Highlights of Noteworthy Decisions

Decision 2210 13
16/12/2013
L. Petrykowski
  • Deductions (severance pay)
  • Loss of earnings {LOE} (termination of employment)

The worker suffered an elbow injury in 2007, for which he was granted a 19% NEL award. He was permanently laid off by his employer in March 2009, due to plant closure. He received severance pay and 16 weeks of pay in lieu of notice. The Board did not consider the severance pay to be earnings but did consider the 16 weeks pay in lieu of notice to be earnings. The Board deducted the amount of the 16 weeks pay from the worker's LOE benefits. The worker appealed.

The worker had been working for the employer since 1993. Pursuant to the Employment Standards Act, the worker was entitled to eight weeks pay in lieu of notice (also known as termination pay or statutory notice).
The Vice-Chair referred to Decisions No. 302/11 and 748/13, and concluded that those decisions were compelling in support of the position that pay in lieu of notice made under the Employment Standards Act is not considered earnings for the purpose of LOE benefits following termination of employment. Therefore, the statutory eight weeks of pay in lieu of notice should not be considered as earnings and should not be deducted from the worker's LOE benefits. However, the other eight weeks of notice was part of a negotiated agreement relating to the closure of the plant and should be considered as earnings. The worker's LOE benefits should be offset by the amount of pay in lieu of notice that was not paid pursuant to the Employment Standards Act.
The appeal was allowed in part.