The Appeal CommissionThe Workers Compensation Act of Manitoba

Preamble

The employer appealed the Workers Compensation Board ("WCB") decision that they are not entitled to cost relief due to a pre-existing right ankle condition. At a file review held on July 7, 2026, the panel considered the employer's appeal.

Issue

Is the employer entitled to cost relief due to a pre-existing condition?

Decision

The employer is not entitled to cost relief due to a pre-existing right ankle condition.

Background

The WCB accepted the worker's claim for an injury arising out of an accident that occurred at work on April 3, 2024. The worker described the injury as occurring when climbing a ladder on a vehicle and feeling their left knee pop when the knee over-extended. The Employer’s Accident Report submitted to the WCB on April 5, 2024 described a similar incident. The worker sought medical treatment on April 3, 2024, reporting tenderness and swelling in their left knee. An x-ray taken that day noted normal findings. The worker returned to work on light duties on April 8, 2024 and to regular duties on April 9, 2024, while using a knee brace. The worker reported further difficulties with their left knee on May 2, 2024 and discontinued working on May 13, 2024 when the employer could no longer accommodate their injury.

In discussion with the WCB on May 9, 2024, the employer queried if the worker’s left knee difficulties related to a prior injury, noting the worker had a “significant limp” due to that injury. In further discussion with the WCB on May 24, 2024, the employer again raised their concerns with respect to the worker’s previous injury and its potential impact on the April 3, 2024 incident. The WCB advised it would investigate further and determine if the employer would receive cost relief.

A July 9, 2024 MRI study of the worker' left knee indicated findings including complex tearing of the medial meniscus, partial-thickness tearing of the superficial medial collateral ligament, minimal to mild tri-compartment osteoarthritis and a small joint effusion with synovitis and trace Baker’s cyst. A WCB orthopedic surgical advisor reviewed the worker's file on September 10, 2024 and concluded, in response to the questions raised by the WCB case manager regarding the worker’s prior right ankle injury, that “Loss of inversion/eversion movements in the right foot and ankle could lead to slipping while ascending or descending a latter (sic), which could in turn lead to an injury occurring on the left knee.”

On September 27, 2024, the WCB questioned the worker further as to how the injury occurred. The worker stated they did not slip or have any instability to their right leg when climbing the ladder and confirmed their left leg was completely straight.

The WCB advised the employer on October 7, 2024 that the worker confirmed the mechanism of injury and that they did not slip while climbing the ladder. The WCB advised that to accept the employer's position that the worker’s ankle injury was a pre-existing condition that caused the worker’s left knee injury, there would have to be evidence of a slip or loss of balance. On October 10, 2024, the WCB case manager met with the employer at the jobsite and the employer demonstrated how the worker should have climbed the ladder on the vehicle. The employer also explained that due to the worker’s previous injury, they would not have been able to get good footing on the narrow steps of the ladder and as such, would not have been able to distribute their weight between the right and left legs, with most of the force going to their left leg. The employer noted their belief that the worker would have been off balance, with all their weight and force coming down on their left leg causing the injury to their left knee.

On November 4, 2024, the WCB advised the employer by letter that they are entitled to 50% cost relief for the worker’s claim as it determined the worker had a pre-existing condition that contributed to the severity of the worker’s injury. The employer requested Review Office reconsider the WCB’s decision, submitting that the worker was fully aware of their own limitations and the worker's negligence put them in jeopardy of injury, causing the workplace accident. As such, the employer submitted it should be entitled to 100% cost relief.

Review Office determined on December 10, 2024 that the employer is not entitled to cost relief due to a pre-existing condition. Review Office found the worker’s pre-existing right ankle condition did not contribute the severity of their compensable left knee injury and further, did not prolong the worker’s recovery from the left knee injury. Therefore, the employer is not entitled to 50% cost relief.

The employer appealed to the Appeal Commission on March 30, 2026 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 under the Act, and policies of the WCB's Board of Directors. The issue on appeal relates to the employer’s request for cost relief. Section 81(1) of the Act provides authority for the WCB to relieve an employer of responsibility for certain claim-related costs, and sets out, in part, that:

Annual assessment for accident fund

81(1) For the purpose of creating and maintaining an adequate accident fund, the board shall every year assess and levy upon and collect from the employers in each class by an assessment or by assessments made from time to time rated upon the payroll, or in such other manner as the board considers advisable or necessary, sufficient funds, according to an estimate to be made by the board in each year 

… 

(c) to provide a fund to meet the part of the cost of claims of workers that, in the opinion of the board, results from: 

(i) pre-existing or underlying conditions…

The WCB Policy 31.05.10, Cost Relief/Cost Transfer – Class E Employers (the "Cost Relief Policy"), outlines circumstances in which claim costs may be removed from the claim costs experience of a Class E accident employer and assigned to a collective cost pool as provided for in s 81(1) of the Act. The Cost Relief Policy effective January 1, 2023 applies to all cost relief and cost transfer decisions made on or after that date. Cost relief includes circumstances where a worker's pre-existing condition contributes to the severity of their work-related injury or significantly prolongs their recovery as detailed in Schedule A - Pre-Existing Conditions ("Schedule A"). Schedule A outlines that the WCB will provide cost relief to employers when "…a worker's pre-existing condition:

• contributes to the severity of their work-related injury; or 

• significantly prolongs their recovery, and the worker's time loss from work is greater than 12 weeks."

Such cost relief is in the amount of 50% of the claim costs, exclusive of the costs of any impairment award.

The WCB established Policy 44.10.20.10, Pre-existing Conditions (the “Pre-existing Policy”), in effect for decisions on or after January 1, 2023, which defines a pre-existing condition as "…any medical condition the worker had prior to their workplace injury" and notes that such pre-existing condition may contribute to the severity of a workplace injury or significantly prolong a worker's recovery. This Policy provides that the application of cost relief for pre-existing conditions is set out in Schedule A of the Cost Relief Policy.

Employer's Position

The employer's position is set out in a written submission provided to the Appeal Commission on June 26, 2026.

The employer submits that it is entitled to cost relief on the basis the conditions outlined the Cost Relief Policy are met. Specifically, the employer submits it should receive 100% cost relief, or at minimum 50% cost relief on the basis that the worker's prior right ankle injury resulted in severely reduced mobility and longstanding functional limitations and that the worker's injury occurred while climbing a mounted ladder rather than the required portable ladder, thus increasing the worker's reliance on ankle stability. The employer submits that the WCB orthopedic advisor confirmed that reduced ankle mobility can cause imbalance during ladder ascent, potentially injuring the opposite limb. Further, the employer submits that the worker's recovery from their left knee injury has been prolonged, consistent with the impact of a significant pre-existing condition. The employer submits that the pre-existing right ankle condition was the primary cause of the worker's left knee injury and as such the WCB should provide complete cost relief, or at minimum 50% cost relief as originally determined.

Worker's Position

The worker did not participate in the appeal.

Analysis

This appeal arises out of the WCB’s decision that the employer is not entitled to any cost relief for a pre-existing right ankle condition in respect of the worker’s claim arising out of the accident of April 3, 2024. For the employer’s appeal to succeed, the panel would have to determine that the worker has a pre-existing right ankle condition that contributed to the severity of their compensable left knee injury or significantly prolonged their recovery from that injury with time loss greater than 12 weeks. Based on the evidence before the panel, we are not able to make such findings and therefore the employer’s appeal is denied.

In reviewing the claim and considering the employer's submission, the panel noted that the employer appears to have relied upon a previous version of the WCB's Cost Relief Policy. As outlined in Note 10 of the Cost Relief Policy in effect for decisions on or after January 1, 2023, that Policy was revised by Board Order No. 41/22 on December 15, 2022 with policy changes including the elimination of 100% cost relief for pre-existing conditions. As such, although the employer is seeking cost relief of 100%, the Cost Relief Policy currently in effect does not allow for cost relief greater than 50% as specified in that policy.

The panel also noted, in reviewing the claim and considering the employer's submission, that although the WCB determined on November 19, 2025 that the worker has a pre-existing condition of left knee osteoarthritis, the WCB has not, to date, adjudicated the question of cost relief in relation to whether that specific pre-existing condition contributed to the severity of the worker's compensable left knee injury or significantly prolonged the worker's recovery from the compensable left knee injury. Rather, the WCB has limited its adjudication of the employer's request for cost relief to the specific and narrow issue raised by the employer which is the potential impact of the worker's pre-existing right ankle injury and condition upon the worker's compensable left knee injury. As such, the panel makes no findings or determinations in respect of the cost relief implications in relation to the impact, if any, of the worker's pre-existing left knee osteoarthritis condition upon the compensable left knee injury.

The panel reviewed the evidence as to whether the worker's pre-existing right ankle condition contributed to the severity of their left knee injury or significantly prolonged their recovery from the compensable injury. We noted the medical reporting from the treating professionals contains no reference to any mechanism of injury related to the worker's right ankle condition nor any impact of that condition upon the worker's left knee injury, neither in terms of causation, severity or recovery.

The panel also considered the opinion of the WCB orthopedic surgery advisor relied upon by the employer. We noted the WCB advisor's September 10, 2024 comments that the worker's right ankle condition "would limit inversion and eversion of the right ankle/foot" which "could lead to slipping" while climbing or descending a ladder, which "could in turn lead to an injury occurring to the left knee." However, we also noted the absence of any evidence that this did occur and the worker's specific assertions that it did not occur. The employer speculates that it could have and likely did occur but provides no evidence in support of that position. The panel finds the medical advisor's conclusion to be speculative and unsupported by the evidence as to the actual mechanism of injury.

Based on the evidence before the panel, and applying the standard of a balance of probabilities, we are satisfied that the worker's pre-existing right ankle condition neither contributed to the severity of their compensable left knee injury nor significantly prolonged their recovery from that injury. Therefore, applying the provisions of the Cost Relief Policy in effect, the employer is not entitled to cost relief in relation to the worker's pre-existing right ankle condition. As outlined above, the panel makes no findings as to employer's entitlement to cost relief in relation to the worker's pre-existing left knee osteoarthritis. This appeal is denied.

Panel Members

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

Recording Secretary, J. Lee

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

Signed at Winnipeg this 9th day of July, 2026