The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The worker is appealing the decision made by the Workers Compensation Board ("WCB") regarding the calculation of his initial benefit rate. A file review was held on June 1, 2016 to consider the worker's appeal.

Issue

Whether or not the worker's initial benefit rate for the first 12 weeks has been correctly calculated.

Decision

That the worker's initial benefit rate for the first 12 weeks has been correctly calculated.

Decision: Unanimous

Background

The worker has an accepted claim with the WCB for injuries sustained on September 2, 2015 during the course of his employment as a fisher.

On October 14, 2015, based on information provided by the worker and the employer, the WCB initially calculated the worker's wage loss benefits as follows:

INCOME LEVELS WEEKLY ANNUAL

Gross: $148.08 $7,700.16

Net Loss of Earn: $141.30 $7,347.49

100% Net Actual: $141.30

Tax Sheltering: $ 0.83

100% Net Sheltered: $140.47

In discussion with a WCB adjudicator on October 20, 2015, the employer advised that they rehired the worker on September 1, 2015 and his wages from that date to September 2, 2015 were $300.00. The worker was not guaranteed hours or days of work each week and only worked when he was needed or when he was available, weather permitting.

Based on this information, the worker was notified on October 20, 2015 that his weekly gross earnings were now established at $300.00 per week, calculated as follows:

INCOME LEVELS WEEKLY ANNUAL

Gross:     $300.00     $15,600.00

Net Loss of Earn:     $262.89     $13,670.07

100% Net Actual:     $262.89

Tax Sheltering:     $13.87

100% Net Sheltered:     $240.02

On November 4, 2015, the worker appealed to Review Office as to the calculation of his weekly earnings, stating his average earnings should be calculated based on a five or seven day work week instead of the two days he worked immediately before the accident.

On January 15, 2016, Review Office considered the worker’s appeal and determined that based on the evidence, the Act and applicable policies, it was unable to find that the average earnings of the worker was based on inaccurate information or was calculated incorrectly. Review Office was satisfied that the "First Payment" section of the Policy and the method used were correctly applied by the WCB in establishing the initial benefit rate for the first 12 weeks. Based upon file evidence, Review Office determined that the worker's initial benefit rate for the first 12 weeks was correctly calculated.

On January 24, 2016, the worker appealed the decision to the Appeal Commission and a file review was arranged.

Reasons

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.

Subsection 39(1) of the Act provides that where an injury to a worker results in a loss of earning capacity, wage loss benefits are payable in accordance with section 40. Subsection 40(1) sets out that the loss of earning capacity of a worker is the difference between the worker's net average earnings before the accident, and the net average amount that the board determines the worker is capable of earning after the accident.

Subsection 45(1) explains that "… [t]he 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…."

The process for calculating "Average Earnings" is set out in WCB Policy 44.80.10.10, Average Earnings (the "Policy"). The Policy provides that in calculating a worker's average earnings under section 45 of the Act, the WCB will use formulas that incorporate regular earnings at the time of accident, average yearly earnings or probable yearly earning capacity. The Policy requires that the formula that best represents the worker's loss of earnings be used.

The "First Payment" section of the Policy provides for how a worker's average earnings are calculated at the time of first payment. The Policy states:

At the time of first payment, the WCB will apply the average earnings formula which, on the basis of verifiable information readily available to the WCB, allows for:

a) Expeditious payment of benefits; and

b) Reasonable approximation of the worker's average earnings at the time of the accident. In most cases this formula will be the regular earnings at the time of accident, although the WCB may use the average yearly earnings if it has sufficient documentation and the resultant average earnings would be greater.

The Policy defines “average yearly earnings” as including any remuneration that the worker received as a result of employment or employment insurance benefits, as determined generally by documentable employment data from any consecutive 12-month period during the one or two years before the compensable accident.

"Regular earnings" are defined in the Policy as:

… the amount of earnings a worker normally receives as remuneration in the occupation(s) in which he or she was employed at the time of injury. Regular earnings are based on the normal payment schedule (daily, weekly, monthly, annually, etc.) converted to a weekly amount ….

Regular earnings do not normally include overtime, special reimbursements for employment expenses or bonuses that are not regularly paid.

Worker's Position

The worker’s position is that his initial benefit rate should have been calculated on the basis of his average earnings calculated as if he had been working at minimum 5 days per week. Although he had only been working for two days at the time of his injury, the worker noted that typically he would work 5-7 days in that position. He stated that this seasonal work would have been available to him for a ten-week period before the usual layoff.

The worker stated that calculating his regular earnings on the basis of two days of work is unfair as that was not his expectation for this seasonal employment.

Employer’s Position

The Employer did not participate in the appeal.

Analysis

The issue before the panel is whether the worker's initial benefit rate for the first 12 weeks has been correctly calculated. In order for the worker's appeal to succeed, the panel must find that the average earnings formula was incorrectly applied or calculated. We are not able to make that finding.

The worker was employed, at the time of the workplace injury, in a seasonal position. As confirmed by the employer, the worker was rehired on September 1, 2015 and his wages from that date to the date of the workplace accident on September 2, 2015 were $300.00.

The employer’s incident report sets out that in the 12-months prior, the worker’s gross earnings were $7,700.00 and that in the last calendar year the worker’s total gross earnings were $3,750.00.

The worker noted that he expected to work 5-7 days each week during the season of employment. The employer stated that the worker was a casual employee, hired on an as needed basis. The worker was not guaranteed hours or days of work each week and only worked when he was needed or when he was available, weather permitting.

In calculating the first payment, the WCB is required by the Policy to apply the average earnings formula on the basis of verifiable information readily available to the WCB. This process is designed to allow for expeditious payment of benefits while providing a reasonable approximation of the worker’s average earning at the time of the accident. This formula will typically be based upon regular earnings at the time of the workplace incident but the Policy also

allows for use of the average yearly earnings amount where the WCB has sufficient documentation and the resultant average earnings would be greater than the regular earnings at the time of the accident.

Based upon the earliest information received from the worker and verified by the employer, the WCB initially determined, on October 14, 2015, that the worker’s average gross weekly earnings were $148.08. This calculation was based upon the information provided by the employer as to the worker’s income in the 12-months prior to the incident, using the average yearly earnings formula as permitted by the Policy.

Subsequently, and based upon additional information received from the employer, the WCB determined on October 20, 2015 that the worker’s average gross weekly earnings were $300.00. This calculation was based upon the worker’s actual earnings during his most recent period of employment, applying the regular earnings definition under the Policy.

The Policy requires that the formula that best represents the worker’s loss of earnings will be chosen. In calculating the first payment amount, the panel notes that the WCB in this situation considered and applied both the regular earnings at the time of the accident and average yearly earnings (based upon a 12-month period prior to the incident).

The October 14, 2015 determination of the benefit based upon the worker’s earnings in the 12-month period prior to the incident (average gross weekly earnings of $148.08) was reconsidered and adjusted upwards on October 20, 2015 when the employer verified the worker’s regular earnings during his most recent period of employment.

The panel acknowledges that the worker anticipated he would work more than two days per week in this position; however, the evidence from the employer is that this was casual employment based upon availability of work and dependent upon weather conditions. While the worker may have worked more than two days per week had this workplace injury not occurred, the evidence on file is that there were no guarantees of additional employment for the worker who was hired as a casual employee.

The regular earnings calculation under the Policy was therefore based upon the amount the worker actually earned in his employment at the time of injury, converted to a weekly amount.

The panel finds that this calculation of the initial benefit rate based on average gross weekly earnings of $300.00 is consistent with the provisions of the Policy and represents a reasonable approximation of the worker’s average earnings at the time of the accident.

In the result, the panel finds that the worker's initial benefit rate for the first 12 weeks has been correctly calculated.

The worker’s appeal is therefore denied.

Panel Members

K. Dyck, Presiding Officer
A. Finkel, Commissioner
P. Walker, Commissioner

Recording Secretary, B. Kosc

K. Dyck - Presiding Officer

Signed at Winnipeg this 26th day of July, 2016