Decision #92/10 - Type: Workers Compensation
Preamble
This appeal deals with a decision made by Review Office of the Workers Compensation Board ("WCB") which determined that the worker was overpaid benefits due to an administrative error and that he was required to repay the overpayment. The worker disagreed with the decision and an appeal was filed with the Appeal Commission. A file review was held on July 28, 2010 to consider the matter.Issue
Whether or not the worker is required to repay the overpayment.Decision
That the worker is required to repay the overpayment resulting from an administrative error.Decision: Unanimous
Background
On February 20, 2009, the worker suffered a compensable injury to his left thumb in a work related accident.
On the worker's application for compensation benefits, he stated that he worked 50 hours per week and was paid piecework. He was paid bi-weekly and his regular days off were Saturday and Sunday.
The employer's accident report indicated that the worker was paid by piece work on a bi-weekly basis. The worker's regular days off varied as he was not full time. The employer noted that the worker began in their employ on January 12, 2009.
On February 24, 2009, the employer advised the WCB that the worker's period of employment salary from January 12, 2009 to February 20, 2009 was $1,499.87. The WCB accepted the claim and the worker was issued wage loss benefits.
In a memo to file dated February 24, 2009, a payment assessor incorrectly noted that the worker's period of employment was January 12 to January 20, 2009 or 1.29 weeks. Therefore, on February 24, 2009, the worker was advised that his weekly gross earnings was calculated at $1,162.69 ($1499.87/1.29 = $1162.69), that his weekly net loss of earnings was $870.25 and after probable income tax rebates, his weekly benefit entitlement was $758.03.
In a memo to file dated May 13, 2009, "average earnings information" showed that during the worker's period of employment from January 12, 2009 to February 20, 2009, his average gross weekly earnings for that period was $435.94. It stated that the average gross weekly earnings were a true reflection of the worker's loss of earnings 52 weeks per year.
In a memo to file dated May 14, 2009, the payment assessor noted that the worker was overpaid because his weekly gross earnings had been calculated incorrectly. She stated:
"FWL paid Feb 21/09-May 5/09 = 8013.46
Less FWL due Feb 21/09-May 5/09 =10(348.25)+4(49.75) = 3681.50
Overpayment = 4331.96"
On May 21, 2009, the WCB advised the worker that he was overpaid WCB benefits in the amount of $4,331.96 due to an administrative error. In a memo to file, the case manager documented the worker's agreement to repay the overpayment by $100.00 per month and when he returned to work he may be able to pay more. The worker said he had no money for rent and cannot pay any more than $100.00 per month.
On November 13, 2009, the worker appealed the WCB's decision that he was overpaid. The worker stated that his employer notified the WCB that he was being overpaid and that a correction on the overpayment was never made. He said it was not his mistake nor did he report falsely. He said he had no idea that he had been overpaid benefits.
In a decision dated December 3, 2009, Review Office determined that the worker had been overpaid and that he was required to repay the overpayment. Review Office confirmed that the overpayment resulted from an administrative error by the WCB. It stated that the issue to consider, however, was whether the error or incorrect information was so material or obvious to the worker that the worker should have recognized it.
Review Office noted that the worker was informed by the WCB on February 24, 2009 that his weekly gross earnings were established at $1,162.69. The established gross weekly earnings of $1,162.69 in the opinion of Review Office was substantially more than the pay the worker received from the employer for the three pay periods prior to his injury.
Review Office stated that it reviewed the worker's income tax returns for the years 2006 and 2007 and found that the worker earned approximately $13,000 in 2006 and $15,000 in 2007.
Review Office outlined the opinion that the established gross weekly earnings of $1,162.69 was significantly higher than the worker's regular earnings while working for his current employer and that the worker should have recognized it and reported it to the WCB. It noted that the worker's prior year's earnings are significantly less than the gross weekly earnings of $1,162.69. Review Office felt the worker should have recognized and questioned why he was being paid at a significantly higher rate than he actually earned.
Review Office was unable to confirm the worker's position that the employer informed the WCB that he was being overpaid.
On January 20, 2010, the worker appealed Review Office's decision to the Appeal Commission and a file review was arranged.
On July 28, 2010, the appeal panel met to discuss the case and requested additional information from the worker's employer prior to rendering its final decision. A response from the employer was received and was forwarded to the worker for comment. On September 22, 2010, the panel met further to discuss the case and a final decision was reached.
Reasons
Applicable Legislation and Policy
The issue before the panel was whether the worker is required to repay the overpayment of compensation benefits. Subsection 109.2 of The Workers Compensation Act (the Act) provides that where a person receives an overpayment of compensation, the board may recover the overpayment from the person. In accordance with the Act, the WCB Board of Directors established WCB Policy 35.40.50, Overpayments of Benefits which sets out principles to guide recovery of overpayments to workers. Pursuant to subsection 60.8(6) of the Act, the Appeal Commission is bound by the policies of the Board of Directors.
Section C. 3. of this policy provides that all overpayments will be pursued for recovery. It also provides a list of circumstances in which the recovery will not be pursued. Subsection (ii.) provides that an overpayment will not be pursued if it resulted from either an administrative error by the WCB, or receipt of incorrect information from an employer. However, 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.
In this case, the Review Office applied the above noted provisions, found that the worker was overpaid as a result of an administrative error and that the overpayment should be recovered. It found that the worker's gross weekly earnings are significantly higher than his regular earnings and that he should have recognized it and reported this to the WCB.
Worker's Position
The worker filed a notice of appeal dated January 20, 2010. In this notice the worker wrote "When I got injured I filled out accident papers. I wasn't told by my employer how much I should have been expecting on Workers Comp. When I received my first few cheques I just assumed that is what I was entitled to. Then I got a letter saying I had been overpaid and was to pay a large amount back that WCB had made an error."
The worker advised that "I know my employer did not give false information to WCB. So when I received the first few cheques I did not question the amount they were made out for. Therefore because the error was made by the WCB, and they were given all the proper information by my employer I feel that I should not have to pay for someone else's error."
Previously, the worker had written to the WCB on September 29, 2009 regarding the overpayment. He noted that the employer's representative advised the WCB that the worker was being overpaid. He indicated that he was appealing because the error was not his fault. He noted that he did not falsely provide any information regarding his employment status or income to the WCB. He stated that the WCB made the mistake and was notified of the mistake. In his Request for Review, the worker indicated that he had no idea he was being overpaid.
Analysis
In this appeal, the panel is only deciding whether the worker is required to repay the overpayment of benefits that he received. The panel is not addressing the issue of the worker's financial capacity to make repayment. This aspect of the overpayment has not been considered or adjudicated, therefore remains open to the worker to raise.
The issue in this appeal revolves around the question of whether the amount paid by the WCB was so material or obvious that the worker should have reported it to the WCB. The panel notes that appendix A to the Overpayments Policy provides guidance to decision makers who are dealing with overpayments that result from administrative errors. It states that errors, incorrect information or new information that the worker should have recognized and reported will normally require judgments about materiality, the worker's understanding of WCB rules and policies, and the worker's ability to communicate effectively with his employer and the WCB.
To assist in its deliberations, the panel sought information from the employer regarding the discussions on salary ranges or expectations presented to the worker at the time of hiring, as well as information on the earnings of co-workers performing the same employment. The amount of the overpayment in this case was significant. The worker's average wages for the period from January 12, 2009 to February 20, 2009, were $435.94 gross per week. The WCB, in error, calculated the worker's gross weekly earnings as $1,162.69. This sum is significantly higher than the worker had received in salary. The worker's weekly entitlement was calculated as $758.03 which was significantly more than he was receiving in wages.
The worker stated that he had no idea he was being overpaid. The panel finds that the evidence does not provide a reasonable basis for the worker to have expected that his benefits would be roughly double his earnings. The panel also finds that the payments to the worker were so significantly greater than his earnings at the time of the accident, that the worker should have realized an error had been made and sought clarification of the calculation. The worker did not contact the WCB about the benefit calculation and resulting overpayments even though overpayments continued for several weeks.
Accordingly, the panel finds that the worker is required to repay the overpayment and his appeal is dismissed.
Panel Members
A. Scramstad, Presiding OfficerA. Finkel, Commissioner
P. Walker, Commissioner
Recording Secretary, B. Kosc
A. Scramstad - Presiding Officer
Signed at Winnipeg this 28th day of September, 2010