Territory had different ways of calculating income for seasonal workers from permanent workers
A seasonal worker is entitled to have employment insurance (EI) benefits from another province calculated as part of his workers’ compensation benefits, the Northwest Territories Court of Appeal has ruled.
Philip Mercer was from Newfoundland and Labrador but worked in the Northwest Territories as a transport truck driver for six months each year. When his seasonal work was done each year, he returned to his home province. If he couldn’t find additional work at home, he collected EI benefits.
On Feb. 18, 2001, Mercer broke his hip while on the job in the Northwest Territories and required surgery. He successfully applied for total temporary disability benefits from the Northwest Territories workers’ compensation board (WCB).
Under the Northwest Territories Workers’ Compensation Act, an injured worker’s total disability benefit is calculated on the basis of “gross annual remuneration” — an estimate of what the worker would have earned in the year the accident occurred, had it not occurred. However, there were different methods for making this calculation.
The WCB’s standard for calculating the benefit entitlement of seasonal workers was to take their actual remuneration for the year before the work-related accident and injury. This calculation only included actual compensation from work and not EI benefits received. For permanent workers, “gross annual remuneration” was estimated based on the salary the worker was earning at the time of the accident.
Since the amount of EI Mercer received in Newfoundland and Labrador wasn’t included in the calculation of his benefits, the amount he received was about $265 less every week than what he would have received with the EI included.
The Northwest Territories differs than most other Canadian jurisdictions in that workers who want to contest the amount of workers’ compensation benefits can pursue other avenues outside the workers’ compensation appeals system. As a result, Mercer filed a complaint with the territorial human rights commission, claiming the WCB discriminated against him on the basis of his social condition — a prohibited ground under the Northwest Territories Human Rights Act — by differentiating between seasonal workers and permanent workers when determining the benefits they receive.
Mercer also filed an appeal with the WCB appeals commission, which granted him benefits based on his total remuneration including EI benefits. However, this was specified as a “one-time only” basis, so the human rights complaint was continued so the WCB could receive guidance on how to handle seasonal workers’ benefits calculations in the future.
The adjudicator found Mercer was part of a group “composed of seasonal workers who live in areas of high unemployment; are required to work away from home, and often outside their home province; they earn less than the national and provincial average salaries; and they have lower education levels with fewer job opportunities.”
The WCB’s policy of excluding EI benefits as part of the gross annual remuneration of seasonal workers was discrimination on the ground of social condition, said the adjudicator. The WCB appealed the decision to the Northwest Territories Supreme Court. The court upheld the decision, finding eligibility criteria for government benefit programs needed to have lines drawn, but those lines could not discriminate against a worker on the basis of a prohibited ground.
The WCB appealed again, this time to the Northwest Territories Court of Appeal, arguing the workers’ compensation scheme was based on work and funded by workers’ contributions. EI benefits didn’t contribute to workers’ compensation funds and therefore shouldn’t count towards benefits, said the WCB.
The appeal court found EI benefits are designed to replace work income and workers must meet minimums for paid employment to qualify; therefore, EI benefits “are thus very much employment-related earnings,” said the Court of Appeal.
The appeal court pointed out that a permanent worker who had received EI benefits in the year before an injury would not be penalized in the calculation for gross annual remuneration because only her salary would be used.
“This starkly illustrates the discriminatory impact of the WCB policy, which bases a seasonal worker’s entitlement on his or her income during the year before the injury but excludes any EI benefits received during that time period,” said the appeal court.
