Opinion ID: 689218
Heading Depth: 3
Heading Rank: 2

Heading: The Analogy to Workers' Compensation Law

Text: 20 Although we can find no admiralty cases on point, we do draw guidance from workers' compensation cases defining average weekly wage to include not only base salary but also average tip income. Employees in certain service professions have traditionally relied upon tips for a significant portion of their income. Waiters and waitresses, for example, might receive only the statutory minimum wage from their employer yet earn most of their income from tips. An overwhelming majority of the courts that have considered this question have determined that that tip income is recoverable as part of an individual's average weekly wage under workers' compensation laws. A recent annotation of state court opinions addressing the specific question of whether tips or gratuities should be included in average weekly wages for purpose of workers' compensation remedies notes: 21 Every court which has considered tip cases under statutes defining average weekly wage as the weekly wage earned by an employee at the time of his or her injury has determined that such tips constitute earnings and are to be factored into the calculation of compensation. 22 Jane Massey Draper, Annotation, Workers' Compensation: Tips or Gratuities as Factor in Determining Amount of Compensation, 16 A.L.R. 5th 191, 205 (1993). 3 The reasons given by an Arizona state court apply equally to Flores's situation: 23 [T]he loss of income from tips is as real as the loss of income from employer disbursements. The manifest injustice of compensating for the losses stemming from one source but not from the other has been a persuasive force in the development of [workers' compensation] law. 24 Scott v. Industrial Comm'n, 122 Ariz. 169, 171, 593 P.2d 919, 921 (Ct.App.1978). Just as it does not matter for maintenance and cure purposes whether Carnival had any hand in causing Flores's illness, so it should not matter whether Flores's income came directly from Carnival or indirectly, in the form of tips given by Carnival's passengers at Carnival's urging. 25 Carnival argues that the analogy to state workers' compensation laws is not apt, because of the differences between that system of compensation and the recovery rights of seamen. It notes that maritime labor unions have jealously guarded their basket of remedies--maintenance and cure actions, Jones Act negligence claims, and general maritime law claims of unseaworthiness--against legislative attempts to replace those remedies with a maritime equivalent to state workers' compensation schemes. Unlike seamen, who have remedies both for injuries completely unrelated to their employment and for those arising from negligence or other breaches of an employer's duties, employees under workers' compensation laws generally trade their ability to claim enhanced damages for the security of a no-fault liability system. Carnival contends that this Court therefore should not engraft the definition of wages from state workers' compensation schemes onto the maritime remedy of maintenance and cure. 26 We are not persuaded by Carnival's arguments. While different remedies apply in the workers' compensation and admiralty areas, the fact remains that the wage remedy in each seeks to compensate the injured or disabled employee for compensation lost because of absence from the job. Both measure the compensation due in terms of the worker's or seaman's lost wages. The two situations are analogous to that extent, and we find the reasoning of the workers' compensation cases persuasive. 4 Wages includes average tip income, at least where, as here, the employer and employee anticipate that tips will be a substantial part of the compensation received.