Calculating Loss of Earnings Benefits

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What an injured worker could get paid, if the claim is allowed
Workers with injury/disease dates after January 1, 1998 who are absent from work because of their work-related injury/disease will receive loss of earnings (LOE) benefits equivalent to 85% of their pre-injury net average earnings (NAE). Workers with injury/disease dates prior to January 1, 1998 receive 90% of their NAE. LOE benefits may include both a short-term and a long-term benefit rate depending on how long the worker is off work.

The worker’s LOE benefits can be adjusted any time prior to the final 72-month benefit review as a result of any material change in circumstances, or for a failure to report any material change that takes place after January 1, 1998.

a) Short-term benefit rate
Short-term average earnings include the worker’s earnings from the injury employer and all other employment (“concurrent employment”) at the time the worker was injured. Short-term average earnings are used to pay LOE benefits for the first 12 weeks after the injury. Some of the types of earnings included in the calculation of regular short-term earnings are

  • the base rate of pay with the injury employer (hourly, daily or weekly)
  • gratuities and tips included as gross earnings for income tax
  • shift differentials
  • vacation pay that is calculated as a percentage of the base rate and paid regularly on pay checks
  • mandatory overtime
  • regular voluntary overtime
  • regular production bonuses and commissions, and
  • room and board if they are part of the worker’s pay.

b) Long-term benefit rate
The long-term rate is paid from the start of the 13th week following the injury and is based on the worker’s earnings pattern generally 12 months prior to the accident date or less if there was a break in the worker’s employment pattern.

Operational Policy Manual (OPM) Doc. No. 18-02-02, “Determining Short-term Average Earnings,” includes a table outlining the types of earnings that are included in the short-term and long-term earnings basis calculation.

Other groups of workers to which different rules apply
There is a separate Workplace Safety and Insurance Board (WSIB) policy that outlines the procedure for calculating short- and long-term average earnings for dependent contractors, workers who have optional insurance, apprentices, learners, students, pupils enrolled in a Ministry of Education program, members of a volunteer force, emergency workers, and individuals participating in the Ontario Works program.

Ensure the worker is receiving the appropriate amount of LOE benefits
Since the WSIB assumes the worker’s short-term and long-term average earnings are the same, it usually does not automatically recalculate average earnings. You may need to ask the Case Manager for a recalculation if the short-term average earnings do not reflect the long-term average earnings.

Either the employer or the worker can request a recalculation of LOE benefits. If a recalculation results in a lower rate, a benefit-related debt is created and the worker may have to pay that amount back to the WSIB.

All benefits are subject to the worker’s cooperation. You should contact the decision-maker if you have reason to believe the worker is not fulfilling his/her obligation to cooperate in the work reintegration (WR) process.

Other groups of worker to which different rules apply
There is a separate WSIB policy that outlines the procedure for calculating short- and long-term average earnings for dependent contractors, workers who have optional insurance, apprentices, learners, students, pupils enrolled in a Ministry of Education program, members of a volunteer force, emergency workers, and individuals participating in the Ontario Works program.

When LOE benefits are discontinued
LOE payments continue until the earliest of one of the following situations occurs:

  • the worker no longer suffers a wage loss as a result of the injury or
  • the worker is no longer impaired as a result of the injury or
  • the worker turns age 65, provided the worker was less than 63 years of age at the time of the injury, or
  • two years after the date of the injury, if the worker was 63 years old or older on the date of the injury.

Non-economic loss (NEL) benefits
The worker may also be entitled to a NEL benefit if the work-related injury/disease results in a permanent impairment. The WSIB defines a “permanent impairment” as any permanent physical or functional abnormality or loss resulting from a work-related injury/disease, as well as any psychological damage arising from that abnormality or loss. Schedule 1 employers can apply for Second Injury and Enhancement Fund (SIEF) relief if the worker had a prior injury or pre-existing condition that contributed to the worker’s permanent impairment.