Nebraska Court of Appeals Addresses Evidentiary Standards for Approving Average Weekly Wage in Bortolotti v Universal Terrazzo and Tile Co.

by | Feb 14, 2019

Recently the Nebraska Workers’ Compensation Court addressed what evidence is necessary for a Plaintiff to prove applicable average weekly wages for an owner operator of a business. In Bortolotti, the Plaintiff was an owner/operator and employee of the employer – a tile company. At the trial level Plaintiff testified that he did not receive a salary but he was the employer’s sole shareholder and president. At trial he offered one page from his tax return noting that the employer was an S corporation and discussing total gross income of the corporation. However, there was no evidence regarding what business expenses were deducted from the total income of the business nor any records besides testimony of what weekly draws were taken by the Plaintiff from business earnings.

Initially the trial Court ruled that although the evidence was “great puzzlement” and the trial judge indicated that without actual tax returns, the Court was unable to verify if the business expenses had been properly deducted from the company’s gross earnings. The Court also ruled that a simple mathematical calculation did not substantiate the weekly draw testimony of the Plaintiff and given the same, the Court relied on a “more specific number” in the pleadings. This resulted in an average weekly wage of $1,399.45.

Upon appeal, the Court of Appeals indicated that there was not sufficient evidence to support such a high average weekly wage. The Court of Appeals noted that although a variety of benefits passed through to the Plaintiff from the corporation, none of these benefits were reported by the company as salary to the Plaintiff. It was noted that the Plaintiff provided little evidence to accurately compute his wages, he failed to provide income tax returns or wage documentation, and that simply demonstrating the total income of the corporation would be insufficient evidence to determine the Plaintiff’s wages as an employee. The Court of Appeals determined that Plaintiff’s testimony as to what his wages were, absent any supporting documentation, was insufficient to establish the average weekly wage.

Interestingly, the Court disputed that its earlier decision in Foster–Rettig v Indoor Football Operating, 25 Neb. App. 551 (2019) supported Plaintiff’s position that his testimony alone was sufficient to prove average weekly wage. In Foster-Rettig, the Court accepted a Claimant’s testimony alone regarding the value of lodging and meals in determining average weekly wage. However, in Foster-Rettig the Plaintiff was largely blameless as to the lack of evidence given as all that evidence was in the possession of the employer and the employer failed to provide that. In Bortolotti, the Plaintiff was the owner and operator of the company and should’ve had all of those records in his control but failed to locate or offer them.

Given the same, but also given that it was undisputed that Plaintiff received some wages, the Court of Appeals determined that pursuant to Neb. Rev. Stat. § 48-121(3) Plaintiff would qualify for the minimum weekly income benefit. The Court reversed the trial judge on the average weekly wage determination and the Plaintiff was largely left with little to any appreciable weekly benefits.

The lesson here is that in situations where there is co-mingling of ownership/employment, the Plaintiff will have the burden to provide sufficient evidence of what his or her total income is. Simply indicating the total revenue of a company will not be considered sufficient evidence for computing an average weekly wage. However, if the Plaintiff attempts to obtain this information but the employer fails to provide it, it appears that the Court will give the Plaintiff more leeway in calculating average weekly wage given that the lack of documentation is not the fault of the Plaintiff. For questions regarding calculation of average weekly wage and indemnity benefits under Nebraska law please don’t hesitate to contact Nebraska workers’ compensation attorney Paul Barta at or (402)475-1075.