The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The worker is appealing the decision made by the Workers Compensation Board ("WCB") that:

Date of Accident - February 8, 2013:

1. They were not entitled to partial wage loss after July 18, 2013; and 

2. Their average earnings have been correctly calculated.

Date of Accident - May 30, 2014:

1. Their average earnings have been correctly calculated.

A hearing was held on November 21, 2023 to consider the worker's appeal.

Issue

Date of Accident - February 8, 2013:

1. Whether or not the worker is entitled to partial wage loss after July 18, 2013; and 

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

Date of Accident - May 30, 2014:

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

Decision

Date of Accident - February 8, 2013:

1. The worker is entitled to partial wage loss after July 18, 2013; and 

2. The worker's average earnings have not been correctly calculated.

Date of Accident - May 30, 2014:

1. The worker's average earnings have been correctly calculated.

Background

Date of Accident – February 8, 2013

On February 13, 2013, the WCB received the worker’s claim for bilateral shoulder tendonitis arising out of the repetitive nature of their overhead job duties. The worker noted they experienced symptoms before February 8, 2013 but first sought medical attention on that date. In the Doctor First Report for the worker’s appointment on February 8, 2013, the treating physician diagnosed shoulder pain and recommended physiotherapy. X-rays of the worker’s shoulder taken on February 21, 2013 indicated “No significant bony, soft tissue, or joint abnormality” in either shoulder. The worker saw another physician at a walk-in clinic on February 28, 2013, and that physician outlined workplace restrictions of no heavy lifting, no overhead work, and no exposure to cold. The employer provided a description of the worker’s job duties to the WCB on March 7, 2013 and on March 13, 2013, the WCB accepted the worker’s claim and provided partial wage loss benefits for the worker’s missed time to attend physiotherapy treatments.

The worker attended a call-in examination with a WCB medical advisor on July 18, 2013. The medical advisor concluded the worker’s current diagnosis was bilateral non-specific shoulder pain, with a normal recovery period of several weeks to several months and noted that the worker's recovery was "…considered slow to date"; however, the worker's ongoing complaints of severe bilateral shoulder difficulties were not accounted for in relation to the compensable accident, as the worker was provided with accommodated duties since that date. The medical advisor recommended further physiotherapy, and on August 12, 2013, the WCB referred the worker to physiotherapy for conditioning treatment. The treating physician cleared the worker to return to regular duties on October 15, 2013.

On November 13, 2013, the WCB provided a letter to the worker advising them that it determined they recovered from the February 8, 2013 workplace accident and they were not entitled to further benefits after November 21, 2013.

On November 14, 2013, the WCB met with the worker to discuss the claim and provide a copy of the decision letter. At that time, the worker noted their belief that their wage loss benefits were not correctly calculated as their overtime earnings were not considered. The WCB requested further wage information from the employer on January 21, 2014, and a WCB payment assessor provided a final calculation of the worker’s average earnings. On April 14, 2014, the WCB wrote to the worker advising that their average earnings were recalculated and providing a lump sum payment for the amount owing to the worker, noting the payment covered the period from April 9, 2013 through August 7, 2013.

Date of Accident - May 30, 2014

On June 2, 2014, the worker reported to the WCB that on May 30, 2014, while walking through the employer's parking lot on their way home after their shift, they tripped on a curb and injured their right ankle. In discussion with the WCB on June 2, 2014, the worker confirmed that afterward, they were taken to a local hospital by their spouse, where x-rays indicated a broken right ankle, which was placed in a cast. The WCB accepted the worker's claim for a right ankle fracture and initiated payment of benefits on June 12, 2014.

The worker's recovery from this compensable injury was delayed by the worker’s non-compensable health concerns. On January 7, 2015, the WCB advised the worker that based on a WCB medical advisor’s review of their claim, the WCB determined the worker was recovered from the right ankle injury.

On March 2, 2015, the worker questioned the calculation of their average earnings, noting that their WCB wage loss benefits from the previous year as well as lost overtime earnings were not considered in calculating the average earnings. The WCB gathered additional information from the worker, their union representative, and the employer. On March 19, 2015, a WCB payment assessor outlined in a memorandum to the worker's file how the average earnings were calculated, noting that the WCB wage loss benefits paid to the worker in the previous year were not considered as earnings, and that the employer had indicated due to the change in the worker's position, less overtime was available. As such, the average earnings calculated on the worker's file would remain as previously calculated. The WCB sent a decision letter to the worker on March 25, 2015, setting out their calculations.

Both Claims

On November 17, 2015, the worker's representative requested Review Office reconsider the WCB's decisions on the worker's entitlement to partial wage loss benefits on the 2013 claim and the worker's average earnings on the 2014 claim. The representative noted the worker required ongoing treatment for their compensable injury, including reconditioning that the WCB arranged for the worker, which supported a finding that the worker was not recovered from the workplace accident and required further partial wage loss benefits to attend that treatment. On November 18, 2015, Review Office advised the worker and the employer that the review of the worker's claim would be expanded to also include whether the worker's average earnings were calculated correctly on the 2013 claim. The employer's representative provided a submission in support of the WCB's decisions on January 11, 2016, shared with the worker, and the worker’s representative provided a further response on January 18, 2016.

On January 25, 2016, Review Office determined the worker was entitled to partial wage loss benefits from April 1, 2013 to July 18, 2013, and that their average earnings were not correctly calculated on both the 2013 and 2014 WCB claims. On the question of entitlement to partial wage loss, Review Office found the worker's actual period of disability began on April 1, 2013, based on the worker no longer working overtime due to their increased shoulder symptoms. Further, Review Office accepted the WCB medical advisor’s call-in examination opinion that the worker was recovered from the compensable injury and therefore was entitled to partial wage loss benefits from April 1, 2013 to July 18, 2013. Review Office also found that the calculation of the worker’s 2013 average earnings was not correct, noting that the worker's income in the year prior to the February 8, 2013 workplace accident was higher than previous years due to the cyclical nature of the employer's business, which resulted in the worker having lots of overtime hours. Review Office found that a historical calculation of the worker's earnings from 2009 through March 31, 2013 would better represent the worker's average earnings. Review Office returned the worker's file to the WCB's Compensation Services for further adjudication of the 2013 earnings. With respect to the 2014 accident claim, Review Office found that the change in the worker's average earnings between 2013 and 2014 was due to a non-compensable cause, and concluded the average earnings were correctly calculated.

The worker's representative filed an appeal with the Appeal Commission on May 29, 2023 and a hearing was arranged.

Reasons

Applicable Legislation and Policy

The Appeal Commission and its panels are bound by the provisions of The Workers Compensation Act (the "Act"), regulations under that Act and the policies established by the WCB's Board of Directors. The provisions of the Act in effect as of the date of the worker’s accident are applicable. 

A worker is entitled to benefits under s 4(1) of the Act when it is established that a worker has been injured as a result of an accident at work. Under s 4(2), a worker who is injured in an accident is entitled to wage loss benefits for the loss of earning capacity resulting from the accident, but no wage loss benefits are payable where the injury does not result in a loss of earning capacity during any period after the day on which the accident happens. When the WCB determines that a worker has sustained a loss of earning capacity, an impairment or requires medical aid as a result of an accident, compensation is payable under s 37 of the Act. Section 39(2) of the Act sets out that wage loss benefits are payable until the worker's loss of earning capacity ends or the worker attains the age of 65 years.

The Act outlines the method of calculation of a worker’s average pre-accident earnings in s 45, as follows:

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. 

Average earnings includes all employment income 

45(2) In making a calculation under subsection (1), the board shall consider any employment income the worker has at the time of the accident from which the worker sustains a loss of earnings, whether or not the employment is in an industry to which this Part applies. 

Adjustment of earning capacity 

45(3) Where the board is satisfied that a worker's average earnings before the accident do not fairly represent his or her earning capacity because the worker was an apprentice in a trade or occupation, the board may adjust wage loss benefits from time to time by deeming the worker's average earnings to be an amount that, in its opinion, reflects the probable earning capacity of the worker in the trade or occupation.

WCB Policy 44.80.10.10, Average Earnings (the “Policy”) outlines how the WCB will determine a worker’s average earnings at the time of a compensable injury. The Policy sets out that the formula used is the one that “best represents the worker’s employment and earnings pattern before the accident.”

The regular earnings formula calculates the worker’s average earnings based on the amount of earnings they would normally receive as remuneration in all occupation(s) in which they were employed on the date of accident, if their ability to earn income from each of these occupations was affected by the compensable injury. This formula normally excludes overtime, special reimbursements, allowances, and bonuses.

The average yearly earnings formula is used when a worker has an irregular earnings pattern due to the nature of their work, for example, as a seasonal worker, contract worker, pieceworker, or with fluctuating overtime. Average yearly earnings include any verifiable remuneration that the worker received from employment and employment insurance benefits, and includes overtime, special reimbursements, allowances and/or bonuses. Under this formula, the WCB will generally rely on data from any consecutive 12-month period occurring during the one or two years before the date of the accident but may choose one or more consecutive 12-month periods from any of the previous five calendar years if doing so would produce a more accurate reflection of the worker’s employment and earnings pattern before the accident.

The probable yearly earning capacity formula forecasts what a worker might be expected to earn for a consecutive 12-month period after the day of accident. Although based on the worker’s earnings before the accident, this formula uses the worker’s regular earnings or average yearly earnings and adjusts them to reflect the worker’s probable employment and earnings pattern going forward, or alternatively, the employment and earnings pattern of a representative sample of similarly employed workers. It also may include presumed employment insurance benefits. This formula is used when the formulas for regular earnings and average yearly earnings do not accurately reflect what the worker’s average earnings likely would have been, but for the accident, and generally, the WCB will only use probable future earning capacity to calculate average earnings when there is a sufficient degree of certainty about what the worker’s average earnings likely would have been.

Worker’s Position

The worker appeared in the hearing represented by a worker advisor. The worker’s representative made an oral submission in the hearing and relied upon the written submission provided to the Appeal Commission in advance of the hearing. The worker provided testimony through answers to questions from their representative and from members of the appeal panel.

The worker’s position with respect to their entitlement to partial wage loss benefits beyond July 18, 2013 is that their bilateral shoulder difficulties at that time related to both the compensable workplace injury sustained on February 8, 2013 and the worker’s pre-existing shoulder condition and required continuing workplace restrictions and medical treatment beyond that date. The worker’s representative noted that the WCB continued to fund the worker’s physiotherapy and medication well beyond July 18, 2013, as supported by the WCB medical advisor’s comments following the call-in examination of that date. Further, the worker’s representative noted the findings of the medical advisor which Review Office relied upon were not finalized until at least July 26, 2013, and submitted it would be unjust to terminate the worker’s wage loss entitlement based on those findings effective as of a date before the report was even completed. For all these reasons, the worker should be entitled to continuing partial wage loss benefits after July 18, 2013.

With respect to the calculation of the worker’s average earnings in the 2013 accident claim, the worker’s position is that the WCB did not correctly determine those earnings. The worker agreed that the average yearly earnings formula should be used but submitted that it was not appropriate to calculate the earnings based on the average earnings from 2009 through 2012 as the worker’s income increased steadily over that time and their year-to-date of accident earnings for 2013 suggested that the worker’s income in that year would have been consistent with their 2012 earnings. The worker’s position is that the worker's 2012 calendar year earnings would most accurately reflect the worker's earning capacity for 2013 and as such, the average earnings should be calculated based on that specific 12-month period.

On the calculation of the worker’s average earnings in the 2014 accident claim, the worker’s position is that the WCB also did not correctly determine those earnings in relying upon the regular earnings formula. Rather, the worker’s representative submitted that the most accurate reflection of the worker’s earning capacity for 2014 would rely on the average yearly earnings formula, based on the worker’s 2013 calendar year earnings, or else their earnings from the 12-month period immediately prior to the date of accident, and in each case should discount the period when the worker was receiving WCB wage loss benefits in relation to the 2013 accident claim.

Employer’s Position

The employer was represented in the hearing by its disability management specialist who made an oral submission in support of the employer’s position and provided additional information in response to questions posed by the members of the appeal panel.

The employer’s position, as outlined by their representative, is that the decision of Review Office should be upheld. The employer submits that the evidence supports a finding that the worker is not entitled to wage loss benefits after July 18, 2013 in relation to the 2013 claim. The employer further submits that the evidence supports the use of the average income from 2009 to the date of accident, in calculating the worker’s average earnings in relation to the 2013 accident claim, and that the regular earnings formula should be used in relation to the 2014 accident claim.

The representative stated that overtime availability is not constant in the employer’s workplace from year to year, based on demand for the employer’s products. The representative noted that overtime hours increased from 2013 to 2014 and then decreased in 2014. The representative also explained to the panel that the employer provides bonuses to workers on an equal distribution basis, not based on individual performance or hours worked. As such, the worker’s entitlement to any bonus would not be impacted by their injury or status as an accommodated worker.

The representative confirmed that the worker’s regular hours are based on an 8-hour shift, and that the 12-hour shifts worked in 2013 were comprised of 8 regular hours and 4 overtime hours.

The representative submitted that the worker’s fluctuating income due to variability in overtime hours is the reason why the panel should rely on the average yearly earnings formula in determining the worker’s average earnings, noting there is substantial variation in the worker’s income in the period from 2009 to 2013. The representative also noted that the worker’s promotion to a supervisory position with a resulting boost in their hourly wage is not an indefinite or guaranteed position but can be rotated to other workers at the employer’s choice.

Analysis

In this appeal, there are several questions for the panel to determine. Firstly, is the worker entitled to partial wage loss after July 18, 2013? Secondly, are the worker’s average earnings correctly calculated in relation to the 2013 accident claim? Finally, are the worker’s average earnings correctly calculated in relation to the 2014 accident claim? The panel considered each question in turn, as detailed in the reasons that follow, and determined the worker is entitled to partial wage loss after July 18, 2013, that their average earnings are not correctly calculated in relation to the 2013 claim, and that the worker’s average earnings are correctly calculated in relation to the 2014 claim. As such, the worker’s appeal is granted in part.

Entitlement to Partial Wage Loss after July 18, 2013 

For the panel to find that the worker is entitled to partial wage loss benefits after July 18, 2013, we would have to determine that the worker sustained a loss of earning capacity beyond that date that related to the compensable injury sustained on February 8, 2013. As detailed below, we were able to make such a finding and therefore the worker’s appeal on this question is granted.

In considering the worker’s entitlement to partial wage loss benefits beyond July 2013, the panel reviewed and considered the medical reporting in relation to the worker’s treatment and recovery from that injury. On July 10, 2013, the treating physician indicated the need for ongoing workplace restrictions in relation to work over shoulder height, reaching and use of vibratory hand tools, noting there was some improvement in the worker’s left shoulder with the right more limited in terms of mobility. The physician further noted that the medications helped the worker’s symptoms, but the worker discontinued physiotherapy in mid-May because it “aggravates pain.” In a further report on July 25, 2013, the physician again noted improvement in the worker’s left shoulder range of motion and pain, but continuing limitation in the worker’s right shoulder abduction and internal rotation. On August 8, 2013, the treating physician again supported continuing restrictions, noting the worker’s right shoulder was still not improving and that the worker was to resume physiotherapy. The evidence in this claim confirms that the treating physician continued to support restrictions in relation to the worker’s bilateral shoulder injury until October 15, 2013.

The panel noted that the evidence also indicates the worker had pre-existing osteoarthritis in both shoulders, which the worker’s representative acknowledged had a combined effect with the workplace injury, that more likely than not prolonged the worker’s recovery from the compensable injury. The panel also noted the evidence that the pre-existing shoulder condition continued to impact the worker’s functional abilities beyond the date of their return to work in October 2013, without compensable restrictions.

The panel also considered the evidence from the call-in examination of July 18, 2013. Those findings confirm that the worker’s right shoulder range of motion was reduced, as compared to the left shoulder. The medical advisor concluded the current diagnosis was “nonspecific shoulder pain” which they noted would typically resolve with gradual mobilization to full activity. We noted the medical advisor also found the worker was not at that time capable of a return to their full pre-accident job duties, and confirmed a need for further treatment, including a course of physiotherapy to condition the worker in preparation for a return to regular duties, which would begin after the July 18, 2013 examination. We further noted that the WCB accepted the medical advisor’s recommendation and approved a course of 8 additional physiotherapy treatments, as well as funding additional medications in relation to the worker’s compensable injury. Further, the evidence also indicates that to attend that treatment, the worker incurred time loss from work.

The evidence before the panel supports a finding that the worker continued to sustain a loss of earning capacity beyond July 18, 2013 in relation to the compensable workplace injury of February 8, 2013.More specifically, there is evidence that the worker required additional medical treatment and incurred time loss in obtaining that treatment. The worker's representative submitted that the panel should find the worker is entitled to partial wage loss benefits until their treating physician authorized the worker to return to work without restrictions on October 15, 2013; however, the panel is unable to make such a finding in the absence of initial adjudication of the duration of those benefits. Our decision is therefore a point in time decision.

Based on the evidence before us, and on the standard of a balance of probabilities, the panel is satisfied that the worker is entitled to partial wage loss after July 18, 2013. The worker’s appeal on this question is granted.

Average Earnings in 2013 Claim 

In establishing a worker’s wage loss benefit rate, the Act requires that the WCB calculate the worker’s average earnings before the accident, from employment and employment insurance benefits. As noted above, the Policy sets out three possible methods that the WCB will use in determining a worker's average earnings. The first relies on the worker’s actual earnings from all work impacted by their injury as of the date of accident. The second is based on the worker’s historical earnings, averaged, over any 12 month period in the 1, 2 or up to 5 years prior to the date of the accident. The third formula projects what the worker’s income would have been in the 12 months after the accident, based on their earnings at the time of the accident, and adjusted.

The Policy outlines that the formula to be used is the one that “best represents the worker’s employment and earnings pattern before the accident.” The regular earnings formula is used when the worker has regular employment income that does not fluctuate over the course of a year, but when a worker’s income is more irregular, whether due to season fluctuations, contract or piece work, or variable overtime, the average yearly earnings formula may be used to produce “a more accurate reflection of the worker’s employment and earnings pattern before the accident.” To use the average yearly earnings formula, the Policy sets out that the WCB will generally consider “any consecutive 12-month period occurring during the one or two years before the date of the accident” and that in appropriate circumstances, it “may choose one or more consecutive 12-month periods from any of the previous five calendar years”. The probable earnings formula is used when the regular earnings and average yearly earnings formulae do not accurately reflect what the worker’s average earnings would likely have been but for the accident, based on circumstances such as a change in the worker’s employment status or circumstances.

In considering whether the worker’s average earnings were correctly calculated, the panel considered the evidence that the worker’s pre-accident income included their regular wages plus bonus and overtime. We noted the evidence that the worker's wage income increased after 2011 when they received a promotion, and although the employer confirmed that change in role was not guaranteed indefinitely, the worker confirmed that they continued in that position at the time of the workplace accident and even after their return to work, post-accident. The panel also considered the worker’s expectation of a continuation of the regularized overtime hours that they worked through 2012 and into 2013 until the date of their injury. We further noted the pattern of increasing income over the period from 2009 to the date of accident. In these circumstances, the panel is satisfied that it would not be appropriate to rely upon the regular earnings formula which assumes no variation or fluctuation in income over time. We find that the evidence does not support the use of that approach, but rather, that the average yearly earnings formula is more likely to accurately reflect the worker’s earnings pattern, as the evidence here demonstrates fluctuation in the worker’s earning history leading up to the accident.

Having determined that the average yearly earnings formula is the one that best reflects the worker’s earnings at the time of the accident, the panel then considered whether it was appropriate to rely on any consecutive 12-month period during the one or two years before the accident, or if it should choose one or more consecutive 12-month periods from the previous five calendar years, as permitted by the Policy. We noted that the upward trend in the worker’s income in the years leading up to the 2013 accident, and that the worker’s income included significant overtime hours in 2012 and in 2013, leading up to the date of accident. In these circumstances, the panel is satisfied that the 12-month period immediately prior to the date of accident on February 8, 2013, would most accurately reflect the worker’s employment and earnings pattern before the accident, as required by the Policy. Based on the evidence before us, and on the standard of a balance of probabilities, the panel is satisfied that the worker’s average earnings in relation to the 2013 accident claim have not been correctly calculated. We therefore return this claim to the WCB for determination of the worker’s average earnings on the basis indicated. The worker’s appeal on this question is granted.

Average Earnings in 2014 Claim 

The panel applied the same policy considerations in determining which formula would best reflect the worker's employment and earnings pattern before the May 30, 2014 accident.

The WCB found that the appropriate formula that best reflected the worker’s employment and earnings pattern at the time of the 2014 accident was the regular earnings formula, which considered the worker’s wages at the time of the accident. The employer’s position is that this was appropriate, but the worker submitted that the panel should rather find that the average yearly earnings formula would best reflect the worker’s employment and earnings pattern as of May 2014. The worker’s representative argued that the same formula should be used in respect of both claims.

The panel noted each claim arose in different circumstances, each caused a different injury to the worker, and in a different employment and economic environment. The specific circumstances of each claim must be reviewed and considered in determining which approach should be taken for each claim. We do not agree with the worker’s submission that the same approach should necessarily be taken in respect of both claims.

The panel considered that in May 2014, the worker was working at regular hours, with a continuing non-compensable accommodation in place. There is evidence that there was no longer an expectation of ongoing overtime as standard practice in 2014, as was the case in 2013. The employer’s evidence indicated that because of a change in the demand for the goods produced by the employer, the worker would not have been able to regularly work overtime in 2014, neither before nor after the accident. While the worker indicated that this was the result of their continuing non-compensable workplace restrictions, the panel accepts the employer’s evidence that the lack of overtime opportunities was rather due to market conditions. The panel also considered that for a significant period in the year immediately prior to this accident, the worker was in receipt of wage loss benefits and working with restrictions because of the 2013 workplace accident, which period the worker’s representative argued the panel should exclude in applying the average yearly earnings formula. The evidence confirms that the worker’s employment pattern in the approximately 18 months before the accident was not consistent with their previous employment pattern. Furthermore, the evidence confirms that the worker’s bonus entitlement was not impacted by their workplace restrictions or accommodations.

As such, the panel finds that the earnings in the 12 month period immediately prior to the accident, or the earnings in the 2013 calendar year, or the income in any one or more consecutive 12-month periods in the 5 years prior to the accident, would not most accurately reflect the worker’s employment and earnings pattern before May 30, 2014. Based on the evidence before us, and on the standard of a balance of probabilities, the panel is satisfied that the regular earnings formula best and most accurately reflects the worker's pre-accident earning and employment pattern in 2014. Therefore, the worker’s average earnings have been correctly calculated in relation to the 2014 accident claim, and the worker’s appeal on this question is denied.

Panel Members

K. Dyck, Presiding Officer
J. Peterson, Commissioner
M. Kernaghan, Commissioner

Recording Secretary, J. Lee
K. Dyck

K. Dyck - Presiding Officer
(on behalf of the panel)

Signed at Winnipeg this 15th day of December, 2023