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Definition of Average Daily Wage

Average daily wage (ADW), or average weekly wage (AWA), is what an employee averagely earns on a daily or weekly basis from their employer. These are the two ways in which an injured worker's earnings are calculated. These earnings are then used as the basis of what an injured worker will receive from wage loss benefits if their workers' compensation claim is approved by their employer's workers' compensation insurance company.

In most instances, it is an employee's weekly wage that is used to calculate loss wage benefits. This is done by determining an injured worker's average weekly wages over a fixed period of time. However, in instances where an injured worker's average weekly wage is not an accurate representation of their earnings, then their average daily earnings are used to calculate their loss wages benefits. In either case, in most states, loss wage benefits amount to around two thirds of these earnings.

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