The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

This appeal deals with a request from an employer to be excused from the payment of a late filing penalty which was assessed due to late filing of the Annual Workers’ Earnings Report (AWER). At the employer’s request, a file review was held on October 20, 2006 to consider the matter.

Issue

Whether or not the employer should pay the WCB a late filing penalty of $533.70.

Decision

That the employer should pay the WCB a late filing penalty of $533.70.

Decision: Unanimous

Background

The employer’s AWER was signed on March 29, 2006 and was received by mail at the Employer Services branch of the Workers Compensation Board (WCB) on April 3, 2006. This was 34 days after the expected due date of February 28, 2006. A late filing penalty of $533.70 was then charged to the employer.

On April 18 and June 23, 2006, the employer asked the WCB to reverse the late filing penalty on the grounds that its office administrator had not received the appropriate forms by mail for filing and had to contact the WCB on two occasions in order to have the forms faxed. It also submitted that the employer has not been late with payments in the past.

In a decision dated August 3, 2006, the WCB’s Assessment Committee confirmed that the employer must pay the late filing penalty of $533.70. It stated in the decision that the AWER which was received by the WCB on April 3, 2006, was the original AWER as these particular forms have a certain bar code on them. The Assessment Committee further stated, “The employer stated they did not receive the AWER and asked that the WCB fax them on two separate occasions. The WCB created two new AWERs and faxed them to the employer on March 14 and 15. The original AWER was received on April 3, 2006 which was 34 days after the due date.” It is this decision that the employer is appealing to the Appeal Commission and a file review was convened.

Reasons

Employer’s Position

In support of this appeal the employer’s office administrator made a written submission.

The representative noted that in over 30 years of business the employer had not filed a late return. She also noted that the office administrator was new to the position and was dealing with a back log in excess of six months. The representative noted that the office administrator requested that forms be faxed to her but she did not receive the forms due to a fax machine which was not working properly or the faxes not being provided to her. The representative submitted that the delay in filing was due to no fault of the employer.

Applicable Legislation and Policy

The Workers Compensation Act (the Act) provides the WCB with authority to collect information from employers. The Act also permits the WCB to impose an administrative penalty on an employer where the employer refuses or neglects to provide the required information within a prescribed time. The Act also provides that relief can be granted from payment of penalties. Applicable provisions of the Act include subsections 80(1), 86(1) and (3), and 109.7(1) and (3).

Pursuant to the statutory provision, the WCB Board of Directors has made a regulation establishing an administrative penalty for late filing of an AWER. The Board of Directors has also made a policy dealing with relief from penalties. The Appeal Commission and this panel are bound by this regulation and policy.

WCB Policy 35.40.10 outlines the circumstances under which a penalty may be excused or partially relieved. It provides that:

1. Penalties

The WCB may grant relief of the penalty which would otherwise be imposed for failure to provide a payroll return or other statement required under subsections 80(1), (2) and (3), according to the following criteria:

a) A default will generally be considered excusable and relief of up to 100% of the penalty amount may be provided where the period of default is less than 5 business days. Where circumstances warrant, the 5 day period may be extended at the discretion of the Director of Employer Services.

b) A default will generally be considered excusable and relief of up to 50% of the penalty amount may be provided where the period of default is less than 30 calendar days, the employer does not have a prior history of default, and has cooperated fully with the WCB.

c) A default will generally be considered excusable and relief of up to 100% of the penalty amount may be provided where the cause of the default was beyond the control of the employer, the employer does not have a prior history of default, the employer has cooperated fully with the WCB, and the default does not extend beyond 60 calendar days.

Analysis

The issue before the panel is whether the employer should be required to pay the late filing penalty. For this appeal to be successful, the panel must find that the employer is eligible for relief in accordance with Policy 35.40.10. The panel found that the employer’s request does not meet the criteria established in this policy.

As the AWER was not received until 34 days after the prescribed time, the request must be dealt with under the criteria set out in paragraph 1. c) of the policy. Under this section there are four criteria which must be met.

The first criteria is that the cause of the default must be beyond the control of the employer. The panel finds that the facts do not satisfy this criteria. The panel acknowledges that there may be circumstances relating to the management of an employer’s office which are outside the employer’s control, but generally management of an employer’s office is within an employer’s control. In this case, the employer was provided with three copies of the AWER: the original copy mailed in January 2006, and faxed copies sent on March 14 and 15, 2006. In addition, the WCB sent a reminder letter to the employer on March 8, 2006. The panel finds that the employer had opportunities to file the return at an earlier date in terms of documents on hand, and WCB notifications and reminders. The panel finds that the late filing of the AWER is due to errors in the administrative practices of the employer which, in this case, are entirely within the employer’s control.

Although it appears to the panel that the second, third and fourth criteria have been met, as the first criteria has not been met, the employer therefore is not entitled to relief under this policy and must pay the penalty.

The appeal is denied.

Panel Members

A. Scramstad, Presiding Officer
A. Finkel, Commissioner
M. Day, Commissioner

Recording Secretary, B. Kosc

A. Scramstad - Presiding Officer
(on behalf of the panel)

Signed at Winnipeg this 7th day of December, 2006