Glossary · PA Workers' Comp

Wage Replacement (Indemnity Benefits)

Workers' comp payments to injured employees who cannot work, typically equal to 2/3 of the employee's average weekly wage subject to PA statutory maximums.

Definition

Wage replacement — also called indemnity benefits — are workers' compensation payments made to employees who are unable to work due to a work-related injury or illness. In Pennsylvania, wage replacement is typically calculated at 2/3 of the employee's pre-injury average weekly wage (AWW).

How PA Wage Replacement Benefits Are Calculated and What Limits Apply

Pennsylvania wage replacement is subject to minimum and maximum weekly benefit limits that are updated annually based on the statewide average weekly wage. For 2026, the maximum weekly benefit is $1,325 (check with the Bureau of Workers' Compensation for current limits).

There are several types of wage replacement under PA workers' comp law: Total Disability (for workers who cannot work at all), Partial Disability (for workers who can do some work but at reduced earnings), Specific Loss (for permanent loss of a body part), and Death Benefits (for dependents of fatally injured workers).

Wage replacement begins after a 7-day waiting period. If disability extends beyond 14 days, wage replacement is paid retroactively for the waiting period.