Who Gets the Defense Base Act Cost of Living Increase
Last updated August 31, 2026 · Reviewed by Carolyn Frank
Every October 1, the Department of Labor resets the compensation rates that govern Defense Base Act claims. The reset comes from Section 10(f) of the Longshore and Harbor Workers’ Compensation Act, 33 U.S.C. § 910(f), which reaches overseas contractor claims through 42 U.S.C. § 1651(a), the provision applying the Longshore Act to Defense Base Act work.
Section 10(f) raises compensation and death benefits for permanent total disability or death, and it raises nothing else, which is narrower than most contractors expect. A contractor drawing temporary total disability while recovering from a crush injury will see the same figure on the October check as on the September one, and nothing has gone wrong when that happens. The at Friedman, Rodman & Frank, P.A. answer this question every fall.
What the Defense Base Act Cost of Living Increase Actually Raises
The Defense Base Act cost of living increase is the annual October 1 adjustment under Section 10(f), which raises permanent total disability and death benefits by the lesser of the rise in the national average weekly wage or 5 percent. Permanent total disability is a formal finding in the claim that an injury has permanently left a worker unable to earn wages in suitable work, not a description of how severe an injury feels.
The 5 percent figure is a cap. In a year when the national average weekly wage climbs 6 percent, the increase stops at 5. In a year when it climbs 2 percent, the increase is 2.
Death benefits sit in the same sentence of the statute as permanent total disability, so a surviving spouse or child receiving Defense Base Act death benefits gets the October adjustment on the same terms. That is the one group most likely to be receiving benefits long enough for the increases to compound into real money.
Why a Temporary Total Disability Check Does Not Move
Section 6(c) of the Longshore Act, 33 U.S.C. § 906(c), is the provision naming who the annual determination reaches. It applies the new figures to employees and survivors currently receiving compensation for permanent total disability or death benefits during that period, and to those newly awarded compensation during it. Temporary total disability and permanent partial disability are absent from that list.
That absence is the answer for most contractors who write to us in October. A temporary total disability claim is by its nature the stage before anyone has decided whether an injury is permanent. We do look at whether a claim has been sitting in temporary status longer than the medical record supports, because that question is worth more to a contractor than the raise is.
The Numbers the Rate Is Built From
Section 6(b) of the sets both the ceiling and the floor as percentages of the same national average weekly wage. The maximum weekly compensation is 200 percent of it, and the minimum for total disability is 50 percent, except that a worker whose own average weekly wage is lower receives that actual wage instead. A contractor whose pre-injury wage worked out to $400 a week is paid $400, not the statutory minimum.
The wage figure itself is not a forecast. Section 6(b)(3) has the Secretary of Labor determine it after June 30 each year from the three consecutive calendar quarters ending that day, which is why the number is fixed months before it takes effect and why it holds steady from October 1 through September 30.
For the year running October 1, 2025 through September 30, 2026, the Department of Labor set the national average weekly wage at $1,041.35, the maximum at $2,082.70, and the minimum at $520.68, after a 4.18 percent increase. The figures for the year beginning October 1, 2026 had not been published when this post was written. The table is national, so the same numbers apply whether your contract was performed in Kuwait or Guam.
Checking Whether Your Benefit Rate Is Right
A rate that looks wrong in October is sometimes an October problem and sometimes a sign that the average weekly wage was set too low at the start of the claim. Friedman, Rodman & Frank, P.A. represents civilian contractors injured on overseas government contracts, and we can look at how your rate was calculated and whether the adjustment should have reached it. Call (877) 448-8585 or for a free consultation. We work on contingency, and you pay no fee unless we recover benefits for you.
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