California State Average Weekly Wage (SAWW)
Understanding how the SAWW determines your workers' compensation benefit rates
What is the State Average Weekly Wage?
The State Average Weekly Wage (SAWW) is a critical figure in California workers' compensation that directly determines the maximum and minimum amounts injured workers can receive in temporary disability (TD), permanent total disability (PTD), and life pension benefits.
Under California Labor Code Section 4453(a)(10), the SAWW is defined as the average weekly wage paid to employees covered by unemployment insurance as reported by the U.S. Department of Labor for California for the 12 months ending March 31 in the year preceding the injury.
Each year, the Division of Workers' Compensation (DWC) uses the SAWW to calculate new minimum and maximum benefit rates that take effect on January 1.
2026 SAWW and Benefit Rates
Effective January 1, 2026, benefit rates increased based on the SAWW change from $1,704 to $1,789 - an increase of 4.99%.
2026 Temporary Total Disability (TTD) Rates
| Rate Type | 2025 Rate | 2026 Rate | Change |
|---|---|---|---|
| Maximum Weekly TTD | $1,680.29 | $1,764.11 | +$83.82 |
| Minimum Weekly TTD | $252.03 | $264.61 | +$12.58 |
2026 Permanent Total Disability (PTD) Rates
The maximum permanent total disability benefit rate also increased to $1,764.11 per week for injuries occurring on or after January 1, 2026. PTD benefits are paid for life at the temporary disability rate.
How the SAWW Affects Your Benefits
Temporary Disability Benefits
Temporary disability (TD) benefits are calculated as two-thirds (2/3) of your average weekly wage at the time of injury. However, this amount cannot exceed the maximum or fall below the minimum rates set by the SAWW adjustment.
- Maximum Rate: If 2/3 of your wages exceeds the maximum, you receive the maximum ($1,764.11/week for 2026 injuries)
- Minimum Rate: If 2/3 of your wages is below the minimum, you receive the minimum ($264.61/week for 2026 injuries)
Permanent Total Disability and Life Pension
Under Labor Code Section 4659(c), workers with a date of injury on or after January 1, 2003 who receive life pension (LP) or permanent total disability (PTD) benefits are entitled to have their weekly rate adjusted annually based on the SAWW increase.
This Cost of Living Adjustment (COLA) ensures that lifetime benefits keep pace with wage growth in California. The COLA is applied to the original benefit rate each January 1.
Important Notes on COLA
- COLA only applies to injuries occurring on or after January 1, 2003
- COLA increases apply to life pension (70%+ PD) and permanent total disability (100% PD)
- If the SAWW decreases, benefit rates remain unchanged (no reduction)
- COLA is applied to the pre-reduced rate before any prior commutations
Historical California SAWW Data
The table below shows the historical SAWW values and corresponding percentage changes that have affected workers' compensation benefit rates over the years.
| Effective Year | SAWW Amount | Percent Change | Max TD Rate |
|---|---|---|---|
| 2026 | $1,789 | +4.99% | $1,764.11 |
| 2025 | $1,704 | +3.78% | $1,680.29 |
| 2024 | $1,642 | No change* | $1,619.15 |
| 2023 | $1,651 | +5.16% | $1,619.15 |
| 2022 | $1,570 | +13.52% | $1,539.71 |
| 2021 | $1,383 | +2.08% | $1,356.31 |
*In 2024, the SAWW slightly decreased from $1,651 to $1,642, so benefit rates remained unchanged from 2023. Under California law, rates do not decrease when the SAWW drops.
How SAWW Adjustments Are Calculated
The annual adjustment is calculated by comparing the current year's SAWW to the prior year's SAWW using this formula:
SAWW Adjustment = (Current Year SAWW - Prior Year SAWW) / Prior Year SAWW
2026 Calculation Example
Data:
- 2025 SAWW: $1,704
- 2026 SAWW: $1,789
Calculation:
($1,789 - $1,704) / $1,704 = 4.98826%
Result: Benefit rates increased by 4.99% for 2026
Applying to Benefit Rates
Once the percentage change is determined, it is applied to the current minimum and maximum rates to establish the new rates:
- 2025 Max TTD: $1,680.29 x 1.0498826 = $1,764.11 (2026 Max TTD)
- 2025 Min TTD: $252.03 x 1.0498826 = $264.61 (2026 Min TTD)
Why the SAWW Matters to Injured Workers
For New Injuries
If you are injured at work in 2026, your potential temporary and permanent disability benefits are capped at the rates determined by the 2026 SAWW. Higher earners particularly benefit from SAWW increases, as they may now receive more of their actual wage replacement.
For Ongoing Life Pension/PTD Benefits
If you have a date of injury on or after January 1, 2003 and are receiving life pension or permanent total disability benefits, your weekly rate should be increased each January based on the SAWW change. For 2026, this means a 4.99% increase over 2025 rates.
If Your Benefits Were Not Adjusted
If you believe your life pension or PTD benefits should have increased but were not adjusted, you may need to contact your claims administrator or seek legal assistance to ensure you receive the correct benefit amount.
Legal Authority
The SAWW and its application to workers' compensation benefits are governed by several California Labor Code sections:
- Labor Code Section 4453(a)(10): Requires the maximum and minimum weekly earnings upon which TD is based to be increased by an amount equal to the percentage increase in the SAWW compared to the prior year.
- Labor Code Section 4659(c): Requires annual COLA adjustments for life pension and permanent total disability benefits for injuries occurring on or after January 1, 2003.
- Labor Code Section 4658: Establishes the schedule for permanent disability payments, which references the SAWW-adjusted rates.
The U.S. Department of Labor publishes the SAWW data that California uses for these calculations. The California Division of Workers' Compensation (DWC) announces the new rates each fall, effective the following January 1.