What’s the State of the Law on AMW in Arizona?

Compliance Corner

When it comes to average monthly wages in Arizona, what does legislative- and judge-made law say about how to figure amounts and whether an expanded base should be used?

We take a look at the relevant statutes and a few cases, thanks to Cantrell v. Indus. Comm'n, No. 1 CA-IC-24-0060 (Ariz. Ct. App. 09/25/25), a case that Simply Research subscribers can access.

Statutes

A.R.S. § 23-1041(A). The commission determines a worker's disability benefits by using the worker's AMW "at the time of injury."

A.R.S. § 23-1041(G). The AMW is the average wage paid during and over the month in which the employee was injured.

Cases

Elco Veterinary Supply v. Indus. Comm'n, 668 P.2d 889 (Ariz. Ct. App. 1983). The AMW statute creates a presumptive 30-day wage period for determining AMW.

Morse v. Indus. Comm'n, 146 P.3d 76 (Ariz. Ct. App. 2006). When the evidence shows that the presumptive wage base does not realistically reflect the injured worker's earning capacity, the ALJ has broad discretion to use a wage base greater than one month, an expanded wage base. Seasonal employment, intermittent employment "or unrepresentative wages during the month before the injury" may justify an expanded wage base. 

Pettis v. Indus. Comm'n., 372 P.2d 72 (Ariz. 1962). An expanded wage base should not include periods when a worker is unable to work due to factors outside the worker's control. Therefore, time off due to layoffs, voluntary removal from the labor market or time taken off by personal choice are not subtracted. 

Davis v. Indus. Comm'n, 655 P.2d 1345 (Ariz. Ct. App. 1982). Use of an expanded base must be based on evidence that shows the earnings during the 30 days preceding injury do not truly reflect the AMW

Lowry v. Indus. Comm'n, 989 P.2d 152 (Ariz. 1999). An ALJ has discretion to choose the appropriate formula for calculating the average monthly wage from numbers easily obtained, without extrapolating or speculating about unearned wages.

Miller v. Indus. Comm'n, 546 P.2d 19 (Ariz. 1976). The test for determining whether an expanded base is called for is whether the employment, not the worker, is intermittent or erratic.

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