The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The worker appealed the Workers Compensation Board ("WCB") decisions that they are not entitled to wage loss benefits after June 22, 2020 and that their average earnings have been correctly calculated. A videoconference hearing took place on June 17, 2025 to consider the worker's appeal.

Issue

1. Whether or not the worker is entitled to wage loss benefits after June 22, 2020; and 

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

Decision

1. The worker is not entitled to wage loss benefits after June 22, 2020; and 

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

Background

The WCB received an Employer’s Accident Report on December 10, 2020 indicating the worker sustained a psychological injury after an incident at work on January 20, 2018. The employer noted the worker reported on November 24, 2020 that they developed Post Traumatic Stress Disorder (“PTSD”) as a result of being robbed at gunpoint while at work on January 20, 2018, with the diagnosis made in June 2020.

When the WCB contacted the worker on January 7, 2021, the worker advised they contacted the WCB in 2018 but was advised the employer did not have WCB coverage as their workers were considered self-employed. The worker noted they also submitted a claim through a provincial program compensating victims of crime and received some benefits through that program. The worker advised they did not see a psychiatrist until approximately one year after the incident but sought treatment from their family physician during that time. The worker also advised they had not worked since the incident and were no longer employed with the same employer. The WCB confirmed that the employer was required to have WCB coverage for their workers and had coverage in place at the time of the January 20, 2018 workplace accident.

In further discussion with the WCB, the worker provided details of the January 20, 2018 incident and confirmed a police report was filed. The worker confirmed they reported the January 20, 2018 incident to their manager after it occurred and requested their shifts be cancelled for the balance of that week. The worker indicated they did not provide any availability to the employer for the following four weeks but then began to pick up a few shifts, although they struggled, felt fearful and uncomfortable, and then advised the employer they were not ready to return to work. The worker stated they advised their family physician of the incident but did not provide details and noted they were already taking medication for a previously diagnosed mental health condition. The worker stated that after the incident, they began to experience headaches and depression. In January 2020, the worker started treatment with a psychologist and as part of their treatment, returned to work in June 2020. The worker noted the attempt to return to work was unsuccessful due to an increase in symptoms and that their current symptoms included anxiety when thinking of being around people and depression but noted their interest in returning to work. The WCB advised the worker that further investigation was required.

The WCB received chart notes from the treating family physician and reports from the treating psychologists, as well as information from the employer and a copy of the police report regarding the incident. A WCB psychiatric consultant reviewed the worker’s claim on April 13, 2021 and noted the PTSD diagnosis provided on initial assessment by the treating psychologist in January 2020. The WCB consultant noted the worker currently experienced some fear, reactivity and avoidance but no longer met the criteria for a diagnosis of PTSD and concluded that the worker sustained a psychological injury, PTSD, as a result of the January 20, 2018 workplace accident. The WCB psychological consultant noted the February 8, 2021 report from the treating psychologist indicated the worker was capable of working in June 2020 and that the worker had a pre-existing psychological condition. After reviewing additional information on May 18, 2021, the WCB psychological consultant confirmed their opinion.

On June 24, 2021, the WCB advised the worker that the claim was acceptable, and they were entitled to wage loss benefits from January 20, 2018 up to and including June 22, 2020, the date that a psychiatric assessment took place which indicated the diagnostic criteria for PTSD were no longer met. On June 30, 2021, a WCB payment assessor calculated the worker’s average earnings and the WCB paid partial wage loss benefits. The worker provided paystubs to the WCB on July 7, 2021 and a further average earnings review was conducted, resulting in payment of an adjustment to the worker.

The worker requested Review Office reconsider the WCB’s decision that they were not entitled to wage loss benefits after June 22, 2020 as they continued to experience symptoms of PTSD. The worker provided information indicating they received a settlement from the employer which they believed should be included in calculating their wage loss benefits. Review Office returned the worker’s file to Compensation Services for further investigation. The WCB also received additional medical information from the treating healthcare providers and requested that a WCB psychological consultant review the file. On February 17, 2023, the consultant noted the medical information on file was insufficient to answer the questions posed by the WCB and as such, a call-in examination should take place. The worker advised the WCB on February 27, 2023 that they also had other self-employment income that was not considered when the WCB calculated their wage loss benefits. On the same date, the WCB advised the worker they would need to submit tax documentation to show income information for the self-employment income.

The WCB’s psychological consultant placed a memorandum to the worker’s file on March 7, 2023 noting “numerous obstacles” to in-person call-in examination at the WCB and requesting an independent medical examination take place in the location that the worker moved to.

On July 25, 2023, the worker provided financial information, including business income and expense statements to the WCB and requested a recalculation of their average earnings. The WCB advised the worker on July 28, 2023 that it required income tax returns in order to review the payment calculations. After the worker again submitted business statements for 2017 to the WCB on August 23, 2023, the WCB provided the worker with a release authorization form to permit the WCB to request the required information directly from the Canada Revenue Agency (CRA); however, the worker declined to sign the authorization. On August 24, 2023, the WCB advised the worker of the need to obtain tax information directly from CRA in order to review their entitlement to further wage loss benefits, and on the same date, the worker again advised they would not authorize the release of information from the CRA.

On September 11, 2023, the worker requested Review Office reconsider the WCB’s decision regarding their average earnings, noting their belief the business statements provided were sufficient and that the WCB did not require the information directly from the CRA in order to review the average earnings calculation. Review Office determined on November 24, 2023, the worker’s average earnings were correctly calculated.

The WCB arranged an out-of-province non-treating psychological examination to take place on March 4, 2024. On January 8, 2024, the WCB provided a consent form to the worker and a Questionnaire from the examining psychologist. In discussion with the WCB on February 22, 2024, the worker advised they would not authorize release of their medical information to the examining psychologist but would provide the psychologist with their medical information directly.

On February 21, 2024, the worker confirmed to the WCB that before the accident, they were self-employed and that they briefly returned to work between June 2020 and October 2020, didn’t work between October 2020 and November 2021, returned to work between November 2021 and May 2022 and had been off since that time. The worker advised that the treating psychologist and family physician recommended returning to work from November 2021 to May 2022 as exposure therapy for their PTSD and that they stopped working in May 2022 and moved to a different province in October 2022. The worker advised the WCB they were seeing a new family physician who was treating their PTSD symptoms with medication and had referred them to a psychiatrist. The worker noted their physician did not believe they could return to work at the present time and provided a retroactive sick note back to 2018. The worker stated their belief they required further exposure therapy prior to attempting a return to work. The worker confirmed they would provide the examining psychologist with their medical records for the call-in examination on March 4, 2024 and that they would not authorize the WCB to receive their income tax information from the CRA.

The worker’s tax preparer submitted a copy of the 2017 Statement of Business Activities to the WCB on March 8, 2024. On March 14, 2024, the WCB again advised the worker they required a signed CRA authorization before a further review of their average earnings would be conducted.

On March 25, 2024, the examining psychologist submitted their report to the WCB. The psychologist confirmed they met with the worker on March 4, 2024, who reported they were victim of a robbery while at work and had experienced persistent psychological symptoms since that time and were not able to return to work. The psychologist outlined the medical reports as provided by the worker which they reviewed and indicated the information appeared to be incomplete. After assessing the worker, the examining psychologist provided the worker did not currently meet the diagnostic criteria for a psychiatric condition in relation to the January 20, 2018 workplace incident, and that the evidence did not support the worker was totally disabled from working since approximately October 2020, noting the treating psychologist found the worker was in full remission in December 2020. The psychologist noted the worker reported a reemergence of their symptoms in mid 2022 but the psychologist could not determine if those symptoms were as a result of a recurrence from the workplace accident or due to other factors. The psychologist also noted the worker may have discontinued work in May 2022 due to being offered limited work hours rather than psychological concerns.

The WCB advised the worker on April 25, 2024 that there was no change to the June 24, 2021 decision that they were not entitled to wage loss benefits after June 22, 2020. On April 26, 2024, the WCB wrote to the worker indicating that as the worker had not provided verifiable income information, their average earnings calculation remained correct and would not be reviewed without that information. On the same date, the worker requested Review Office reconsider both decisions. The worker provided additional information and documents to Review Office in support of their appeal.

Review Office determined on July 18, 2024 that the worker’s average earnings were correctly calculated, and the worker was not entitled to wage loss benefits after June 22, 2020. The worker’s representative filed an appeal with the Appeal Commission on March 3, 2025 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, regulations under the Act and the policies established by the WCB's Board of Directors. The provisions of the Act and WCB policies 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 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 because 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. Section 27 of the Act allows the WCB to provide medical aid “as the board considers necessary to cure and provide relief from an injury resulting from an accident.” The Act also sets out how a worker’s loss of earning capacity is determined. Section 40 of the Act provides, in part, that:

Calculation of loss of earning capacity 

40(1) The loss of earning capacity of a worker is the difference between 

(a) the worker's net average earnings before the accident; and 

(b) the net average amount that the board determines the worker is capable of earning after the accident; 

which amount shall not be less than zero.

The method for calculating a worker’s average pre-accident earnings is set out in s 45 of the Act 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.

The Act also provides in s 60(2.1) that the WCB may deem a person who performs work for the benefit of another person to be a worker, within the meaning of worker in the Act, and permits the board to determine an amount that “shall be deemed to be the earnings of” that worker.

The WCB established Policy 35.10.50, Status of Workers, Independent Contractors and Employers (the “Status of Workers Policy”) which outlines the circumstances in which the WCB will deem a service provider to be a worker under the Act and the consequences that flow from this in terms of who is responsible for paying for the service provider's coverage. The policy also provides guidance on how to determine the amount of a worker's assessable earnings when they do not receive a T4 slip from the employer. This policy sets out that:

“Once the WCB has determined that a service provider is a worker within the meaning of the Act, and that his or her principal is an employer, the WCB must determine the amount of assessments the employer is required to pay in relation to that worker. …In circumstances when a worker is paid under a contract, assessable earnings can be more difficult to calculate. The WCB has developed a Labour Percentage Schedule to separate the labour portion of a contract from the price of materials and equipment. …It is important to note that the Labour Percentage Schedule reflects a general guide for various industries. The WCB will also consider documentation provided by employers and/or workers when determining a worker's assessable earnings. The Labour Percentage Schedule is included in the Administrative Guidelines.

The WCB established Policy 44.80.10.10, Average Earnings (the “Average Earnings Policy”) which outlines how the WCB determines a worker’s average earnings at the time of a compensable injury. The Policy outlines three formulae, the regular earnings formula, the average yearly earnings formula, and the probable yearly earnings formula, to determine a worker’s average earnings and sets out that the formula used is the one that “best represents the worker’s employment and earnings pattern before the accident.” 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. In establishing average earnings, the WCB may also include income from concurrent employment if worker’s ability to earn that income is affected by the compensable injury. This policy provides that the appropriate formula from Schedules A - C of the policy will be used to calculate and substantiate actual average earnings from self-employment, and that if the formula result is positive, this concurrent income will be included in average earnings. Otherwise, the worker’s self-employment income is not included in average earnings.

The WCB has also established Policy 44.80.10.40, Net Average Earnings (the “Net Average Policy”) to outline the probable deductions that may be used in calculating a worker’s net average earnings. This policy sets out that after the determines the worker's average earnings before the accident as outlined in the Average Earnings Policy, the WCB then calculates amounts representing probable deductions for income tax payable, Canada Pension Plan contributions, Employment Insurance premiums and other deductions as outlined in the Regulations. Those amounts are deducted from “average earnings” to arrive at the worker’s “net average earnings.”

The WCB has also established Policy 44.10.20.60, Recurring Effects of Injuries and Illnesses (Recurrences) (the “Recurrence Policy”) which outlines how the WCB determines if the worker has experienced a recurrence. This policy notes that many workers return to employment after a workplace accident and later experience a renewal of symptoms, and that, in such cases, the WCB must determine whether the worker has experienced a recurrence of a previous workplace injury, or whether their current condition is caused by a new and separate intervening event.

Worker’s Position

The worker appeared in the hearing represented by a worker advisor who made oral submissions and relied upon a written submission provided to the panel in advance of the hearing.

The worker’s position in relation to the question of wage loss benefit entitlement after June 22, 2020 is that the worker is entitled to further wage loss benefits beginning on May 6, 2022 based on the evidence of the treating psychologist who reported the worker was at that time disabled from work as a result of a relapse of their compensable injury. The worker confirmed that they did not initially have a loss of earning capacity upon their return to work in June 2020.

The worker’s position in relation to the calculation of their average earnings in that the WCB failed to demonstrate that the labour percentage formula was most appropriate and ought to have rather applied the net business income formula as provided for in Schedule A of the Average Earnings Policy, relying on the business income and expense information provided by the worker in support of that calculation. Further, the worker submits that the WCB ought to have considered and included their 2017 self-employment income in calculating their average earnings. The worker submits that the information provided to the WCB is “complete and reliable enough” for the WCB to include in the calculation of their average earnings, and that the verification of income from Canada Revenue Agency is not required under the provisions of the Average Earnings Policy.

Employer’s Position

The employer did not participate in the appeal.

Analysis

The worker appealed the Review Office decision that their average earnings were correctly calculated, and that they are not entitled to wage loss benefits after June 22, 2020. For the worker’s appeal on the question of the average earnings calculation to succeed, the panel would have to determine that the WCB did not correctly apply the provisions of the Act and Policy in determining those earnings. For the appeal on the question of wage loss benefit entitlement to succeed, the panel would have to find that the worker had a loss of earning capacity after June 22, 2020 as a result of the compensable injury sustained in the workplace accident. As outlined in the reasons that follow, the panel was unable to make such findings, and therefore, the worker’s appeal is denied on both questions.

Is the worker entitled to wage loss benefits after June 22, 2020?

The question of the worker’s entitlement to wage loss benefits after June 22, 2020 requires the panel to consider if, at that time, the worker had a loss of earning capacity as a result of the compensable workplace injury. The panel finds that the evidence does not support such a finding, and this is consistent with the worker’s own position in respect of this question.

A psychiatric consult report dated June 22, 2020 noted the worker’s plans to return to full-time work the following week after 21 months off work. At that time, the psychiatrist provided recommendations for medication in relation to the PTSD diagnosis and noted the worker expressed concern about how their return to work would affect their PTSD symptoms. The treating psychologist reported to the WCB on February 8, 2021 that “Following some of our work together, [the worker] was able to return to work for [the employer] in June, 2020.” The WCB psychiatric advisor considered these reports on May 18, 2021, and concluded that as of June 22, 202, “symptoms that would meet full criteria for the DSM-5 diagnosis of PTSD no longer were present” although they had some residual symptoms. The panel noted that neither the treating psychologist nor the consulting psychiatrist noted any limitations or restrictions in relation to the worker’s return to work after June 22, 2020. While the worker continued to be treated for PTSD after that date, the evidence does not indicate that the worker sustained a loss of earning capacity as a result of that condition upon their return to work in June 2020.

As outlined in the submissions in support of the worker’s appeal, there is evidence that the worker did not work consistently after October 2020 and experienced an increase in symptoms after that time. The panel notes the WCB has not decided the question of whether the worker later experienced a recurrence of their injury resulting in a further loss of earning capacity.

Based on the evidence before us and on the standard of a balance of probabilities, the panel is satisfied that the worker was capable of returning to work without limitations or restrictions, as of June 22, 2020. As such, we find that the worker is not entitled to wage loss benefits after that date; however, we confirm that this is a point in time decision and make no findings as to the nature, duration, or extent of the worker’s entitlement to wage loss benefits after this point in time, should the WCB determine there is evidence of a recurrence or relapse or other continuation of the compensable injury.

Are the average earnings correctly calculated?

The panel considered whether the WCB erred in applying the provisions of the Act and applicable policies in making these calculations.

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 all employment and employment insurance benefits. The Average Earnings Policy applies. That policy sets out three possible methods that the WCB will use in determining a worker's average earnings and outlines that the formula to be used it the one that “best represents the worker’s employment and earnings pattern before the accident.” When a worker’s income is irregular, 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.”

The panel noted the WCB found that this worker is a deemed worker under the provisions of s 60(2.1) of the Act, such that their earnings, although paid as self-employment or contract income, are considered employment income for WCB purposes. The Average Earnings Policy, in Schedule B, sets out that a deemed worker’s average earnings are generally based on reported earnings calculated using the labour percentage formula of gross contract earnings as reported by the employer multiplied by the applicable labour percentage set out in Guideline 3. Reported earnings are earnings declared on the employer's accident (incident) report. When the employer's accident report includes company commissions and wages paid to other workers in these figures, the reported earnings will be adjusted to exclude these amounts before the designated labour percentage is applied to determine the short-term average earnings level.

The Average Earnings Policy further provides that if a worker disagrees with the labour percentage set out in Guideline 3, they can request an Average Earnings Review. In such a process, when the WCB has sufficient information, it calculates the worker’s average earnings based on the net business income formula set out in Schedule A to the policy, and then compares the results of the two formulas, selecting the higher amount to represent the worker’s short-term average earnings. In the case before us, the panel agrees with the WCB’s determination that the average earnings formula is the one that “best represents” the worker’s earnings pattern before the accident. The panel noted that the worker did not dispute this determination but rather argued that the WCB ought to have calculated and relied upon their net business income instead of using the labour percentage formula.

The panel considered whether the WCB appropriately considered the worker’s self-employment income, in accordance with the provisions of the Policy, which includes net business income plus depreciation/amortization plus business use of home expenses. We note that the worker provided their own business records and submitted a copy of their 2017 income tax filing but would not consent to provide or permit the WCB to obtain their complete income tax return documents as requested, for 2016 and 2017 and subsequent years for which they were seeking benefits. The worker’s position is that the information they provided, including the information from their income tax preparer, ought to suffice for purposes of calculating their net business income; however, the panel noted that the WCB was not satisfied with that information and the Average Earnings Policy sets outs that “when the WCB has sufficient information…” it will calculate the worker’s average earnings based on the net business income formula. The evidence in the worker’s claim file indicates the WCB did not consider the information provided to be sufficient and requested the worker to authorize obtaining verification of that information from the CRA. The panel does not find that to be an onerous requirement, nor do we agree with the worker that their own tax preparer’s submission to CRA ought to suffice. As such, given the worker’s refusal to provide the requested additional information to verify their self-employment income, the panel finds that the WCB appropriately used and relied upon the labour percentage formula in recalculating the worker’s average earnings.

Based on the evidence before us and on the standard of a balance of probabilities, we are satisfied that the WCB correctly applied the applicable policy in determining the worker’s average earnings using the information available. Should the worker provide additional information to the WCB as requested, they may be entitled to a further review and recalculation of those earnings.

The worker’s appeal on both questions is denied.

Panel Members

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

Recording Secretary, J. Lee

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

Signed at Winnipeg this 14th day of July, 2025