What constitutes a fringe benefit in Colorado?
Wages in general
Wages could include earnings from the employer, possible earnings from concurrent employment, some bonuses, the cost of continuing health insurance, and certain fringe benefits. Fringe benefits can include board, rent, housing, and lodging but the claimant must have received these benefits from the employer prior to the injury. A fringe benefit can be considered wages if the benefit has a “reasonable, present-day, cash equivalent value,” and the claimant has reasonable access to the benefit on a day-to-day basis or has an expectation interest in receiving the benefit under certain reasonable circumstances.
Value of fringe benefits
If the claimant received fringe benefits from the employer prior to the injury and the employer does not continue to provide the benefits after the injury, the claimant is most likely entitled to the “reasonable value” of these benefits. The reasonable value of housing and board may be determined by many different factors. These could include replacement costs, pier diem rates, the employer’s costs, etc. The costs need to be based on the location where the services were provided though and not where the claimant is now located. For example, if the employer was providing housing to the claimant in Alaska, the claimant would be compensated for this amount and not the cost of housing in Denver. It is the claimant’s burden to prove that fringe benefits should be included in the average weekly wage and to provide a factual basis for calculating the value of the fringe benefits.
If the claimant was provided housing or other fringe benefits by the employer at the time of the injury and the employer stops providing this fringe benefit after the injury, the claimant may be entitled to an increase in average weekly wage for the reasonable value of the fringe benefits. Discovery will need to be done to determine what fringe benefits were provided and the reasonable value of these benefits.
For further questions on this topic, please contact one of our attorneys at 720-488-9586.