The Appeal CommissionThe Workers Compensation Act of Manitoba

Background

On September 18, 2003, the worker suffered a compensable injury. When he returned to work with the accident employer, he was given a new position with lower wages and the WCB paid him wage loss benefits based on the difference between his pre-accident earning capacity and his post-accident earnings.

The amount of partial wage loss benefits paid by the WCB was based, in part, on an agreement between the accident employer and the worker as to his hourly wage for the period between February 6, 2006 and August 8, 2006; for the period between February 6, 2006 and May 10, 2006, the employer was to pay 50% of his salary and the WCB would pay partial wage loss on the balance (50%); from May 11, 2006 to August 8, 2006, the employer was to pay 75% of his salary and the WCB would pay partial wage loss on the balance (25%). After that period of time, the employer would pay the worker’s full salary at the reduced hourly rate and the WCB would pay partial wage loss on the difference between the reduced hourly rate and his pre-accident hourly rate.

During the course of 2006, the worker’s wife provided copies of the worker’s pay stubs to the WCB. Several adjustments were made to the amount of partial wage loss paid to the worker based on information that had been provided by the worker or his spouse and instructions from the case manager. On one such occasion, the WCB case manager advised the worker on July 27, 2006 that his wage loss was calculated incorrectly but that there was no resulting overpayment.

The amount of the benefits paid and the wages paid by the accident employer were reviewed in 2006 in accordance with WCB policy. During this review, the following were noted:

• $700.00 of vacation time that was initially included in the calculation of the worker’s total earnings was subtracted by the case manager on February 24, 2006. This action resulted in an adjustment of $237.98 paid to the worker. The review noted that this $700 should have been included in the worker’s total earnings as it was considered salary.

• The worker’s wage loss benefits were calculated on the basis of 90% of his salary instead of 80% as required by legislation. The decrease to 80% should have been implemented on February 13, 2006. It was not done until February 18, 2006.

• Between May 11, 2006 and July 22, 2006, the WCB paid the worker partial wage loss benefits based on assumed earnings of $180.00 per week rather than $360.00 that was supposed to be paid by the accident employer in accordance with the above-referenced agreement.

• Between May 11, 2006 and July 11, 2006, when the worker was supposed to have been paid $360.00 per week by his accident employer, he was actually paid an average weekly amount of $446.97.

In calculating the overpayment resulting from the above, the WCB noted that the worker was overpaid $2,711.91. This amount was reduced to $2,387.91 based on an amended T4 summary that was provided to the WCB. In reviewing the factors that led to the overpayment, Review Office found that all of the above, except the last factor, were due to WCB errors and adjustments and should therefore be borne by the WCB. The last factor was however due to an unexpected increase in earnings and should be borne by the worker. The total amount of this overpayment was $485.26.

Worker’s Position

The worker does not dispute that he received an overpayment. He says however that he should not have to repay it as:

• The overpayment is due to an administrative error.
• His wife provided his pay stubs on a bi-weekly basis and the WCB should have caught the error.
• He was told by his case manager that there was no overpayment as a result of the increased earnings.

Analysis

Subsection 39(1) of The Workers Compensation Act (the “Act”) provides that a worker who suffers a loss of earning capacity as a result of the workplace accident is entitled to wage loss benefits calculated in accordance with section 40 of the Act.

In the worker’s case it was determined that the worker received more benefits than he was entitled to under the Act. The panel agrees with that determination based on the evidence on file.

WCB Policy 35.40.50, Overpayments of Benefits deals with situations where the WCB may and will seek recovery of overpayments. Part C, 3 of that policy provides that all overpayments will be pursued for recovery unless:

“(i.) they resulted from an adjudicative reversal or a reconsideration decision by the WCB, or from a decision of the Appeal Commission; or

(ii.) they resulted from either an administrative error by the WCB, or the receipt of incorrect information from an employer that affected eligibility or the amount payable. The exception to this provision is that the overpayment will be pursued if the WCB considers that the error or incorrect information was so material or obvious that the worker should have recognized it and reported it to the WCB; or

(iii.) new information relevant to entitlement was known to the worker and was not provided to the WCB, but it resulted in an overpayment of less than $50; or

(iv.) the amount receivable is not cost-effective to pursue; or

(v.) recovery of the overpayment, in whole or in part, would create financial hardship for the worker and/or the worker’s dependants; or

(vi.) the worker has died, unless it is clear that the estate has sufficient funds available to repay the overpayment; or

(vii.) the overpayment occurred more than three years prior to its discovery by the WCB.”

As mentioned above, we do find that there was an overpayment of $2,387.91. We also agree that the majority of this overpayment is due to administrative errors by the WCB and that this portion of the overpayment should be borne by the WCB.

With respect to the $485.26 that the WCB is seeking to recover, we find that this overpayment is not due to an administrative error. Rather it is due to an increased payment by the accident employer to the worker without the WCB’s prior knowledge. This information was available to the worker at the time he was paid this increased salary. It was not however communicated to the WCB until the end of July 2006. This overpayment does not meet any of the seven exclusions noted in the policy and therefore the panel finds it should be repaid by the worker.

As to the worker’s submission that his WCB case manager advised him that there was no overpayment, the panel notes that positions advanced by WCB personnel are not binding on the WCB; it is available to the WCB to correct adjudicative errors both at the primary adjudication and Review Office levels, as well as at the Appeal Commission level.