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U.S. Supreme Court

Morrison-Knudsen v. Director, OWCP, 461 U.S. 624 (1983)

Morrison-Knudsen Construction Co. v. Director,

Office of Workers' Compensation Programs

No. 81-1891

Argued March 21, 1983

Decided May 24, 1983

461 U.S. 624


Section 2(13) of the Longshoremen's and Harbor Workers' Compensation Act (LHWCA) defines "wages" for the purpose of computing compensation benefits under the Act as meaning

"the money rate at which the service rendered is recompensed under the contract of hiring in force at the time of the injury, including the reasonable value of board, rent, housing, lodging, or similar advantage received from the employer, and gratuities received in the course of employment from others than the employer."

An employee of petitioner construction company (employer) was fatally injured while working on the District of Columbia Metrorail System. At the time of his death, the employee was covered by the District of Columbia Workmen's Compensation Act, which incorporates the LHWCA, and he was also a beneficiary of a collective bargaining agreement between the employer and his union. The employer began to pay 66 2/3% of the employee's "average weekly wage" in death benefits to his widow and minor children pursuant to the LHWCA. The widow disputed the amount of the benefits, claiming that her husband's average weekly wage included not only his take-home pay but also the 68 cents per hour in contributions the employer was required to make to union trust funds under the collective bargaining agreement for health and welfare, pensions, and training. The Administrative Law Judge rejected the widow's claim, and the Benefits Review Board affirmed, holding that only values that are readily identifiable and calculable may be included in the determination of wages, and that the employee's rights in his union trust funds were too speculative to meet this definition. The Court of Appeals reversed, holding that the employer's contributions were a reasonable measurement of the value of the benefits to the employee.

Held: Employer contributions to union trust funds are not included in the term "wages" as defined in § 2(13). Pp. 461 U. S. 629-637.

(a) The contributions are not "money . . . recompensed" or "gratuities received . . . from others" nor are they a "similar advantage" to "board, rent, housing, [or] lodging." Board, rent, housing, or lodging are benefits with a present value that can readily be converted into a cash equivalent

Page 461 U. S. 625

on the basis of their market values, whereas the present value of the trust funds is not so easily converted into a cash equivalent. The employer's cost of maintaining the funds is irrelevant in this context, since it measures neither the employee's benefit nor his compensation. Nor can the value of the funds be measured by the employee's expectation of interest in them, for that interest is, at best, speculative. Pp. 461 U. S. 630-632.

(b) The legislative history of the LHWCA, its structure, and the consistent policies of the agency charged with its enforcement, all show that Congress did not intend to include employer contributions to union trust funds in the statutory definition of "wages." Pp. 461 U. S. 632-635.

(c) A comprehensive statute such as the LHWCA is not to be judicially expanded because of "recent trends." To expand the meaning of the term "wages" to include employer contributions to union trust funds would significantly alter the balance achieved by Congress between the concerns of longshoremen and harbor workers, on the one hand, and their employers, on the other. Such an expanded definition would also undermine the goal of providing prompt compensation to injured workers and their survivors. Pp. 461 U. S. 635-637.

216 U.S.App.D.C. 50, 670 F.2d 208, reversed.

BURGER, C.J.,delivered the opinion of the Court, in which BRENNAN, WHITE, BLACKMUN, POWELL, REHNQUIST, STEVENS, and O'CONNOR, JJ., joined. MARSHALL, J., filed a dissenting opinion, post, p. 461 U. S. 638.

Page 461 U. S. 626

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