be the weekly earnings of the injured employee at the time of the 

injury.” Iowa Code § 85.36. 

In the case of an employee who is paid on a daily or hourly 

basis, or by the output of the employee, the weekly earnings 

shall be computed by dividing by thirteen the earnings, not 

including overtime or premium pay, of the employee earned 

in the employ of the employer in the last completed period of 

thirteen consecutive calendar weeks immediately preceding 

the injury. If the employee was absent from employment for 

reasons personal to the employee during part of the thirteen 

calendar weeks preceding the injury, the employee’s weekly 

earnings shall be the amount the employee would have 

earned had the employee worked when work was available to 

other employees of the employer in a similar occupation. A 

week which does not fairly reflect the employee’s customary 

earnings shall be replaced by the closest previous week with 

earnings that fairly represent the employee’s customary 

earnings.

Id. § 85.36(6) (emphasis added).7

Jacobson alleges the commissioner misinterpreted the last 

sentence of this provision authorizing the replacement of weeks which do 

not reflect the employee’s “customary earnings.” Because Harris’s weekly 

earnings fluctuated based on the number of miles he drove and because 

Harris was not guaranteed a uniform number of miles each week,

Jacobson posits that the only customary feature of Harris’s earnings is

their variability. Accordingly, in the case of an employee like Harris, 

Jacobson argues, the statute does not authorize the commissioner to 

exclude weekly earnings simply because they are significantly lower than 

other weeks without an explanation for the low wages that provides a 

rationale beyond the expected fluctuation in miles occurring from week 

to week. 

 

 7The last two sentences, including the one at issue in this case, were added to 

the statute in 2000. 2000 Iowa Acts ch. 1007, § 2. 
8

Our goal, when interpreting a statute, is to give effect to the intent 

of the legislature. Griffin Pipe Prods. Co. v. Guarino, 663 N.W.2d 862, 864 

(Iowa 2003). To determine the intent of the legislature, we look first to 

the words of the statute itself as well as the context of the language at 

issue. Id. at 865. We seek to “interpret [the provision] in a manner 

consistent with the statute as an integrated whole.” Id. Mindful that a 

fundamental purpose of the workers’ compensation statute is to benefit 

the injured workers, we interpret chapter 85 “liberally in favor of the 

employee.” Id. 

Consistent with the remedial nature of workers’ 

compensation laws, statutes for computation of wage bases 

are “meant to be applied, not mechanically nor technically, 

but flexibly, with a view always to achieving the ultimate 

objective of reflecting fairly the claimant’s probable future 

earning loss.”

Hanigan, 524 N.W.2d at 160 (quoting 2 Arthur Larson, Workmen’s 

Compensation Law § 60.11, at 10-622 (1994) (now found at 5 Arthur 

Larson & Lex Larson, Larson’s Workers’ Compensation Law § 93.01[1][c], 

at 93–7 (2009))).

We think our decision in Griffin Pipe, interpreting section 85.36(6), 

informs our analysis here. In that case, Guarino was an hourly-paid 

employee at the Griffin Pipe plant. See Griffin Pipe, 663 N.W.2d at 864. 

The plant was closed two weeks each summer and two weeks each winter 

for maintenance and cleaning. Id. During the semi-annual plant 

closures, Guarino did not work and did not earn any wages. Id. Guarino 

was injured on the job, and although the two-week winter closure 

occurred within the thirteen weeks immediately prior to his injury, the 

commissioner concluded those two weeks did not reflect his customary 
9

earnings and replaced them with earnings from earlier weeks.8

In our review, we agreed with the commissioner’s decision to 

replace the weeks when the plant was closed. Although the closing of the 

plant was planned and routine, we explicitly rejected any distinction 

between anticipated and unanticipated occurrences causing a reduction 

in an employee’s wages.

 Id. The 

employer contended that because the plant closures were expected and 

occurred regularly, they were “customary” and accordingly Guarino’s 

resulting two weeks of zero earnings should be included in the 

calculation of his weekly earnings. 

Why a particular week may not reflect the employee’s 

customary hours is important only insofar as it might be 

relevant to whether the hours worked in that week are in fact 

customary. . . .

We agree with the agency that the issue under section 

85.36 “is whether the hours of work in any particular 

workweek are representative of the hours typically or 

customarily worked by an employee during a typical or 

customary full week of work.”

Id. at 866.

Although not in effect at the time of Guarino’s injury, we also 

discussed the 2000 amendment to section 85.36(6) which added to the 

statute the language at issue in this case. Griffin Pipe, 663 N.W.2d at 

867. We noted that while usually we presume a material change in a 

statute changes the law, we concluded this amendment was intended to 

clarify the statute because it was enacted after significant dispute within 

the legal community about the correct application of section 85.36. Id. 

Although we had previously interpreted section 85.36 to permit the 

 8Guarino’s injury occurred before section 85.36(6) was amended adding the 

sentence explicitly requiring the replacement of weeks of earnings that do not fairly 

reflect the employee’s customary earnings. However, as discussed, our interpretation of 

section 85.36(6) both before and after the amendment is relevant in this case.
10

replacement of a nontypical workweek with a typical workweek in the 

wage base calculation in Thilges v. Snap-On Tools Corp., 528 N.W.2d 614, 

619 (Iowa 1995), the issue arose again three years later in Weishaar v. 

Snap-On Tools Corp., 582 N.W.2d 177, 183 (Iowa 1998). The

amendment, explicitly adding language requiring that a nontypical week 

be replaced with a typical week of earnings when calculating an 

employee’s compensation base,

confirmed this court’s interpretation of section 85.36. . . . 

Accordingly, to determine what weeks should be included in 

the compensation rate calculation one must ask whether the 

earnings attributable to a particular week are customary, not 

whether a particular absence from work is anticipated.

Griffin Pipe, 663 N.W.2d at 867.

Thus, in our interpretation of section 85.36, both before and after 

the addition of the language at issue in this case, we have determined 

that one must look to the earnings themselves to see if they are 

customary. The reason for the variance in earnings is not determinative

of whether a week’s earnings should be replaced because they are not 

customary.9

Next, then, we must address whether an employee whose earnings 

fluctuate each week can ever have atypical weekly earnings justifying 

replacement under section 85.36(6). Jacobson argues that because 

Harris’s miles were not fixed or uniform each week, Harris’s weekly 

earnings should have been calculated using the thirteen most recent 

weeks of earnings, without regard to the amount of his average

 9The reason for nontypical wages is relevant if the employee was absent from 

work for reasons personal to the employee. As previously noted, section 85.36(6) 

provides for a different method of addressing a nontypical week of earnings due to 

personal reasons. In that case, the weekly wages must be replaced with the wages the 

employee “would have earned had the employee worked when work was available” to 

the employer’s workers performing in a similar occupation. Iowa Code § 85.36(6). 
11

earnings.10

We do not interpret the word “customary” so rigidly as to conclude 

that just because an employee’s schedule or output is neither fixed nor 

guaranteed, the employee cannot have “customary” earnings. 

“Customary” means “based on or established by custom”; “commonly 

practiced, used or observed”; or “usual.” Merriam-Webster’s Collegiate 

Dictionary 285 (10th ed. 2002). We have previously defined “customary” 

as “typical.” Griffin Pipe, 663 N.W.2d at 866. Ascertainment of an 

employee’s customary earnings does not turn on a determination of what 

earnings are guaranteed or fixed; rather, it asks simply what earnings 

are usual or typical for that employee. As discussed above, an employee 

need not justify the variance with a particular explanation. The amount 

of the variance alone, by the magnitude of its departure from the usual 

earnings of the employee, may suffice to justify the exclusion of a week’s 

earnings from the weekly rate calculation. Put another way, even an 

employee whose wages fluctuate can have an unusually low or 

abnormally high week of output and resulting earnings. We think it is 

important that when the legislature clarified its intent in the 2000 

amendment to have atypical weeks excluded from the calculation, it 

added the language to section 85.36(6) which specifically addresses the 

calculation of weekly earnings for employees paid daily, hourly, or by 

output. An employee like Harris, who is paid by output (miles driven), is 

likely to have fluctuating earnings. The fact that the legislature included 

the language authorizing the exclusion of noncustomary earnings in this 

 In effect, Jacobson advocates for a bright-line rule that 

would preclude the replacement of a week’s earnings under section 85.36 

if the employee’s earnings customarily vary from week to week. 

 10Again, Jacobson does not argue that the week ending October 18 with zero 

earnings should be included in the calculation.
12

subsection indicates it expected that even employees with variable 

earnings will on occasion have earnings that diverge from the customary.

We believe the commissioner’s interpretation of “customary 

earnings” is compatible with the legislature’s directive that injured 

employees’ weekly rate of compensation shall be based on their “average

spendable weekly earnings” at the time of the injury. Iowa Code 

§ 85.34(2), (3) (emphasis added). The legislature’s adoption of the 

concept of earnings-averaging as a first principle of rate calculation 

evidences an intention to base workers’ compensation rates on an

earnings history of several weeks that are more likely than earnings of a 

single week to fairly represent the claimant’s probable future earning 

loss. The legislature’s intent to provide even greater protection to injured 

workers with variable earnings from the harsh effects of basing the 

weekly rate of compensation on unusually low-pay weeks is clearly

evidenced by the amendment to section 85.36(6) adopted in 2000. As 

amended, the section expressly authorizes the commissioner to exclude

from the computation of average weekly earnings weeks in which injured 

employees’ earnings do not fairly represent their customary earnings.

Our interpretation of “customary earnings” is further supported by 

the fact that all calculations of Harris’s average weekly earnings, whether 

performed by either of the parties or by the agency, have replaced the 

October 18 week of zero earnings with an earlier week in which Harris 

had earnings. Although no explanation has been provided for this 

replacement, we think it demonstrates a common sense understanding of 

what is considered customary. Even for an employee like Harris whose 

earnings vary each week, a week of zero earnings is not customary. This

raises the question: If a week of zero earnings is so low that it must be 

excluded as not typical, where should the line be drawn? What of a week 
13

of $100 earnings? Because we think the determination of what earnings 

are customary will depend on the specific facts of each case, we reject a 

bright-line rule that any employee whose wages vary may not have weeks 

excluded as noncustomary. Instead, we think the determination of 

whether wages are customary under the circumstances is a matter 

expressly committed by section 85.36(6) to the discretion of the 

commissioner. Accordingly, we conclude the commissioner correctly

interpreted section 85.36(6). 

We must next decide whether the commissioner’s decision to 

replace the three weeks of Harris’s earnings was illogical, irrational, or 

wholly unjustifiable in this case. The commissioner’s appeal decision 

discloses a careful and thorough consideration of Harris’s earnings 

during each of the thirteen weeks immediately prior to the injury and a 

thoughtful comparison of how the earnings in those weeks compared 

with those paid to Harris during earlier weeks of employment with

Jacobson. After reviewing the weekly earnings and comparing them to 

the average weekly earnings for Harris’s prior career as an employee of

Jacobson, the commissioner concluded the earnings from three of the 

weeks were so low as to be not customary and replaced them with the 

immediately preceding three weeks of earnings. In deciding whether 

Harris’s earnings during the three disputed weeks were so substantially 

lower than what he usually earned as to be unrepresentative, we 

conclude the commissioner aptly compared the earnings from those

weeks with Harris’s broader earnings history. When viewed in this way, 

the three weeks excluded by the commissioner were so far afield from 

Harris’s usual earnings as to be fairly characterized as unrepresentative 

of customary earnings.
14

While we do not believe the analysis undertaken by the 

commissioner in this case is the only appropriate method of arriving at a 

determination of whether earnings are customary, we conclude it was 

reasonable under the circumstances presented here. 

Jacobson contends that even if the commissioner did not err in 

excluding the three lowest weeks of earnings, it was irrational and 

arbitrary to exclude only the lowest weeks and not the highest weeks.11

 11It should be noted at this juncture that the legislature has provided protection 

to the employer from the risk of rate calculations based on weeks of unusually high 

earnings by excluding overtime and premium pay from average weekly wage 

computations. Iowa Code § 85.36(6). 

 

As we have already noted, workers’ compensation statutes are to be 

interpreted and applied liberally and flexibly for the benefit of the worker. 

Griffin Pipe, 663 N.W.2d at 865; Hanigan, 524 N.W.2d at 160. The 

commissioner’s decision that Harris’s compensation during the three low 

weeks was exceptionally low, while the high weeks were not unusually 

high when compared to the earnings history was not arbitrary or 

unreasonable in this case. As acknowledged by the commissioner, 

nearly half of the thirteen weeks prior to the injury produced earnings of 

more than $1012.00, but only two weeks had income of $247.36 or less. 

The commissioner reasonably determined that most of the thirteen weeks 

of earnings exceeded $810.58, Harris’s average weekly earnings for his 

entire preinjury career at Jacobson. When the range of Harris’s weekly 

earnings is considered, as well as the distribution of the earnings, with 

most of the weekly earnings near the high end, the commissioner’s 

decision to replace only the three lowest weeks because they were 

significantly lower than Harris’s career average is not unreasonable. 

Given our standard of review, as well as the mandate to apply workers’ 

compensation laws to benefit the worker, we conclude the 
15

commissioner’s determination of customary earnings in this case is not 

illogical, irrational, or wholly unjustifiable. 

IV. Conclusion.

We agree with the workers’ compensation commissioner’s 

interpretation of section 85.36(6). His decision to replace three low 

weeks of earnings with weeks in which Harris’s weekly earnings fairly 

represented customary earnings was not irrational, illogical, or wholly 

unjustifiable. 

DECISION OF COURT OF APPEALS VACATED; DISTRICT 

COURT JUDGMENT AFFIRMED.