- Executive officers
- Loss of earnings {LOE} (employability)
- Earnings basis (self-employment)
- Loss of earnings {LOE} (self-employment)
In Decision No. 523/23R, the Vice-Chair granted the WSIB's reconsideration request of Decision No. 523/23. This decision contained a fundamental error of law as it awarded full LOE benefits to the worker without providing reasons for why the dividends reported by the worker on his income tax returns should not be considered as actual employment earnings for the purpose of LOE quantum calculation. The worker was an independent operator of his electrical contracting firm who claimed dividends as part of his net business income. He was also an executive officer of his business.
The sole issue raised on reconsideration by the WSIB was the quantum of the worker's LOE benefits from October 31, 2015, to age 65, separated into three time periods. The WSIB submitted that both section 43 of the WSIA and the applicable WSIB policy, OPM Document No. 18-02-08, "Determining Average Earnings-Exceptional Cases", when read together, indicated that the worker's dividend income be treated as actual employment earnings for the purposes of calculating the quantum of LOE benefits payable. The WSIB further submitted that, although the applicable policy refers to pre-injury income, by analogy, the same reasoning would apply for the treatment of dividend income realized as post-injury earnings (see Decision No. 1597/10).The Vice-Chair allowed the appeal, in part. The worker was entitled to partial LOE benefits for two portions of the relevant period, the first being October 15, 2015 to January 1, 2017, and the third being January 2, 2018 to age 65. The dividends which the worker included in his income tax returns in these two periods were to be included as employment earnings in the calculation of his business income for the purposes of determining the quantum of his partial LOE benefits. The worker was entitled to full LOE benefits in the second portion of the relevant time period, from January 1, 2017 to January 1, 2018, as the worker did not claim any dividends as employment earnings in the 2017 taxation year. The Vice-Chair explained that the inclusion of items, such as dividends, in the calculation of net business income to determine average employment earnings, has been approved in various Tribunal decisions. The decisions which address post-injury income indicate that dividends be treated the same way when they are post-injury income as they are treated when they are pre-injury earnings. In the Vice-Chair's view, it was a reasonable and balanced approach to conclude that, where dividend income is included for the purposes of calculating the pre-accident average earnings, it should also be considered income post-injury, if post-injury dividends are received.