Maryland Act construed to include loss of overtime pay in loss of “wage earning capacity”

In Montgomery County v. Deibler, ___ A.2d. ___ (Md. Oct. 27, 2011), the Maryland Court of Appeals considered the issue whether the term "wage earning capacity" in L.E. sec. 9-615(a)(1) includes the capacity to earn overtime compensation so that the Commission may include such compensation in the determination of whether an employee's wage earning capacity is "less" while temporarily, partially disabled. After a thorough exercise of legislative interpretation, the Court held that overtime pay is included in "wage earning capacity."

Captain Deibler was a firefighter employed by Montgomery County. Due to work-related knee injuries, he was placed on light duty with some reduction of regular hours. However, the County increased his hourly wage and maintained all of his cost of living adjustments and benefits, so that he earned the same amount of base pay as before his injuries. However, Captain Deibler lost the ability to work 11-15 hours per week of overtime. The inability to work overtime cost him over $700 per week.

After a hearing, the Commission ordered that Captain Deibler receive temporary partial disability for the periods when he worked light duty after his injuries. The County petitioned for review by the Circuit Court for Montgomery County, which affirmed. The County then appealed to the Court of Special Appeals, however, the Court of Appeals issued a writ of certiorari before argument.

On appeal, the County argued that the ability to earn overtime is separate from the ability to work. The County argued that overtime is the product of the employer's need, not a reflection of the employee's ability to perform the tasks of a job. The County concluded that Captain Deibler's ability to work did not decrease when his overtime compensation decreased; instead, his ability to perform work to earn his pre-disability base pay remained constant.

The Court disagreed, reasoning that the statutory phrase "wage earning capacity" is concerned with whether a disabled employee has lost any part of the employee's pre-disability to earn a wage. The Court concluded that overtime pay is included in the definition of "wage."

The Court pointed out that this should not result in a windfall for the employee, since the statutory calculation of average weekly wage takes into account the time worked over the 14 weeks prior to injury.

Accordingly, the Court held that "wage", as that term is used in the phrase "wage earning capacity in L.E. sec. 9-615(a), includes compensation paid for overtime hours worked prior to temporary partial disability.

This decision is significant since police and professional firefighters in Montgomery County, and probably throughout Maryland, typically earn substantial amounts of overtime pay, as has been discussed in the local papers. However, this decision will be very significant for any other category of workers whose earnings include substantial overtime pay, such as for example nurses.