On Junе 29, 1970, the plaintiff received third-degree burns to various parts of her *39 body as she was lighting floating brandy on top of coffee in her capacity as a waitress with Win Schuler’s Restaurant. She was physically incapacitated, incurred various medical and hоspital expenses, and was voluntarily paid compensation benefits by defendant Aetna Casualty & Surety Company for 44 weeks. At that time, payments were discontinued by Aetna, who contended that plaintiff was able to return to work. Plaintiff, however, claimed a disabling injury continuing beyond that period of time by petition filed in June, 1971. This petition subsequently was amended to include a claim of disabling neurosis alleged to be the result of these injuries. The hearing referee and the Workmen’s Compensation Appeal Board both found that plaintiff was totally disabled on the basis of a psychiatric condition which was precipitated by the accident, and awarded compensation accordingly.
Their application for leave to appeal hаving been granted, the defendants now appeal this adverse decision of the appeal board and raise three issues for our consideration.
The first issue raised by defendants relates to the following finding made by the appeal board:
"On the basis of Dr. Payne’s testimony and review of the facts, we find that plaintiff is totally disabled on the basis of a psychiatric condition precipitated by the accident. Chapter IV, § 431 provides no right to apportion disability in cases arising out of Chapter III injuries.”
Defendants first contend that the plaintiff’s disability should be characterized as an occupational disease rather than a single-event injury and that, therefore, apportionment should have been granted under Chapter IV, § 431 of the Workmen’s
*40
Compensation Act of 1969.
1
This contention is untenable. There is no doubt that plaintiffs difficulties arose from a single-event injury and not as a result of an occupational disease. See 1A Larson, Workmen’s Compensation Law, § 37.20,
Adams v Acme White Lead and Color Works,
Secondly, defendants argue that the apportionment provision of § 431 can be interpreted to cover Chapter III single-event injuries. We disagree.
First, the apportionment provision of Chаpter IV is clear and there is no corresponding provision in Chapter III. The entire Workmen’s Compensation *41 Act was rewritten in 1969 with the obvious intent to clarify the act. It is highly unlikely that the Legislature would provide for apportionment specifically limiting it to disabilities from "occupational diseases” and not provide a corresponding section in Chapter III if they so intended. As stated in Skowronski, supra:
"Having gone to' such lengths to maintain this distinction throughout the new act, the Legislature was obviously aware of it when it apprоved an apportionment section that mentioned only disease-caused disabilities. The legislative failure to specifically include the other kinds of disabilities, which had been repeatedly distinguished from diseases, must be viewed a deliberate exclusion from the coverage of the apportionment section. Therefore, it would be improper to consider plaintiff’s injury covered by the apportionment section. ” (Emphasis added.)
The second reason for not interpreting the statute to mandatе apportionment of single-event injuries is that apportionment is disfavored in workmen’s compensation law. See 1 Larson, Workmen’s Compensation Law, § 12.20, and 2 Larson, Workmen’s Compensation Law, § 59.20.
Having found that the Workmen’s Compensation Act does nоt allow apportionment of an employee’s disability arising from a single-event injury, we are squarely faced with defendants’ third contention. The defendants argue that the act is unconstitutional as it allows apportionment in cases of occuрational diseases but not in cases of single-event injuries, thus denying the defendants equal protection of the law.
The function of the equal protection clause under Federal and state constitutions is stated in
Fox v Employment Security Commission,
*42 "There is no doubt that State legislatures hаve a broad range of discretion in establishing classifications in the exercise of their powers of regulation. However, the constitutional guarantees of equal protection are interposed against discriminations that are entirely аrbitrary. In determining what is within legislative discretion and what is arbitrary, regard must be had for the particular subject of the State legislation. There must be a relation between the classification and the purposes of the act in which it is found.”
Thus, when a classification is alleged to deny an individual equal protection of the law, such classification as a general rule must be shown to be unreasonable. The test of reasonableness is satisfied and the statutory discrimination will not be set aside if any set of facts reаsonably may be conceived to justify it.
It would appear that a reasonable basis exists for the distinction allowing for apportionment in Chapter IV of the Workmen’s Compensation Act dealing with occupational diseases and not allowing apportionment in Chapter III regarding single-event injuries, at least as far as employers are concerned.
A possible rationale for the distinction is that occupational diseases, by their nature, are caused by harmful conditions characteristic of particular industries while single-event injuries can occur in any occupation. Thus, the Legislature, in formulating the classification, may have felt that employers who engage in particular industries which have inherent harmful conditions need preferential workmen’s compensation treatment. If these employers were not given this preferential treatment, conceivably they would not enter such industries since their workmen’s compensation insurance would undoubtedly cost more. Therеfore, the clas *43 sification can be considered as an inducement for persons to engage in these industries with their characteristic harmful conditions. As the classification can reasonably be justified upon this state of facts, the defendants are not denied equal protection.
The second issue raised by the defendants relates to the following finding of the appeal board:
"In its second argument, defendant claims error in the use of plaintiffs unreported tips as one determinant utilized in аrriving at plaintiffs average weekly wage. The thrust of the argument is that undeclared tips should not be permitted when failure to report all tips was in direct violation of defendant’s written policy and the IRS rules. This Board has stated the following in reference tо this issue:
" 'Inquiry as to whether Plaintiff has paid income tax on tips was proper at least to the extent that the question might bear on Plaintiffs credibility regarding income from tips. However, the referee erred in ruling in effect that if plaintiff had not paid tax on tips hе could not expect to have tips treated as part of his earnings in the instant case. While we have no desire to condone any failure to report income or non-payment of proper income tax, nevertheless, such cirсumstances do not warrant the exclusion of proper evidence as to income in compensation cases. If Plaintiff would successfully establish earnings through tips, such income should be taken into consideration in fixing his average weekly wage whеther or not reported as income and whether or not Federal income tax had been paid thereon. (Smith v Theodore, 1956 WCABO 236, 239.)’
"Since defendant firm was unable to produce any records which would warrant our reducing the plaintiffs estimated amount of tips and sincе its agent was unfamiliar with the base wages defendant paid during the periods of plaintiffs employment and the average amount of daily tips earned by its waitresses, we allow the Referee’s estimate to stand, which estimate thereby also finds plaintiff’s testimony to be credible.”
*44 The defendants first contend that tips should not be included at all in computing the average weekly wage. MCLA 418.371; MSA 17.237(371) states in part:
"(2) Average weekly wage means the weekly wage earned by the employee at the time of his injury, inclusive of overtime, premium pay, and cost of living adjustment, and exclusive of any fringe or other benefits which continue during disability, but in no case less than 40 times his hourly rate of wage or earning.”
In
Hite v Evart Products Co,
"Faced with the problem of construction of a similar statute, the enlightened cоurt of another state determined that 'wage’ or 'earnings’ must be deemed to include all items of compensation or advantage agreed upon in a contract of hiring which are measurable in money, whether in the form of cash or as an economic gain to the employee. Leslie v Reynold, 179 Kan 422, 430 (295 P2d 1076 , 1083). We approve this definition.”
As tips are measurable in money, we hold that they fall within the Hite definition of "wage” or "earnings” as set forth above.
Furthermore, "wage” has also been defined in part as follows:
"In computing actual earnings as the beginning point of wage-basis calculations, there shоuld be included not only wages and salary but anything of value received as consideration for the work, as, for example, tips * * * ” (Emphasis added.) 2 Larson, Workmen’s Compensation Law, § 60.12.
As to defendants’ second contention that unreported tips should not be utilized in arriving at plaintiff’s аverage weekly wage, we believe the *45 holding in Smith v Theodore, supra, represents the better policy. Tips, whether reported or unreported, still represent a part of "the proportionate extent of the impairment of [the injured employee’s] earning capacity in the employment in which [she] was working at the time of the injury,” pursuant to MCLA 418.371(1); MSA 17.237(371)(1). As the purpose of the Workmen’s Compensation Act is to compensate the employee for his lost income, unreported tips should not be excluded if the trier оf facts determines , that the reported tips do not accurately reflect the total tip income received by the employee.
In the instant case, there was evidence upon which the board could properly determine that рlaintiffs total tip income exceeded her reported tip income. The findings of fact of the appeal board will not be set aside by this Court if there is any evidence to support those findings.
Hayes v Revere Copper & Brass, Inc,
Defendants’ third issue on appeal related to thе appeal board’s award of interest at the rate of 6 percent. This issue has split our Court. In
White v Extra Labor Power of America,
Affirmed as modified herein. Costs to plaintiff, to be taxed jointly against both defendants.
Notes
MCLA 418.431; MSA 17.237(431) provides as follows:
"No compensation shall be payable for an occupational disease if the employee at the time of entering into the emрloyment of the employer by whom the compensation would otherwise be payable, or thereafter, wilfully and falsely represents in writing that he has not previously suffered from the disease which is the cause of the disability or death. Where an ocсupational disease is aggravated by any other disease or infirmity, not itself compensable, or where disability or death from any other cause, not itself compensable is aggravated, prolonged, accelerated or in any way contributed to by an occupational disease, the compensation payable shall be a proportion only of the compensation that would be payable if the occupational disease were the sole cause of the disability or death as such occupational disease, as a causative factor, bearing to all the causes of such disability or death, such reduction in compensation to be effected by reducing the number of weekly payments or the amount of such payments, as under the circumstances of the particular case may be for the best interest of the claimant or claimants.”