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*Complimentary Issue*

[Special Edition] Special Edition – August 24, 2021

In this IRB quantum edition, we review three cases that consider the following questions:

1. Is the insurer entitled to deduct EI Maternity and unclaimed employer top-up benefits?

2. Does IRB quantum factor into eligibility consideration?

EI Maternity & Unclaimed Employer Top-up Benefits Deductible

Childbirth Not an Impairment – In Manuel v Certas (19-008341), with the Respondent having conceded IRB entitlement, the dispute centred around whether they were entitled to deduct EI maternity benefits and employer top-up benefits from any amount of the payable IRB. Manuel had gone on maternity leave shortly after the accident, and while she was eligible for a “top up” benefit from her employer, she did not apply for same.

The parties disagreed as to the characterization of the maternity benefits. The Respondent contended they are to be considered as “gross employment income”, therefore they were allowed to deduct 70% of same from the IRB quantum. Manuel contended they were in fact “temporary disability benefit” or “other income replacement assistance”, hence were not deductible, with the exclusion in the Schedule regarding EI benefit deductibility.

The Tribunal concluded that for Manuel’s interpretation to be accepted would require a finding that “EI for childrearing is a temporary disability benefit paid because childrearing is an impairment.” The Tribunal also found “compelling” an earlier Tribunal decision S.W. v Certas (17-005302), wherein EI Maternity benefits fell within the definition of “gross employment income”.

Concerning the employer “top up” benefits available, the Tribunal confirmed that Manuel was obligated to apply for same before relying on the benefits available to her through the Respondent “because the insurer is the payor of last resort.” Therefore, the failure to apply “does not preclude [the Respondent] from deducting as though she was in receipt of the benefit.”

Does $0 Quantum Factor into IRB Eligibility?

Employed – Yes and No – While “employed” is not specifically defined in the Schedule, the Tribunal in T.M. v Aviva (18-010477), found that the term is used in two senses, one of “being in an employment relationship”, the second requiring “a need to be remunerated as remuneration is the basis for calculating entitlement.” T.M., on an unpaid leave for approximately nine months on the date of loss, satisfied the first criterion of “being in an employment relationship”, however failed on the second where he received no remuneration. As there was no employment income with which to calculate entitlement to IRB, T.M. was paid IRBs in error.

The Tribunal noted that the Schedule was “silent on what constitutes a person being employed, thereby leaving the meaning open to interpretation.” Referencing T.M.’s status at the time of the accident, the Tribunal found that the Schedule does not require the Applicant to be “working” in 26 of the previous 52 weeks, rather required that they be “employed”. However, “a part of being employed, pursuant to the requirements under s. 7, is receiving weekly employment income. This is where [the Applicant]’s claim falls short.” To find otherwise, would result in an “absurd result”, of being employed yet entitled to $0 IRB. Given that T.M. was considered not “employed”, the Tribunal did not need to address the “substantial inability” test.

Entitled to $0 – In J.G. v Co-operators (18-012430), the Tribunal found that J.G. was statute barred from proceeding with her application for NEB as she failed to dispute the denial within the limitation period which was triggered by a valid denial. Following receipt of an OCF-3 that J.G. suffered from a complete inability to carry on a normal life, the Respondent in their EOB noted that she was not eligible for NEB because she was self-employed. At the time, she was attempting to start a horse farm on her property, and the Respondent had advised that she was “eligible for an IRB but entitled to zero dollars”.

J.G. argued that she had not applied for NEB at the time of denial as she had not made an election. The Tribunal however noted, “An OCF-10 is not required to complete an application. An application for benefits is complete when an OCF-1 and OCF-3 are submitted and the relevant boxes are checked.” Concluding that there was in fact no election to be had, the Respondent’s denial was valid given that “[the Applicant] was self-employed and indicated she was self-employed, she qualified for an IRB, which, by the language of the Schedule, meant that she was not eligible for a NEB.”

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