Decision #94/17 - Type: Workers Compensation
Preamble
The worker is appealing the decision made by the Workers Compensation Board ("WCB") regarding the calculation of her average earnings. A file review was held on April 19, 2017 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.
Background
Reasons: On September 14, 2011, the worker injured her left thumb, wrist and shoulder in a work-related accident. The claim for compensation was accepted by the WCB and benefits and services were paid to the worker.
On May 16, 2014, the worker was advised by the WCB that her average earnings had been calculated at $351.75 per week. On May 19, 2015, the worker appealed the decision to Review Office and requested that her average earnings be based on her income from the five years prior to her compensable injury.
On July 7, 2015, Review Office determined that the worker's average earnings had been correctly established at $351.75 weekly.
Review Office noted in its decision that prior to her employment with the accident employer, the worker had worked with one employer for approximately five years in reception/accounts payable. In July 2011, the worker was laid off and received employment insurance (EI) benefits. The worker's plan was to return to school while in receipt of EI benefits. The worker was advised that she could work up to the start date of the course which was January 2012.
Review Office referred to the calculations used by the WCB to calculate the worker's average earnings. It stated that the worker's employment circumstances at the time of her workplace accident were significantly different from her past employment pattern. The worker had made a decision to obtain temporary employment at a lower rate of pay as she was planning to attend school in 2012. The worker would have been seeking employment in accounts payable at the completion of the course. Her earnings from 2009 and 2010 do not accurately reflect the worker's loss of earning capacity as there was a change in circumstances that would have likely affected future earnings.
On January 27, 2017, the worker appealed Review Office's decision to the Appeal Commission and file review was held on April 19, 2017.
Following the file review, the appeal panel requested additional information from the WCB regarding the worker's weekly benefit rate. The response from the WCB dated May 5, 2017 was provided to the worker for comment. On May 26, 2017, the panel met further to discuss the case and rendered its final decision on the issue under
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 Board of Directors.
Under subsection 4(1) of the Act, 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 of the Act deals with the calculation of average earnings. Subsection 45(1) of the Act provides:
Calculation of average earnings 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 worker is appealing the calculation of her average earnings used in setting her wage loss benefits.
Worker's Position
The worker advised of the following on her appeal form:
When going over the review offices decision in regards to my wage I was informed my prior employers wages were not a reflextion (sic) of the future earnings as I was in another field. My wage loss earnings have been projected based on what I would have earned with my accident employer had I not been injured. It states I was hired on a term-basis subject to lay-off.
1. I was hired on a full-time basis. WCB has no way of predicting I would have left [employer] to attend school. Had I decided to stay @ [employer's] my wage would have increased to $16/hr. which is a true reflection of what my wage would have been.
2. WCB based my wage on a lay-off of a retired p/t worker whom does not want to work during the summer. Furthermore he is not doing the same job as I was. There is no way of predicting a summer lay-off for my position.
3. If my wage loss earnings are based on a lay-off that may not even have happened then it is also based on the fact that I would be still working for [employer] at which point my wage would have been $16/hr as of January 2012. So either way I feel my wage was calculated wrong…
I request a further review of my wages to make a more realistic decision. WCB has deemed me unemployable due to the extent of my injuries. I did not ask to be injured nor do I feel I should be penalized in regards to my wage based on an unfair assessment of my future earnings.
Employer's Position
The employer provided a letter to the WCB on January 18, 2017 indicating:
[Worker] was hired on a full-time basis. Had she decided to stay at [employer's] rather than go to school her wages would have been $16/hour. There is no way to predict a layoff for [worker] as it would be based on the (sic) busy the company was and the financial position each year.
Analysis
The issue before the panel is whether the worker's average earnings have been correctly calculated. For the worker's appeal to be successful, the panel must find that the calculation is not correct. The panel was not able to make this finding.
As noted previously, under the Average Earnings Policy, the WCB is to use the formula that best reflects the worker's actual loss of earnings.
The worker asked that her wage loss be based upon her earnings in 2009 and 2010. File information indicates that during this period she was employed in a reception/accounts payable positon. She was laid off from this positon by her employer in July 2011. She then collected employment insurance benefits (EI).
The panel notes that the worker had been laid off from her long term position, was only working temporarily and planned to participate in a training program. The worker was not returning to the work she did in 2009 and 2010. The panel therefore finds the worker's prior earnings in 2009 and 2010 do not represent her earning capacity at the time of the accident and that file information confirms she was not earning this amount at the time of the accident.
The panel finds that the calculation that best represents her actual loss of earning capacity is the probable yearly earning capacity based on her employment with the accident employer. The calculation of probable yearly earning capcity is:
Actual earnings Sept 12, 2011 to Sept 14, 2011 - $174.20 Probable earnings to May 25, 2012 - $15,142.40 EI waiting period May 26, 2012 to June 8, 2012 - $0.00 Probable EI earnings June 9, 2012 to Sept 9, 2012 - 13 weeks ($416.00 x 55%) = $2974.40 Total Projection Sept 12, 2011 to Sept 11, 2012 - $18,291 divide by 52 weeks = $351.75
The panel notes that the employer initially projected that the worker would be employed until the end of April 2012. The employer later advised that the replacement worker was employed until May 25, 2012. The panel finds this to be a reasonable proxy for calculating when the worker would have worked for the employer.
The panel notes the letter provided by the employer in January 2017 suggesting a $16/hr wage but finds that it is too remote from the accident date to use as a reliable indication of the worker's earnings capacity. As well, the Policy does not provide for use of an income number provided almost 6 years after the accident. With regards to the assertion that the worker was hired on a full-time basis, the panel notes that this is inconsistent with the worker's evidence provided at the time of the accident, that she was working in a temporary position with the intention of returning to school.
The worker's appeal is dismissed.
Panel Members
A. Scramstad, Presiding Officer
A. Finkel, Commissioner
M. Kernaghan, Commissioner
Recording Secretary, B. Kosc
A. Scramstad - Presiding Officer
(on behalf of the panel)
Signed at Winnipeg this 23rd day of June, 2017