Important legislative changes proposed
On April 27, 2017, Bill 127, Stronger, Healthier Ontario Act (Budget Measures), 2017, passed first reading in the Ontario Legislature.
Bill 127 proposed a number of important changes to the Workplace Safety and Insurance Act, 1997 and pre-1997 Workers’ Compensation Act. The notable changes are:
- Modification of the statutory bar on entitlement for mental stress disabilities.
- Introduction of a specific Board policy making power.
- Increases to the statutory “minimum” for full loss of earnings and introduction of a new statutory “minimum” for partial loss of earnings.
- Removal of provisions that reduce some older workers’ pension supplements by the amount of any old age security increase. And modification of the pre-1997 statute to allow 147(4) supplements to be indexed even if the indexed amount exceeds the amount of a full old age security pension.
- Housekeeping adjustments to increase NEL and survivor benefits.
Mental stress restriction modified
Bill 127, Stronger, Healthier Ontario Act (Budget Measures), 2017, would remove part of the current statutory limitation on compensation for mental stress injuries. The current Act states that mental stress is not compensable except for “an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of his or her employment.”
The Government was forced to remove this discriminatory provision by:
- Three successful Charter challenges to the legislation as discriminatory (none of which the Government appealed);
- Years of intense stakeholder advocacy and criticism; and
- Complaints to the Ombudsman Ontario and the Ontario Human Rights Commissioner.
Three years after the first WSIAT decision stating the law was unconstitutional, the Government has finally decided to act. The revised Act will state that a worker is entitled to benefits for “chronic or traumatic mental stress”. It removes the limitation that the mental stress injury must arise as an “acute reaction”, resulting from a “sudden and unexpected” “traumatic event”.[i]
The legislation would retain the limitation that mental stress is not compensable if it arises out of employment decisions such as a change to working conditions or discipline. This provision has not yet been successfully challenged as discriminatory, though it may be in the future. Workers who suffer physical injuries as a result of employment decisions are not denied benefits.
Board granted specific policy making power
In a potentially related change, Bill 127 would for the first time formalize the Board’s power to make policies regarding benefits.[ii] It would state that the Board can create policies that concern:
- the interpretation and application of the Act;
- “evidentiary requirements for establishing entitlement to benefits”; and
- “the adjudicative principles to be applied for the purpose of determining entitlement to benefits”.[iii]
Worrisomely, Bill 127 would also revise the Act to state that the Board’s policies can provide that “different evidentiary requirements or adjudicative principles apply to different types of entitlements, where it is appropriate, having regard to the different basis for and the characteristics of each entitlement.”[iv]
The Board’s power to make policies is already implicitly recognized in the Act by virtue of section 126(1) which states, “If there is an applicable Board policy with respect to the subject-matter of an appeal, the Appeals Tribunal shall apply it when making its decision.” In addition, section 161(2) of the Act states that the Board has the duty to evaluate the consequences of any proposed changes in “benefits, programs and policies to ensure that the purposes of this Act are achieved.” And section 161(3) states that the Board must monitor developments in the understanding of occupational disease and ensure that advances in health sciences are reflected in benefits, services, programs and policies in a way that is consistent with the purposes of the Act.
Of note, in Martin v. Workers’ Compensation Board, the Supreme Court of Canada interpreted sections 126 and 161 of the WSIA as indicating that the Ontario legislature, like all other provincial legislatures in Canada, “contemplate[d] the consistent adjudication of claims through the application of policies”.[v]
While the Board’s ability to make policies therefore appears reasonably well established, the proposed legislative change might undermine long-standing legal and adjudicative principles by explicitly allowing the Board to limit entitlement by policy. This could play out in a number of potentially pernicious ways.
Potential implications: Mental stress
The most obvious possible reason for the introduction of this policy making power is to allow the Board to (re)limit entitlement to mental stress injuries. The Board may want to impose new evidentiary standards and adjudicative tools in mental stress claims, for example:
- a predominant cause standard;
- an “average worker” type analysis where the worker must show that the work-related stressors were excessive or unusual or would have predisposed an average worker to injury; or
- a requirement for “objective confirmation” of the workplace events.
These types of limits have been imposed in other provinces. For a summary of how different Boards across the country limit mental stress entitlements see http://awcbc.org/wp-content/uploads/2014/02/Stress.pdf. If implemented, the impact of such policy restrictions could be as severe as the statutory bar that is being struck down. Since Board policies are essentially binding on the Appeals Tribunal, they can significantly modify substantive rights.
In Martin v. Workers’ Compensation Board, the Supreme Court of Canada found that such policy limitations on mental stress injuries were not unreasonable. By virtue of Board policy, workers in Alberta seeking entitlement for chronic onset stress must prove that:
- there is a confirmed psychological or psychiatric diagnosis;
- the work-related events or stressors are the predominant cause of the injury;
- the work-related events are excessive or unusual in comparison to the normal pressures and tensions experienced by the average worker in a similar occupation; and
- there is objective confirmation of the events.[vi]
In addition, Board policy in Alberta states that no entitlement will flow from “duties reasonably expected by the nature of the worker’s occupation, normal pressures and tensions include, for example, interpersonal relations and conflicts, health and safety concerns, union issues, and routine labour relations actions taken by the employer…”.
In Martin, the Supreme Court held that the Board policy “to require excessive or unusual workplace events is not inconsistent with the broad definition of “accident” in s. 2 of the GECA”.[vii] The Supreme Court stated that the definition of “accident” “cannot be solely dependent on the worker’s subjective view of evidence” and that an “event triggering a physical injury will often be easier to identify than one giving rise to a mental injury.”[viii] Notably, in Martin, the worker did not challenge the policy’s requirements as ultra vires or not authorized by the Alberta Workers’ Compensation Act.
Martin doesn’t mean the Board would have a free pass in introducing discriminatory evidentiary requirements by policy. In Martin, the Supreme Court did not consider whether the Board’s policy violated the Charter’s equality guarantee. It is therefore unresolved whether policy limitations targeting mental stress cases might be found discriminatory.[ix]
The Court’s analysis in Martin, like the “average worker test” some WSIAT decision makers have adopted[x], rests on the understanding that psychological injuries are harder to assess and adjudicate than physical injuries. In the seminal decision holding the WSIA’s statutory limitations unconstitutional, the WSIAT cast doubt on this narrative. The Panel observed, “Determining causation is often difficult due to the multifactorial nature of many conditions (from carpal tunnel syndrome to lung cancer), the lack of conclusive epidemiological evidence on the particular exposure or working conditions in issue, and the possibility of inaccurate or incomplete history-taking by clinicians. The unreliability of a worker’s subjective perceptions is a matter for evaluation in both physical injury claims and mental stress claims alike.”[xi]
Hopefully, as the Board decides what its policies will say about mental stress, it will consider the take-home message from Decision No. 2157/09: that each case should be adjudicated on its own merits and justices. There is no principled reason the Board should modify the law to impose special tests on workers who suffer psychological injuries instead of physical ones.
Other possible implications
By giving the Board express power to introduce “different evidentiary requirements or adjudicative principles [for] different types of entitlements”, the legislature may be condoning or encouraging the Board to limit statutory rights. There are many entitlements that the Board might decide should have enhanced requirements for compensability because they are more “difficult” to adjudicate. The following type of entitlements seem vulnerable, for example:
- psychological injuries like depression or anxiety that arise following physical injuries on the job (Board policy already attempts to limit these entitlements by stating that they generally temporary, for example);
- chronic pain disability;
- repetitive strain injuries like carpal tunnel syndrome;
- disablements like gradual onset back injuries; and
- occupational diseases like cancer.
If the government wants to introduce such limitations, which in effect could change the basic principles underlying the workers’ compensation system like the significant contributing factor test, it should do so in the Parliament so that there can be proper public oversight and debate.
Adjustment to Annual Minimums
There were two proposed amendments to the annual minimum provisions of the Act. Both will increase benefits to some lower-income workers and therefore are welcome changes.
Full Loss of Earnings
The first is an amendment to increase the statutory “minimum” for full loss of earnings from $15,312.51[xii] to $22,904.44. This “minimum” is not actually a minimum. It means that if a worker’s full net average earnings before the injury is less than the designated amount, they could receive more than 85% of their net average earnings from the Board, up to at most 100% of their net average earnings.
Partial Loss of Earnings
Bill 127 proposes to add a new provision creating a similar protection for lower-income workers receiving partial loss of earnings. This provision would mean that some workers could get credit for more than 85% of their pre accident net average earnings in calculating partial loss of earnings. The proposed provision would state:
(2.2) The minimum amount of the payments for partial loss of earnings is,
(a) if the worker’s net average earnings before the injury is less than $17,559.88, the difference between the worker’s net average earnings before the injury and the net average earnings that the worker earns or is able to earn in suitable and available employment or business after the injury; or
(b) if the worker’s net average earnings before the injury is greater than or equal to $17,559.88, but 85 per cent of the worker’s net average earnings before the injury is less than $17,559.88, the higher of,
(i) the difference between $17,559.88 and the net average earnings that the worker earns or is able to earn in suitable and available employment or business after the injury, and
(ii) 85 per cent of the difference between the worker’s net average earnings before the injury and the net average earnings that the worker earns or is able to earn in suitable and available employment or business after the injury.
An example may help in understanding how this provision would work. For example:
- A worker whose pre accident net average earnings is $18000.
- 85% of their net average earnings would be $15300, so less than $17.559.88.
- Assume the worker’s deemed net average earnings is $16500.
- Partial loss of earnings previously would have been 85% of the difference between pre accident net average earnings and deemed net average earnings which would = $0.
- Now partial loss of earnings will be the difference between $17559.88 and deemed NAE and would = $1059.88.
Pre-1990 Supplement Amendments
Bill 127 proposes to amend the pre-1997 Workers’ Compensation Act to remedy a specific injustice impacting some workers who have had their already low WSIB benefits clawed back for every dollar they received in old age security increases. This injustice had been covered in the press and was the subject of a private member’s bill.
The new provisions would mean that the extra $200 (147(14) supplement) would not be reduced by the amount of any increases to worker’s old age security payments or with any regard to old age security at all. In effect, any worker who qualifies for the 147(14) supplement will continue to receive it regardless of the amount of their old age security, as long as their pension, average earnings (if any) and 147 (14) supplement together don’t exceed their maximum pre-accident earnings (75% of gross for pre-1985 injuries; 90% of net for pre-1989 injuries).
In addition, if workers had their 147(14) supplements eliminated or reduced by virtue of the now-repealed provisions 147(16) or (17), they will be able to ask the WSIB to recalculate their supplement and “pay the worker any difference owing”.
One concern about these revisions. The onus appears to be on the worker whose benefits may have been reduced by 147 (16) or (17) to notify the Board and request recalculation. This is unfortunate. The Board should take the responsibility to identify workers who may have been affected and notify them. It is exclusively older workers who are affected, most of them lower income. These workers should not be denied benefits to which they are entitled because they don’t know about a legal change.
Bill 127 also appears to modify the “ceiling” on 147 (4) supplement benefits that previously stated that the supplement could not exceed the amount of a full monthly pension for old age security under the Old Age Security Act, including amendments. Starting on January 1, 2018 (not retroactive), the Board will be able to index 147(4) supplements even if the indexed supplement exceeds the amount of a full old age security pension.
Adjustment to NEL and survivors’ benefits payments
Bill 127 proposes to increase the statutory baseline for non-economic loss payments and survivors’ benefits. However, these are housekeeping adjustments. They increase the statutory amounts to reflect how these benefits have already been escalated over the years since the statute was last revised.[xiii]
[i] WSIA, ss. 13(4) and (5).
[ii] The existing Act states that the Board has the power to make policies “concerning the premiums payable by employers under the insurance plan” but it is silent on the Board’s right to make other policies thought the powers of the Board provision of the Act is inclusive not exclusive; section 159. The Act also specifically requires the Board to make certain policies regarding its enforcement of employer payment and compliance matters, and to comply by those policies; s. 148.
[iii] 8 (1) Subsection 159 (2) of the Act is amended by adding the following clauses:
(a.1) to establish policies concerning the interpretation and application of this Act;
(a.2) to establish policies concerning evidentiary requirements for establishing entitlement to benefits under the insurance plan;
(a.3) to establish policies concerning the adjudicative principles to be applied for the purpose of determining entitlement to benefits under the insurance plan
[iv] (2) Section 159 of the Act is amended by adding the following subsection:
(2.1) A policy established under clause (2) (a.2) or (a.3) may provide that different evidentiary requirements or adjudicative principles apply to different types of entitlements, where it is appropriate, having regard to the different basis for and the characteristics of each entitlement.
[v] Martin v. Workers’ Compensation Board, 2014 SCC 25 at para. 47.
[vi] Ibid at para. 48. As in Ontario, the Alberta Commission is required by the Alberta Workers’ Compensation Act to apply the Board’s policies.
[vii] Martin v. Workers’ Compensation Board, at para. 49.
[viii] Martin at para. 50.
[ix] In Martin, the worker had argued that the policy conflicted with Charter values because it imposed a more rigorous test for entitlements on workers with psychological injuries as opposed to workers with physical injuries. The Court decided it was not appropriate to decide the Charter values question because it would act as a Charter challenge to the policy without a proper record.
[x] In adjudicating appeals involving mental injuries that arose out of workplace stressors (rather than secondary to a physical injury on the job), the Tribunal has sometimes applied an “average worker test”. Under the average worker test, decision makers generally consider whether 1) workers of average mental stability would find the workplace events stressful and 2) whether they would be at risk of suffering a disabling mental reaction to such stress. While the Tribunal cast serious doubt on the average worker test in Decision No. 665/10I2, in Decision No. 480/11, 2014 ONWSIAT 1527 (CanLII), a different Panel continued to defend a version of the average worker test, although perhaps a modified version whereby it is not determinative in all cases, but rather instructive as a general rule. The Panel explained that “it is relevant and not improper to consider whether the events complained of would normally be expected to be stressful to the average worker as long as the specific facts of the worker’s case may also be considered.” The Panel cited Martin as support for its position.
[xi] Decision No. 2157/09, 2014 ONWSIAT 938 (CanLII) at para. 232.
[xii] This amount had actually been escalated by the Board $17,559.88 in 2017.
[xiii] The current Act s. 46 states the permanent impairment award, for example, is calculated by multiplying the percentage of the worker’s permanent impairment and $51,535.75 plus $1145.63 for each year by which the worker’s age at the injury was less than 45 or minus $1145.63 for each year by which the worker’s age at the injury was greater than 45. The maximum amount to be multiplied by the percentage of the worker’s impairment is $74,439.52 and the minimum amount is $28,631.22.
The revised Act would substitute $51,535.37 as the baseline amount and $1,145.63 as the amount by which the award is increased or decreased based on age. It would increase the maximum amount to $85,359.27 and the minimum to $28,631.22. Adjustments are also made to survivors’ benefits under section 48 of the Act. While these seem significant, they are just adjustments to catch the statute up with the current 2017 escalated amounts already used by the Board (see WSIB Facts and Figures 2017, online: file:///C:/Users/m_yachnin/Downloads/Facts%20and%20Figures%202017%20.pdf).