r v. WorkSafe NB, 2010 NBCA 29

COURT OF APPEAL OF NEW BRUNSWICK 109-09-CA JOSEPH FARQUHAR APPELLANT JOSEPH FARQUHAR APPELANT - and - - et - WORKSAFE NB RESPONDENT TRAVAIL SÉCURITAIRE NB INTIMÉ Farquhar v. WorkSafe NB, 2010 NBCA 29 Farquhar c.

Travail sécuritaire NB, 2010 NBCA 29 CORAM: The Honourable Justice Turnbull The Honourable Justice Richard The Honourable Justice Quigg CORAM : L’honorable juge Turnbull L’honorable juge Richard L’honorable juge Quigg Appeal from the Appeals Tribunal of WorkSafe NB: June 22, 2009 Appel interjeté à l’encontre de la décision rendue par le Tribunal d’appel de Travail sécuritaire NB : Le 22 juin 2009 History of Case: Historique de la cause : Decision under appeal: Unreported Décision frappée d’appel : Inédite Preliminary or incidental proceedings: N/A Procédures préliminaires ou accessoires : s.o.

Appeal heard: November 19, 2009 Appel entendu : Le 19 novembre 2009 Judgment rendered: April 29, 2010 Jugement rendu : Le 29 avril 2010

Counsel at hearing: For the appellant: Joseph W.A. Farquhar Appeared in person For the respondent: Charles A. LeBlond, Q.C. Avocats à l’audience : Pour l’appelant : Joseph W.A. Farquhar a comparu en personne Pour l’intimé : Charles A. LeBlond, c.r. THE COURT The appeal is dismissed with costs. LA COUR L’appel est rejeté avec dépens.

The following is the judgment delivered by THE COURT [ 1 ] The issue in this case concerns whether or not certain employment benefits are “earnings” of an injured worker when determining his worker’s compensation benefits. [ 2 ] Joseph Farquhar appeals the June 22, 2009 decision of the WorkSafe NB Appeals Tribunal to deny the inclusion of his employer’s contribution to his:

(1) RRSP; and (2) health and welfare insurance coverage as part of his pre-accident earnings. The determination of the components of an injured worker’s pre-accident earnings is an essential prerequisite to the determination of an injured worker’s loss of earnings. “Pre-accident earnings means the daily, weekly, monthly or regular remuneration that the worker was receiving at the time of the injury […] as may appear to the Commission best to represent the earnings of the worker” (see s. 38.1(1) of the Workers Compensation Act , R.S.N.B. 1973, c. W-13 (the “ WC Act ”)). [ 3 ] Mr.

Farquhar experienced a work related injury on May 6, 2007. WorkSafe NB (formerly the Workplace Health, Safety and Compensation Commission) accepted his claim and provided him with “medical aid, weekly loss of earnings benefits and vocational rehabilitation”. However, WorkSafe NB (the “Commission”) denied his request to include his RRSP and health and welfare insurance benefits as part of his pre-accident earnings.

He appealed that denial to the Appeals Tribunal. [ 4 ] The Appeals Tribunal found as follows: It is the finding of the Appeals Panel that the employer’s contributions to the appellant’s registered retirement savings plan (RRSP) and to the health and welfare insurance coverage are not considered to be earnings under the compensation legislation. Therefore, these employer contributions are not to be included in the Commission’s calculation of loss of earnings payable. These contributions are 100 per cent paid by the appellant’s employer as an employment benefit and not based on earnings earned for work done.

It is understood that the appellant will receive these employment benefits for a specific period of time even if he is not working.

These contributions (payments) are made to a third party, not the appellant, and the Appeals Panel noted that, under the appellant’s Collective Agreement, Health and Welfare (Article 16) and Registered Retirement Plan (Article 17) are under a different

article than Classification, Rates of [P]ay and Special Allowances (Article 8). The Appeals Panel respectfully noted that the appellant relied heavily on the Commission’s policy 21-200 to present his case, however, these employer contributions are not included in the annual assessable earnings total collected by the Commission from the registered employers under compensation.

Therefore, [if it] were the intent of the Commission to include such employment benefits in average pre- accident earnings, then premiums would have to be collected so that the Commission could fulfill its financial and administrative responsibilities to workers and employers under that legislation. [pp. 6-7] [ 5 ] Annually, an employer is required to file with the Commission the “amount which he estimates he will expend for wages during the then current year […]” (see s. 53(1) of the WC Act ).

Based on that estimate, each employer is assessed a premium for that year to provide loss of earnings benefits to any of its “injured worker” employees. In this case, Mr. Farquhar’s employer neither included its RRSP employee contributions, nor the health and welfare insurance premium in such estimate. The Commission did not dispute the correctness of these exclusions. [ 6 ] In upholding the Commission’s decision, the Appeals Tribunal found that, in this case, Mr.

Farquhar’s RRSP and health and welfare insurance were employee non-cash benefits that were not components to be included in his pre-accident earnings and, thus, should be excluded from the calculation of his loss of earnings entitlement. [ 7 ] Mr. Farquhar’s sole ground of appeal is that the Appeals Tribunal erred “in ruling not to overturn the decision of the Commission’s case manager wherein Policy 21-200 lays forth the types of remuneration that are to be used when calculating an injured worker’s average earnings”. Specifically, he relies on two provisions in

section 3.2 of Policy 21-200 (remuneration received regularly and form part of an injured worker’s normal earning pattern) namely: • employer’s portion of RRSP contributions, if available to the recipient prior to age 65 • other payments by an employer(

s) made to or on behalf of injured workers, […] [ 8 ] The legislative scheme for determining an injured worker’s compensation benefits and the authority of the Commission and the Appeals Tribunal in doing so is set out in the WC Act and the Workplace Health, Safety and Compensation Commission Act , R.S.N.B. 1973, c. W-14 (the “ WHSCC Act ”). As noted earlier in paragraph 2, s. 38.1 defines pre-accident earnings with some specificity: “regular remuneration” that an injured worker was receiving when injured “as may appear to the Commission best to represent the earnings of the worker”.

Section 37 of the WC Act provides that for the purposes of sections 38 and 48 of the WC Act “regular remuneration” at time of injury includes what “may appear to the Commission best to represent the actual loss of earnings suffered by the worker by reason of the injury” (emphasis added). Section 34(2) (

c) of the WC Act prescribes that the Commission has the exclusive jurisdiction when determining “the amount of average earnings, average net earnings, loss of earnings […] arising out of an injury”.

And, s. 34(1) provides that any action or decision of the Commission pursuant to any power, authority or discretion with respect to the exercise of its exclusive jurisdiction is final and conclusive. [ 9 ] Pursuant to s. 21 of the WHSCC Act , the Appeals Tribunal is granted “all of the authority “conferred on the Commission […] to examine into, hear and determine all matters [arising] in any appeal to it […]” (s. 21(3)).

While decisions of the Appeals Tribunal are final, provision is made for an appeal to this Court “involving any question as to its jurisdiction or any question of law” (s. 21(12)). [ 10 ] Thus, given the exclusive jurisdiction of both the Commission and, consequently, the Appeals Tribunal, it is trite law that this Court must, therefore, accord a high degree of deference to their decisions. [ 11 ] This case does not solely involve the

interpretation of legislation where the standard of review would be

correctness, as was the case in Gauthier v. New Brunswick (Workplace Health, Safety and Compensation Commission) (2003), 259 N.B.R. (2d) 176, [2003] N.B.J. No. 139 (QL), 2003 NBCA 25 . Rather, it involves a situation where the Appeals Tribunal was called upon to assess the factual components that make up Mr. Farquhar’s “pre-accident earnings”, and therefore the case raises a question of mixed fact and law. Accordingly, we owe deference to the decision of the Appeals Tribunal on the review standard of reasonableness (see The City of Saint John v.

The Workplace Health, Safety and Compensation Commission of New Brunswick and Rowe (2008), 338 N.B.R. (2d) 213, [2008] N.B.J. 440 (QL), 2008 NBCA 83 at para. 4 ). [ 12 ] Mr. Farquhar has the onus of satisfying us, not that his claim of inclusion is reasonable, but rather, that the decision of the Appeals Tribunal upholding the Commission’s exclusion decision is unreasonable. [ 13 ] The benefits that Mr. Farquhar seeks to include as “pre-accident” earnings are, he claims, provided for in a Collective Agreement between his Bargaining Agent and his Employer and thus form part of his regular remuneration.

Article 16 concerns Health and Welfare while

Article 17 deals with the Registered Retirement Plan. In the case of the former, the employer remits the full cost to fund an existing insurance coverage by a carrier it chooses. The Weekly Indemnity and Long Term Disability Plan is “based on sixty six and two thirds (66 2/3) of a forty (40) hour work week, at the applicable hourly rate, for full time employees”. A pro- rated benefit is provided for part time employees.

Enrollment in the Plan is mandatory for each eligible employee member of the bargaining unit who has completed their probationary period, worked or been compensated by the employer for at least forty-eight (48) hours in the prior month and is a “regular full-time and/or part-time bargaining unit employee”. The employer agrees to continue “to make the necessary contributions for an employee who is incapable of working because of sickness or industrial or non-industrial accident for a period not to exceed nine (9) consecutive months”.

In addition, an employee has an option to pay the premium amount to the employer and extend coverage beyond the nine (9) month period, “as long as he remains an employee of the company”. In other words, at the time of Mr. Farquhar’s work-related injury he did not lose his health and welfare benefits. [ 14 ] Under the Registered Retirement Plan, the employer agrees to make monthly payments to a named Canadian Chartered Bank at a specified location in Moncton, N.B., on behalf of each eligible employee. Eligibility requirements are the same as for the Health and Welfare Plan.

The monthly payments were equal to $260.00 in 2007, $270.00 in 2008 and $280.00 in 2009. These amounts are not determined by reference to an individual employee’s earnings. The bank maintains a separate account for each eligible employee. Each employee is required to “maintain their accounts and not make withdrawals from their RRSP as a condition of continued employment”. In addition, the employer agrees to continue making RRSP contributions to an employee who was incapable of working “for a period not to exceed six (6) consecutive months”.

While those contributions were taxable, the employee is not taxed because the employer’s contributions are eligible for an off-setting deduction in each employee’s annual income tax return. Thus, the only way an employee could access the funds in his or her RRSP account is when their employment with the employer is terminated either through dismissal, resignation or retirement. It was not a specified condition of Mr. Farquhar’s RRSP plan that his employer’s contributions were available to him “prior to age 65”. [ 15 ] Like his health and welfare plan, Mr.

Farquhar did not lose his employer’s contribution to his RRSP at the time of his injury. [ 16 ] As noted earlier, Mr. Farquhar relies on the Commission’s Policy 21-200: Determination of Loss of Earnings, which became effective June 21, 2001 and was applicable at the time of his May 6, 2007 injury. Policy 21-200 was replaced by Policy 21-210: Calculation of Benefits, on August 30, 2007. Neither Policy specifically directs that the benefits at issue in this case are to be included or excluded from a “worker’s regular remuneration that forms a consistent earning pattern”.

The Appeals Tribunal noted that the benefits provided for under Articles 16 and 17 of the Collective Agreement are paid to third parties and are separate from

Article 8 which provides for the “Classification, Rates of [P]ay and Special Allowances” paid to Mr. Farquhar and are matters that pertain to “remuneration that forms a consistent earning pattern”. Commission Policies may be of assistance to the Commission and injured workers when determining benefit entitlement.

Such policies do not, however, abrogate the Commission’s exclusive jurisdiction to make decisions under the legislation, such as what components are to be included when calculating an injured worker’s loss of earnings benefits. [ 17 ] The Appeals Tribunal did not act unreasonably when it upheld the Commission’s decision to exclude from Mr. Farquhar’s pre-accident earnings the non-cash benefits provided for him under the RRSP and health and welfare plan in his Collective Agreement. He suffered no loss under those plans by reason of his injury.

The benefits under those plans were not remuneration “that best represents his earnings”. The benefits were neither based on earnings for work done nor actual losses of earnings suffered by Mr. Farquhar at the time of his worker’s compensation compensable injury. Hence, it was reasonable for the Appeals Tribunal to find they do not qualify as “payments by an employer(

s) made to or on behalf of injured workers, [...]” for the purpose of calculating lost pre-accident earnings.

[ 18 ] Accordingly, since the Appeals Tribunal made no reviewable error, we would dismiss the appeal and award the respondent costs of $2,500.00. ____________________________________ WALLACE S. TURNBULL, J.A. ___________________________________ J.C. MARC RICHARD, J.A. ___________________________________ KATHLEEN A. QUIGG, J.A.