The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The worker is appealing the decision made by the Workers Compensation Board ("WCB") that his average earnings had been correctly calculated with respect to his compensation claim. A file review was held on May 25, 2016 to consider the worker's appeal.

Issue

Whether or not the worker's average earnings have been correctly calculated.

Decision

That the worker's average earnings have been correctly calculated.

Decision: Unanimous

Background

The worker has an accepted claim with the WCB for a right foot and ankle injury that occurred on October 24, 1998 during the course of his employment as a seasonal maintenance worker. Due to the nature of his ankle condition, his work restrictions, experience, transferable skills and education, the WCB determined that the worker was unemployable and has been in receipt of long term wage loss benefits.

On February 14, 2013, the worker wrote the WCB stating that he should be paid based on loss of earnings for full time employment. The worker noted his employer of record had moved to all full-time employees and he believed he would have as well.

On February 20, 2013, the WCB case manager responded to the worker's position as follows:

I am unable to authorize wage loss benefits based on full time earnings. Wage loss benefits are set up based on what earnings are at the time of the injury and compensation is not provided for a potential change in employment circumstance in a later date. Your status as a seasonal employee at the time of your injury was well established.

On April 12, 2013, the worker appealed the above decision to Review Office.

On May 22, 2013, Review Office confirmed that the worker's average earnings were calculated correctly. Review Office noted that the worker was not a full time employee of the accident employer at the time of his injury nor had he worked full time for them in the past. Review Office stated that it found no information in the Act or board policies to support or allow a change in the worker's average earnings based on his position.

Review Office noted that the worker was a seasonal employee who was not guaranteed hours. The WCB reviewed the worker's 1996 and 1997 income tax returns. He earned more income in 1996 than in 1997. Thus, the WCB used his 1996 income to calculate his gross average earnings of $294.48 per week. It noted that the worker's average earnings had been indexed annually since 2000 and that there was no error in the calculation.

The worker disagreed with Review Office's decision and an appeal was filed with the Appeal Commission. In a letter to the Appeal Commission dated November 22, 2015, the worker stated:

Just for clarification purposes, the claimant agrees with the original calculation of his claim (up until) his accident employer promoted all their part-time/seasonal workers to full-time employees. At that point, the claimant is justified in receiving full-time benefits coverage.

The claimant's position is that had the accident to his ankle (NOT) occurred, he would still be employed with his accident employer.

On May 25, 2016, a file review was held to consider the worker's appeal.

Reasons

Applicable Legislation and Policy

The Appeal Commission and its panels are bound by The Workers Compensation Act (the “Act”), regulations and policies of the Board of Directors.

The worker is appealing the calculation of his average earnings.

Subsection 4(1) of the Act provides that where a worker suffers personal injury by accident arising out of and in the course of employment, compensation shall be paid to the worker by the WCB.

Subsection 39(1) of the Act provides that wage loss benefits will be paid: "…where an injury to a worker results in a loss of earning capacity…" Subsection 39(2) of the Act provides that the WCB will pay wage loss benefits until such a time as the worker’s loss of earning capacity ends, or the worker attains the age of 65 years.

Section 45 deals with the calculation of average earnings. It provides:

45(1) The board shall calculate a worker’s average earnings before the accident on such income from employment and employment insurance benefits, and over such period of time, as the board considers fair and just, but the amount of average earnings shall not exceed the maximum annual earnings established under section 46.

WCB Policy 44.80.10.10, Average Earnings (the “Average Earnings Policy”) addresses how the WCB initially establishes average earnings. The wage loss benefits which are paid to injured workers are based on the average earnings figure. The Average Earnings Policy sets out a number of different methods which may be used to calculate a worker’s average earnings, depending on the circumstances and states that: "The method used will always be the one that best reflects the worker’s actual loss of earnings."

The formulas which may be used to establish a worker's average earnings are detailed in the Average Earnings Policy. These formulas incorporate either regular earnings at the time of the accident, average yearly earnings or probable yearly earning capacity. Again, the Average Earnings Policy states that the formula that best represents the worker's loss of earnings will be chosen.

The Average Earnings Policy describes probable yearly earning capacity as:

…the worker's projected earnings for the next twelve months. It is based on the worker's regular earnings at the time of accident as applied to the worker's established work pattern. Consistent with section 45 of the Act (1992), the probable yearly earning capacity must be based on the worker's earnings before the accident, but may be based on "income from employment and employment insurance benefits, and over such period of time, as the board considers fair and just.

Worker's Position

The worker wrote to the Registrar of the Appeal Commission on May 17, 2015 outlining his position on the issue. He submitted, in part, that:

…we {ARE NOT} challenging the calculating of the worker's average earnings by the WCB/MB up to and prior to his accident employer going forward with all {FULL TIME EMPLOYEES}. The claimant is satisfied that these calculations are done correctly to the best of his understandings. We submitted a signed agreement by the Claimants Union and his accident employer, [name of employer] which made provisions for all [employer's] workers to move into full time work employment. We are challenging his calculations from the time this agreement became effective between his accident employer [name of employer] and his Union made this agreement to allow their part time/seasonal workers to move up to full-time status…

The worker provided a written submission to the Appeal Commission dated May 18, 2016. The worker expressed concern about the employer's failure to provide information regarding the change in status of the worker's co-workers who were later transitioned from part-time to full-time employees. He was also critical of the WCB for not obtaining the information from the employer. He noted that he was able to obtain the information through his union.

In support of his positon, the worker provided a copy of a Memorandum of Agreement between the employer and his union, dated September 22, 2009. The memorandum deals with the status of Winter positions and Summer work season positions. It purports to provide a process to transition employees off of Winter positions and to fill positions with qualified employees.

The worker submitted that had he not been injured and had he continued to be employed by the employer, as a part-time employee he would have become a permanent full time employee with the employer, from 2009 onward, due to the provisions of the noted Memorandum of Agreement.

As to the employer's position that there were no guarantees of employment to the worker, the worker advised "that had the employer, [name of employer] refused to take back the claimant at any time when the time came to take back their seasonal workers, the claimant could have and would have filed a grievance through his Union." He submitted that this made the worker's employment more guaranteed than the employer states.

On the question of the calculations of his wage loss benefits, the worker submitted that:

… there are full and justified reasons for the Appeal Commission to accept his claim and allow for full time benefits.

Employer's Position

The employer's position was set out in a submission dated May 13, 2016. The employer indicated that:

• the worker was a seasonal worker and his work history from his hire date to his injury date in 1998 established a seasonal pattern of work, including lay-offs.

• at no time during his employment history were the worker's hours guaranteed by the employer nor was he employed on a fulltime basis.

The employer noted that more than a decade after his injury, the worker contends that had he not been injured, he would have worked his way up to full time employment. The employer agreed with the Review Office decision that there was no evidence to support the worker's claim that he should be considered as a full time employee. The employer also agreed that the worker's benefits have been correctly calculated.

Analysis

The issue before the panel is whether or not the worker's average earnings have been correctly calculated. As noted earlier, the Average Earnings Policy directs that the method used to establish a worker's average earnings will always be the one that best reflects the worker’s actual loss of earnings. Accordingly, in order for the worker's appeal to succeed, the panel must find that the method used by the WCB to establish the worker's average earnings does not best reflect the worker's actual loss of earnings. We are not able to make that finding. We find, on a balance of probabilities, that the worker's average earnings have been correctly calculated.

The panel considered the worker's position that he would have become a full time employee of the employer in 2009, 10 years after his injury. The panel finds this position to be highly speculative and not consistent with the Act and Policy.

The panel notes that subsection 45 (1) of the Act which deals with average earnings refers to "worker's average earnings before the accident" and "over such period of time, as the board considers fair and just". This section does not provide authority to adjust average earnings based upon a possible event 10 years after the accident.

The panel notes that subsection 45(3) of the Act refers to situations where "average earnings before the accident do not fairly represent" the earning capacity of a worker. However this subsection is limited to workers who are apprentices in a trade or occupation at the time of the accident. The worker does not fall within this subsection.

The panel also notes that subsection 45(4) provides for adjustments in the case of youthful workers and again finds that it is not applicable to the worker.

Schedule D of the Policy deals with "probable yearly earning capacity". This worker's situation is not covered under this provision.

The panel has reviewed the actual calculation of the worker's average earnings. We note that the WCB reviewed the worker's 1996 and 1997 income tax returns. As the worker's 1996 income was greater than his 1997 income, the WCB used the worker's 1996 income to calculate his gross average earnings. The panel notes that the worker's average earnings have been indexed annually since 2000. The panel finds that the worker's average earnings have been correctly calculated and adjusted.

The worker's appeal is dismissed.

Panel Members

A. Scramstad, Presiding Officer
A. Finkel, Commissioner
P. Walker, Commissioner

Recording Secretary, B. Kosc

A. Scramstad - Presiding Officer

Signed at Winnipeg this 29th day of July, 2016