The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The employer is appealing the decision made by the Workers Compensation Board ("WCB") that it is not entitled to cost relief. A file review was held on April 6, 2017 to consider the employer's appeal.

Issue

Whether or not the employer is entitled to cost relief.

Decision

That the employer is not entitled to cost relief.

Background

The worker filed a claim with the WCB for a left shoulder strain that he related to his work activities on January 31, 2016 when he lifted a case of two litre bottles. On February 5, 2016, the worker attended a physician and was diagnosed with a left rotator cuff strain. The worker did not miss any time from work and modified duties were offered by his employer. The worker commenced physiotherapy treatment which was accepted by the WCB.

On March 11, 2016, the worker attempted to return to his full regular work duties. On March 16, 2016, the worker advised the WCB that he was unable to perform his full duties after moving/lifting product for about one hour. The worker confirmed that he ended his employment as he wanted to find something that was less labour intensive, with full-time hours. The adjudicator advised the worker that his physiotherapy treatments would still be covered by the WCB. On August 30, 2016, the treating physiotherapist reported that the worker was discharged from treatment on May 2, 2016.

On September 1, 2016, the employer's representative requested 100% cost relief. The employer's position was that the worker's accident of January 31, 2016 was very minor; that the accident did not cause the impairment and the need for a five month treatment duration and recovery. If the WCB was unable to grant cost relief, the employer requested removal of all claim costs. On October 6, 2016, Compensation Services denied cost relief to the employer as there was no pre-existing condition that delayed the worker's duration of recovery. On October 13, 2016, the employer appealed the decision to Review Office.

On January 13, 2017, Review Office determined there was no entitlement to cost relief. Review Office stated:

…the circumstances of this claim do not meet the criteria for 100% cost relief. There is no evidence on file that a pre-existing condition was the primary cause of the accident and the claim does not involve the wearing of an artificial appliance.

We also find the criteria for 50% cost relief has not been met as there is no evidence on file of a pre-existing condition and the worker's time loss was not greater than 12 weeks…

We do not find that there are any unusual or extraordinary circumstances that would warrant the removal of any claim costs from the employer's cost experience.

The length of time it took for the worker to complete the authorized course of physiotherapy did not result in an increase in the claim costs.

The Review Office determines the circumstances of this claim do not meet the criteria of any of the six situations provided by the Policy. There is no entitlement to cost relief.

In February 2017, the employer's representative appealed Review Office's decision to the Appeal Commission and a file review was arranged.

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 WCB's Board of Directors.

WCB Policy 31.05.10, Cost Relief/Cost Transfers (the "Policy") outlines circumstances in which claim costs may be removed from the cost experience of an accident employer and charged to a collective cost pool. This process is called "cost relief."

The situations in which cost relief is available to eligible employers are set out in section A.1.a) of the Policy, and include:

(i) When the claim is either caused by a pre-existing condition or is significantly prolonged by the pre-existing condition. The cost relief criteria and method of cost allocation are described in Schedule A.

…

(v) When the claim costs unfairly burdens an employer, the WCB may exclude all or part of these costs from a Class E employer's cost experience. The cost relief criteria and method of cost allocation are described in Schedule H.

Schedule A of the Policy, "Pre-existing Conditions" states, in part, as follows:

100% Relief

The following pre-existing conditions will result in immediate 100% cost relief to the employer:

• When the prior condition is determined to be the primary cause of the accident.

• When the wearing of an artificial appliance is determined to be the primary cause of the accident.

50% Relief

For other claims involving a pre-existing condition, 50% cost relief may be provided. When a claim is significantly prolonged by a pre-existing condition, cost relief for 50% of the claim costs will be provided to the employer if the worker's time loss is greater than 12 weeks.

Schedule H of the Policy, "Unfair Burden" states, in part:

Under subsection 82(4)(d) of the Act, the WCB may exclude from a Class E employer's cost experience that portion of the claim costs that in its opinion would unfairly burden a particular employer.

An "unfair burden" is generally understood to mean having a substantial financial impact. Recognizing that the rate-setting model imposes financial limits on employer's assessment rates, there must be other compelling reasons or unusual or extraordinary situations an employer is facing…A burden is regarded as unfair when it imposes disadvantages other employers would not face in similar circumstances or when the impact is clearly unwarranted for the situation at hand.

Employer's Position

The employer was represented by a consultant who provided a written submission for the panel's consideration.

The employer's position was that they should be awarded up to 100% cost relief. It was submitted that the incident in question was very minor. It was anticipated at the outset that the worker would recover in three weeks, yet the WCB allowed treatment to continue for five months, at a cost of $1,500.00. This was excessive for such a minor injury. The WCB had not supplied medical to support that impairment was only related to the accident. In the employer's view, their claims costs should not be negatively prejudiced because the WCB was overly generous in terms of the time frame and costs it allowed for treatment.

Worker's Position

The worker did not participate in the appeal.

Analysis

The issue before the panel is whether or not the employer is entitled to cost relief. For the employer's appeal to be successful, the panel must find that the facts and circumstances of this case meet the requirements of the Policy. The panel is unable to make that finding.

The Policy specifies six situations in which cost relief may be granted. The applicable criteria are described in the schedules which form an integral part of the Policy. Based on our review of the file, the panel finds that none of the criteria for cost relief have been met in the circumstances of this case.

In particular, the panel is unable to find that cost relief is available due to the effect of a pre-existing condition. The panel finds that no pre-existing condition has been identified, and there is no basis for suggesting that any such condition was the primary cause of, or significantly prolonged, the claim. The criteria for 100% and 50% cost relief due to a pre-existing condition, as set out in section A.1.a)(i) and Schedule A of the Policy, have therefore not been satisfied. The panel is also unable to find that the claim costs or any portion of the claim costs have unfairly burdened the employer as contemplated under section A.1.a)(v) and Schedule H of the Policy. The panel finds there is no indication that the claim costs had a substantial financial impact on the employer, that the employer was particularly disadvantaged as compared to what other employers would face in similar circumstances, or that the impact on the employer was clearly unwarranted for the situation at hand.

The panel would further note that physiotherapy was recommended and treatment was authorized on February 12, 2016, for up to 20 visits. Information on file indicates that the worker was discharged from treatment on May 2, 2016, or slightly more than three months after the date of incident. The evidence therefore shows that the treatment which the worker received and the cost of that treatment were consistent with, and did not exceed, what was authorized on February 12, 2016.

The panel recognizes that the employer may feel frustrated by the claim and the duration of the claim. The Policy is specific, however, as to the situations in which cost relief may be available. In our view, the employer's request for relief cannot be granted based on the reasons they have put forward.

Based on the foregoing, the panel finds that the facts and circumstances of this case do not meet the requirements of the Policy. The employer is therefore not entitled to cost relief.

The employer's appeal is denied.

Panel Members

M. L. Harrison, Presiding Officer
A. Finkel, Commissioner
M. Kernaghan, Commissioner

Recording Secretary, B. Kosc

M. L. Harrison - Presiding Officer
(on behalf of the panel)

Signed at Winnipeg this 31st day of May, 2017