Lost Wages In Wisconsin Workers’ Compensation: How They Impact You

Last updated on February 6, 2026

In Wisconsin, when an injured employee is off work completely during their healing period, the worker is eligible for temporary total disability (TTD) benefits. While there may be a complete wage loss, workers’ compensation is not a 100% wage replacement; it is calculated at two-thirds (2/3s) of your pre-injury average weekly wage. An employee will collect this TTD amount every week for as long as a doctor or physician indicates they are still healing and recovering from the effects of their injury.  TTD is a tax-free benefit.

“Many workers’ compensation benefits are intended as some type of income replacement for the injured worker. In calculating the available benefits, the starting point, therefore, is the worker’s average weekly wage.” – Tom and Charlie Domer, from their book, “Wisconsin Workers’ Compensation Law.”

Calculating the average weekly wage, however, is not always a straightforward calculation. All too frequently, we see either the employer or insurance company underestimate this average weekly wage or fail to factor in overtime, resulting in more lost wages for you. If your employer tried to talk you into using your sick pay while you recover from an on-the-job injury or your consistent overtime was not calculated in determining your average weekly wage, you should talk to an attorney to ensure that you get the benefits you deserve.

How Is The “Average Weekly Wage” (AWW) Calculated In Wisconsin?

Your average weekly wage (AWW) is the foundation of your lost wage benefits–as the TTD rate is ⅔ of the AWW. Insurance companies use it to calculate how much you receive each week. Even small errors can cost you thousands over the life of a claim.  Given that TTD is not full income replacement, an injured worker needs to be sure the AWW is calculated appropriately from the jump.

Wisconsin law provides rules meant to protect injured workers, but employers and insurers sometimes can apply them incorrectly.

In most cases, the AWW is determined as the greater of (1) the hourly rate x full–time hours in a a week; or (2) the average of the 52-week wages before the injury.

The 100% Rule For Full-Time Workers

In determining a “full-time” week, Wisconsin law generally treats employment settings as a 40 hour week.  Therefore, unless the employer definitively establishes a lesser set amount of hours for “full time” workers, Wisconsin law will expand your hours to a 40-hour employee, even if you work fewer hours.

For example, if you were hired as a full-time employee but generally worked 35-37 hours per week, your AWW may still be calculated based on a full 40-hour week. This rule prevents employers from reducing benefits simply because of sporadic scheduling practices.

Note that part-time workers have specific rules for calculating AWW–depending on whether the worker restricted themselves to part-time work and whether they worked for more than one year of more at the injury employer.

Overtime And Bonuses Generally Is Included

Overtime pay, shift differentials and certain bonuses often count toward your AWW. Wisconsin law looks at your highest-earning (“best”) weeks, not just an average across low-earning periods. If a worker was employed for more than 6 weeks before the injury, the AWW looks at the average of the weeks worked up to the past 52 weeks. Such a calculation will include overtime earnings for most workers. Insurance companies frequently leave out overtime or use the wrong weeks, which lowers benefit payments.

Other Benefits

Workers should also be aware of other items of value that can increase their AWW like tip income, profit sharing, and employer-paid lodging or meals. Unfortunately, a worker’s employer-paid health insurance is not part of their AWW, nor is employer contributions to a 401(k).

What Are The Different Types Of Lost Wage Benefits In Wisconsin?

Wisconsin workers’ compensation provides several forms of wage replacement, depending on how your injury affects your ability to work. These include:

• Temporary Total Disability (TTD): TTD benefits apply when you cannot work at all during your healing period. These benefits generally equal two-thirds (66.67%) of your AWW and continue as long as your doctor says you are unable to work.
• Temporary Partial Disability (TPD): If you return to work with restrictions or reduced hours, TPD benefits may apply. These benefits cover a portion of the wages you lose while recovering.
• Loss Of Earning Capacity (LOEC): LOEC benefits apply when permanent work restrictions prevent you from earning 85% or more of your pre-injury wages. These cases often involve injuries to the head, neck or torso. If your employer cannot provide suitable work within your restrictions, you may qualify for LOEC benefits.
• Permanent Total Disability (PTD): PTD benefits apply when you are permanently unable to work in any capacity. These benefits generally pay two-thirds of your AWW for life.

Understanding which wage-loss category applies to your case is critical. Each type of benefit has its own rules, timelines and proof requirements. When a claim is placed in the wrong category, workers often receive less than the law allows or nothing at all.

Insurance companies make these decisions early, and they rarely revisit them unless challenged. With that in mind, having someone review your wage classification and medical restrictions early can help protect your income and prevent long-term losses.

Call The Lawyers Who Wrote The Book On Workers’ Compensation Law

Call the experienced attorneys of Domer Law, S.C., who wrote the book “Wisconsin Workers’ Compensation Law.” It’s the topic of law we know inside and out.

TTD benefits apply during the healing period, as deemed by a doctor, and only your doctor can determine how long your healing period will be. If you return to work at lower wages, you deserve temporary partial disability benefits during the healing period.

Contact Us Today

If you have applied for workers’ compensation and still have not heard a reply after two weeks, call us. The insurance company may have denied your claim, and you are going to need experienced legal help on your side.

At Milwaukee-based Domer Law, S.C., our lawyers represent injured workers throughout the state of Wisconsin. Call our office at 262-333-1938 or contact us online.