The Appeal CommissionThe Workers Compensation Act of Manitoba

Applicable legislation

The WCA is a statute enacted by the Manitoba government which creates an injury and disability insurance system for workers and employers in Manitoba. The system is paid for by Manitoba employers and is administered by the WCB. The WCB has exclusive jurisdiction to examine into, hear and determine all matters arising under the WCA.

Employees of the federal government who suffer work-related injuries or disease in Manitoba receive the same benefits as other workers in the province, but not under the WCA. Their entitlement arises under the GECA.

Pursuant to subsections 4(1) and 4(2) of the GECA, a federal government employee in Manitoba is to receive compensation at the same rate and under the same conditions as a worker covered under the WCA. The legislation reads as follows:

4. (1) Subject to this Act, compensation shall be paid to

a) an employee who

i) is caused personal injury by an accident arising out of and in the course of his employment, or

ii) is disabled by reason of an industrial disease due to the nature of the employment; and

b) the dependants of an employee whose death results from such an accident or industrial disease

4. (2) The employee or the dependants referred to in subsection (1) are, notwithstanding the nature or class of the employment, entitled to received compensation at the same rate and under the same conditions as are provided under the law of the province where the employee is usually employed respecting compensation for workmen and the dependants of deceased workmen, employed by persons other than Her Majesty, who

a) are caused personal injuries in that province by accidents arising out of and in the course of their employment; or

b) are disabled in that province by reason of industrial diseases due to the nature of their employment

Responsibility for determining the compensation payable to federal employees is delegated to the WCB under subsection 4(3) of the GECA, which provides:

4. (3) Compensation under subsection (1) shall be determined by

a) the same board, officers or authority as is or are established by the law of the province for determining compensation for workmen and dependants of deceased workmen employed by persons other than Her Majesty; or

b) such other board, officers or authority, or such court, as the Governor in Council may direct.

Section 2 of the GECA defines “employee” as follows:

“employee” means

a) any person in the service of Her Majesty who is paid a direct wage or salary by or on behalf of Her Majesty.

b) any member, officer or employee of any department, company, corporation, commission, board or agency established to perform a function or duty on behalf of the Government of Canada who is declared by the Minister with the approval of the Governor in Council to be an employee for the purposes of this Act,

c) any person who, for the purpose of obtaining employment in any department, company, corporation, commission, board or agency established to perform a function or duty on behalf of the Government of Canada, is taking a training course that is approved by the Minister for that person,

d) any person employed by any department, company, corporation, commission, board or agency established to perform a function or duty on behalf of the Government of Canada, who is on leave of absence without pay and, for the purpose of increasing his skills used in the performance of his duties, is taking a training course that is approved by the Minister for that purpose, and

e) any officer or employee of the Senate, House of Commons, Library of Parliament, office of the Senate Ethics Officer or office of the Ethics Commissioner;

Framing the issues

The stated issue before the panel is: “Whether or not the injured worker should be considered an independent contractor or an employee of the employer.” Before we embark on a consideration of the stated issue, the employer has raised a threshold issue of whether or not the Manitoba Workers Compensation Board has jurisdiction to determine whether an individual is an “employee” within the meaning of the GECA and thus entitled to compensation under that statute.

Jurisdiction of Manitoba WCB to determine employee status under the GECA

As noted earlier, the Manitoba WCB has exclusive jurisdiction to determine all matters arising under the WCA. Specifically, the relevant portion of subsection 60(1) provides as follows:

General jurisdiction

60(1) The board has exclusive jurisdiction to examine into, hear, and determine, all matters and questions arising under this Part and as to any matter or thing in respect of which any power, authority, or discretion, is conferred upon the Board;

The employer in this case is a federal Crown Corporation. Any entitlement to compensation benefits for employees of federal employers must arise under the GECA, and not the WCA. The Manitoba WCB will therefore only have exclusive jurisdiction to determine employee status under the GECA to the extent that “power, authority or discretion” to make that determination has been conferred on the WCB. There are two potential sources of authority for the delegation of authority by the federal government to the WCB. They are:

(a) Subsections 4(2) and 4(3) of the GECA; and

(b) The agreement dated December 19, 1995 between Her Majesty the Queen in the right of Canada and the WCB (the “Agreement”).

Subsections 4(2) and 4(3) of the GECA

The employer argued that an individual claiming compensation under the GECA for an injury must satisfy two requirements. First, the individual must be an employee as defined in s.2 of the GECA. Second, the individual (having been found to be an employee) must have suffered an accident or industrial disease in the course of employment. If both of these two threshold requirements are met, the individual is entitled pursuant to s.4(2) of the GECA to workers compensation at the same rate and under the same conditions as established by the relevant provincial scheme. It was submitted that the correct interpretation was that s.4(2) and 4(3) of the GECA only confer on provincial workers compensation boards the authority to determine the second of the requirements for obtaining coverage under the GECA – i.e. whether the individual has suffered a work-related injury or illness. The WCB’s jurisdiction is limited to determining the amount of compensation and the conditions under which compensation will be provided to employees of the federal Crown after it has been determined by the designated federal agency (“HRSDC”) that the individual is an employee.

The contra argument is that the words “under the same conditions” in s.4(2) of the GECA are broad enough to encompass the status of being an employee and therefore the determination of “conditions” under which compensation would be provided includes determining whether an individual is an employee within the meaning of the GECA.

The Agreement

On December 19, 1995, Her Majesty the Queen in the right of Canada as represented by the Minister of Labour and the WCB entered into the Agreement for the stated purpose of defining their respective responsibilities and obligations with regard to employees of the federal government and certain Crown corporations subject to the GECA usually employed or deemed to be usually employed in Manitoba.

The Agreement states that the definitions of the terms “compensation” and “employee” have the same meanings as in section 2 of the GECA.

Paragraphs 3 and 4 of the Agreement provide as follows:

3. Object

The objective of this Agreement is to ensure that employees receive all the compensation to which they are entitled under the GECA.

4. Administration

The Board shall adjudicate claims from employees involved in an accident or affected by an occupational disease, and the responsibilities of the Minister and the Board are specified in Appendix “A”.

Appendix “A” of the Agreement reads as follows:

APPENDIX “A”

RESPONSIBILITIES

OF THE WORKERS’ COMPENSATION BOARD OF MANITOBA

AND THE MINISTER’S REPRESENTATIVE

1. BOARD

1.1 The Board shall adjudicate claims from employees and pay and provide compensation.

1.2 Before adjudicating a claim not forwarded to the Board by the Minister’s Representative, the Board shall forward to the Minister’s Representative a request, in writing, for information on employee status.

1.3 The Board shall take no action on any claim for compensation that has been stamped “election form required” by the Minister’s Representative.

1.4 Where it is probable that an election to sue shall be made by an employee, the Minister’s Representative may retain the Employer’s Report of Accidental Injury or Occupational Disease for a period of not more than two (2) months after receiving it, at which time the claim shall be forwarded to the Board for the establishment of a claim record.

1.5 The Board shall provide the Minister’s Representative with a copy of every appeal decision pertaining to an employee.

1.6 For each subrogated third-party claim, the Board shall provide the Minister’s Representative with a summary of benefits paid by the Board and such other information as the Minister’s Representative may request subject to the Board’s legislative authority to release such information.

1.7 The Board shall advise the Minister’s Representative of any substantial changes to Board procedures and information systems affecting the operation of this Agreement.

2. MINISTER’S REPRESENTATIVE

2.1 In processing claims the Minister’s Representative shall use its best efforts to ensure that all employers submit an Employer’s Report of Accidental Injury or Occupational Disease to the Minister’s Representative within three days of occurrence. The Minister’s Representative shall process claims and ensure that the Board receives the report within 48 hours.

2.2 Where the employer has not submitted an Employer’s Report of Accidental Injury or Occupational Disease but where the Board or an employee has notified the Minister’s Representative of an accident or disease or an allegation of an accident or disease, the Minister’s Representative shall use its best efforts to forward the claim for processing with 72 hours of notification.

2.3 On a semi-annual basis, the Minister’s Representative shall provide the Board with a registry of all employers subject to the GECA.

2.4 The Minister’s Representative shall use its best efforts to respond within 72 hours to all Board requests for subsequent information required to process a claim.

2.5 The Minister’s Representative shall ensure that all employers to which the GECA applies are aware of the terms of this Agreement. It shall issue guidelines to employers regarding the handling of claims with the Board.

The submission on behalf of the worker relied on the reasoning of the British Columbia Supreme Court in Canadian Broadcasting Corporation v. Luo, 2007 BCSC 971. In that case, the court ruled that the British Columbia WCAT was correct in its ultimate finding that the WCB has jurisdiction to determine employee status under the GECA. In coming to that conclusion, the court considered the Agreement to be a clearer source of jurisdiction for the WCB than was the GECA and noted the following:

• Article 1.2 of the Appendix requires the Board to request “information” on employee status from the Minister’s representative, before adjudicating a claim. The word “information” is a somewhat neutral term, comparable to the term “evidence”. If the federal government had intended to exclude the Board’s jurisdiction, it could have used a stronger term such as “decision” or “determination”. Having regard to the imperative language utilized in article 1.3, the federal government could also have included a prohibition on the Board considering a claim without a determination from the Minister’s Representative that the individual was an employee. The wording of the Agreement appears to leave it open to the Board to adjudicate issues of employee status.
• Paragraph 4 of the Agreement provides that: “The Board shall adjudicate claims.” This is broader than the language used in s. 4(3) of the GECA which speaks only of determining compensation.
• Article 1.3 of the Appendix takes the opportunity to specify that the Board will take no action on any claim for compensation that has been stamped “election form required.” If it was intended that the Board should likewise take no action on any claim where the Minister’s Representative had not made a determination of employee status, it would have been a very simple matter to state that intention.
• In Article 2.4 of the Appendix, there is mention of the Minister’s obligation to provide subsequent information required to process a claim. The only previous reference in the Appendix to information emanating from the Minister’s Representative is the information on employee status mentioned in Article 1.2. This also suggests that employee status may be a matter under adjudication by the Board.

The employer submitted that the Agreement was not intended to and cannot confer greater jurisdiction on the WCB than was provided for in the GECA, and specifically was not intended to confer on the WCB the jurisdiction to determine employee status for the purposes of GECA. The employer noted that the Agreement contemplates that both HRSDC and the WCB will have responsibility for some portion of the administration of GECA. Articles 1.1 to 1.3 and Article 2 of Appendix “A” combined, establish a system pursuant to which claims are initially assessed by HRSDC for the purpose of determining their coverage by GECA, prior to being forwarded to the WCB by the federal Minister’s Representative. Article 1.2 does not say that the Minister’s Representative will be given an “opportunity to provide input to the Board” in adjudicating the issue of employee status, which the WCB may accept or ignore as it sees fit. Article 1.2 says that the Board shall not adjudicate a claim before requesting “information on employee status” from the Minister’s Representative. It was submitted that this clearly envisions that the Board will wait for the information (i.e. conclusion) on employee status before proceeding further.

It was also noted by the employer that the practice and understanding of the parties to the GECA Agreements (namely the Minister’s Representative HRSDC and the provincial and territorial workers compensation boards) is that it is HRSDC which has the jurisdiction to determine employee status under GECA. The HRSDC guidelines published on its public website state clearly that: “HRDC determines whether the injured person is an employee for the purposes of the Government Employees’ Compensation Act. Claims are checked immediately for accuracy and completeness, countersigned, then forwarded to the appropriate provincial workers’ compensation authority. The compensation authority decides whether the disablement is the result of an occupational injury or disease, and determines the benefits to be provided.”

Panel’s Decision

After reviewing the relevant statutory provisions and the wording of the Agreement, the panel finds that the workers compensation system for federal employees established under GECA contemplates a two staged process, as submitted by the employer. The first stage concerns eligibility and an individual must be found to be an employee as defined in section 2 of the GECA before they are eligible for compensation. It is only after that threshold eligibility determination is made that decisions regarding entitlement are made.

There is no dispute that the second stage of decision making has been delegated by the federal government to provincial/territorial workers compensation boards. The issue is whether the first stage has also been delegated. When reviewing the potential sources of authority for the delegation of the threshold eligibility determination by the federal government, we find that neither the GECA nor the Agreement has definitive wording. The wording is ambiguous and can support either interpretation. The only wording which is definitive is that which is contained in the HRSDC guidelines and published on the public website. While this, of course, is not a source of jurisdictional authority, it is useful to aid in the interpretation of the Agreement. The panel also notes that Article 2.5 of the Agreement contemplates the creation of guidelines and imposes upon the Minister’s Representative the responsibility of issuing guidelines to employers regarding the handling of claims with the WCB.

In the panel’s opinion, something as significant as the delegation of a power to determine eligibility to compensation should be done clearly and expressly. The GECA is federal legislation and unless a duty or power is specifically delegated, it remains within the control of the federal government. In reviewing the legislation and the Agreement, we are unable to find any provision which clearly delegates the threshold eligibility determination to provincial compensation authorities.

We have given consideration as to whether the determination of employee status is “reasonably incidental” to the determination of “rates” and “conditions” governing compensation under the laws of the province (which has clearly been delegated to the WCB pursuant to ss. 4(2) and 4(3) of the GECA). If it is, then the argument could be made that the delegation of the threshold eligibility determination has been implicitly delegated to the WCB. We are not able to find that this determination is “reasonably incidental”. In our view, determination of employee status is a fundamental issue which opens the door to benefits. Entitlement to benefits cannot even be considered until this issue has been decided upon. It cannot be said to be merely incidental.

Overall, it is the panel’s opinion that the WCB can only have that authority over federal employees which is given to it by the federal government. As there is no clear statement that this authority has been delegated to the WCB, we find that the authority remains with the federal government, and accordingly, the WCB does not have jurisdiction to determine employee status under the GECA.

Whether or not the injured worker should be considered an independent contractor or an employee of the employer.

In case we are incorrect in our conclusion that we lack jurisdiction to consider the issue, we will address the stated issue of whether or not the injured worker should be considered an independent contractor or an employee of the employer. Both parties were given the opportunity to provide full submissions and evidence on this issue at the hearing.

The Assessment Committee applied the provisions of the WCA and the policies of the Manitoba WCB to arrive at the conclusion that the worker did not meet the criteria to be registered as an independent contractor and therefore he must be an employee of the accident employer. In the panel’s opinion, the Assessment Committee erred in attempting to apply the WCA to this situation. The proper issue for consideration is whether or not the injured worker falls within the definition of “employee” contained in s.2 of the GECA. If and only if he qualifies under this definition will he be eligible for benefits under the GECA.

As the employer in this case is a Crown Corporation (as opposed to the federal government itself), subparagraph (b) of the definition is applicable:

“employee” means

…

(b) any member, officer or employee of any department, company, corporation, commission, board or agency established to perform a function or duty on behalf of the Government of Canada who is declared by the Minister with the approval of the Governor in Council to be an employee for the purposes of this Act;

Evidence was presented to the panel which confirmed that by Order of the Governor General in Council, officers and employees of the accident employer were declared to be employees for the purposes of the GECA.

There is no further guidance contained in the GECA as to the interpretation of the term “employee”. The panel must therefore make reference to common law indicators to determine whether or not the injured worker should be considered an independent contractor or an employee of the employer.

After reviewing the evidence as a whole, the panel finds on a balance of probabilities that the status of the injured worker was more akin to that of an independent contractor, and as a result, he does not fall within the definition of “employee” as contained in the GECA. In coming to our conclusion, we rely on the following:

• The injured worker was a replacement worker hired on a temporary basis to perform the duties of a regular rural suburban mail carrier (“RSMC”) employee who was absent.
• The injured worker was paid a flat daily rate, regardless of how many hours it took to complete the job duties. The employer did not make or remit any deductions and a T4 slip was not issued. Rather, the injured worker was issued a T-1204 slip, as a contractor and he was responsible for his own income tax remittances.
• The injured worker did not receive any employment-related benefits such as vacation time, health and welfare benefits, other paid leaves, or pension benefits.
• The injured worker was recruited, trained and directed by the RSMC employee whom he replaced. The employer was not involved in the hiring of the injured worker. RSMC employees were individually responsible for finding their own replacements during periods of absence.
• The injured worker used his own vehicle to complete the job duties.
• The injured worker was not a member of the union and was not required to pay union dues.
• A considerable amount of evidence was led by the employer at the hearing detailing the collective bargaining negotiations and agreements in place between the RSMCs and the employer. It was noted that the 2006 terms of the RSMC Collective Agreement specifically provided at Article 14.02 that replacement workers: “shall not be considered an employee of the Corporation while performing such work.” While the terms of the collective agreement between the employer and its RSMCs are not determinative in interpreting the GECA, it is useful background to know that the RSMC employees were previously considered to be a class of workers who were independent contractors for the employer, and historically were not eligible for benefits under the GECA. It was only after 2004 that, by agreement between the employer and the union, the status of the RSMCs was changed from independent contractors to employees within the meaning of the GECA. When that change was made, it only applied to those individuals who were regularly employed as RSMCs. It did not apply to the replacement workers. The replacement workers remained independent contractors and remained outside of GECA coverage.
• The leave voucher which was signed by the injured worker refers to the injured worker as “the Contractor”. It also specifically provides that “the Contractor acknowledges that it is his or her sole responsibility to obtain and maintain such worker’s compensation or other coverage as may be required” and that “he or she neither is, nor shall be construed or deemed to be at any time an employee of (the employer), nor is he or she an agent of (the employer)”.
• The Tax Court of Canada has considered the status of RSMC replacement workers and has concluded that RSMC replacements are independent contractors and not employees for the purposes of the Employment Insurance Act and the Canada Pension Plan (Plant v. Minister of National Revenue, 2007 TCC 453; Sharon Laperriere v. Minister of National Revenue, 2007 TCC 252).