Neutral Citation: 1994 ONICDRG 77
File No. A-004698
ONTARIO INSURANCE COMMISSION
BETWEEN:
YEN V. NGUYEN
Applicant
and
PROGRESSIVE CASUALTY INSURANCE COMPANY
Insurer
DECISION
Issues:
The Applicant, Yen V. Nguyen, was injured in a motor vehicle accident on December 11, 1992. He received weekly income benefits from Progressive Casualty Insurance Company (Progressive), payable under Ontario Regulation 6721. These benefits were terminated on February 17, 1993.
The issues in this hearing are:
Is Mr. Nguyen entitled to continued weekly income benefits under s. 12 of the Schedule for the period from February 17, 1993 to July 17, 1993, when he returned to work?
What is the amount of Mr. Nguyen's weekly benefit? Specifically, in calculating the amount of Mr. Nguyen's weekly income benefits, how is vacation pay that he received to be allocated?
Is Mr. Nguyen entitled to a lump sum award under s. 282(10) of the Insurance Act, on the basis that Progressive unreasonably withheld or delayed payments?
Mr. Nguyen also claims interest on any outstanding amounts owing, and his expenses incurred in the hearing.
Result:
Mr. Nguyen is entitled to weekly income benefits under s. 12 of the Schedule from February 17, 1993 to June 3, 1993.
The amount of Mr. Nguyen's gross weekly income for the four weeks before the accident (including vacation pay accrued in the four weeks) is $564.46. He is therefore entitled to a weekly benefit of $451.57.
Mr. Nguyen is not entitled to a special award under s. 282(10) of the Insurance Act.
Mr. Nguyen is entitled to his expenses of the arbitration proceeding, and to interest on the money found to be owing.
Hearing:
The hearing was held in North York, Ontario, on November 25, 1993, and December 16, 1993, before me, Susan Naylor, Senior Arbitrator.
Present at the hearing:
The Applicant:
Mr. Yen Van Nguyen
The Applicant's representative
Michael Gillen Barrister & Solicitor
The Insurer's representative
Ted Bergeron Barrister & Solicitor
For the Insurer
Carmen Mounsey
Claims Representative
Three witnesses gave oral testimony at the hearing. They were:
The Applicant
Dr. Rick Ramroopsingh, M.D.
Dr. Stanley Sober, M.B., B.S., F.R.C.S.(C)
Seven exhibits were filed. They are listed in Appendix A. The statutes and authorities referred to by the parties and in this decision are listed in Appendix B.
Evidence and Findings:
Mr. Nguyen speaks very little English; he gave his testimony through an interpreter.
Mr. Nguyen's employment
Mr. Nguyen had worked for about eighteen months for Leon Fence Co. Ltd. before the accident on December 11, 1992. The company made and installed wooden and steel fences. The work was seasonal - a number of employees were hired for the summer and fall but laid-off over the winter. Mr. Nguyen was one of these workers.
According to company records, Mr. Nguyen and other seasonal employees were laid-off for the 1992/93 winter as of the week after the accident. They were not due to be recalled until the beginning of May. When the time came, the recall was delayed until later on in the spring due to poor economic conditions. Therefore, for most of the period in issue, no work was available for Mr. Nguyen, even if he had been fit enough to do it.
Mr. Nguyen's job involved putting together the fence sections in the plant and helping to install the finished product on the customer's premises. He estimated that about 60 per cent of his time was spent in the plant, where he made both cedar wood fences and steel fences. The wooden fences were built in 8 by 4 or 8 by 6 feet sections in the plant. The wood was brought to Mr. Nguyen's work station in the plant by forklift truck, and stacked in 4 foot piles. Mr. Nguyen lifted the individual pieces of wood and placed them on a custom frame on a long table. He used a pressurised nail gun and hammer to complete the section. Then, he and a co-worker lifted it down from the table. He was expected to complete about 15 sections a day.
The steel fencing was made in a similar way, using a welding machine.
Mr. Nguyen testified that the sections were heavy, although he could not estimate their weight exactly. He had to turn them over to work on them. He used a machine to cut pickets for the fences. The work was quite physically demanding, and required considerable bending and lifting.
Forty per cent of Mr. Nguyen's time at work was involved in erecting the wooden fences for customers. Mr. Nguyen testified that this was also physically demanding work which generally took a three-man crew to complete. One of the crew, (not Mr. Nguyen) operated a digger, to dig the trench for the posts. Mr. Nguyen helped position the drill and cleared residual earth with a shovel. The crew loaded the fence sections onto a truck, and drove them to the site, where they were installed in cement.
Mr. Nguyen testified that the outside work was not done in winter when there was snow on the ground, and I infer from this that Mr. Nguyen probably was not doing this work in the period immediately before the accident.
Mr. Nguyen's medical condition
Mr. Nguyen's pre-accident medical history was unremarkable. The notes of his family doctor, Dr. Duong Xuan Bui, showed some episodes of back pain in early 1989, apparently from a prior accident, and a single report of pain in early 1991. However, I do not find these prior complaints to have significance, as they were apparently resolved well before this accident.
Mr. Nguyen suffered a whiplash injury in the car collision on December 11, 1992. He testified that he hit his chest against the steering wheel and his head against the dashboard of his car. He did not seek immediate medical attention. He went home, and applied some Chinese herbal ointment on his body.
Mr. Nguyen testified that he was supposed to go to work after the week-end, but called in sick. It seems however that he was mistaken in this, as he had been temporarily laid-off by that time. Mr. Nguyen went to see Dr. "Rick" (subsequently identified as Dr. Rick R. Ramroopsingh) at the end of the week, (on December 18, 1992). According to Mr. Nguyen, he went to see Dr. Ramroopsingh rather than his own family doctor, because Dr. Ramroopsingh's office was closer to his home, and more convenient to get to.
Dr. Ramroopsingh testified at the hearing. His records indicate that Mr. Nguyen complained of headaches, neck and lower back pain and chest pain. His worst complaint was severe back pain and stiffness. Dr. Ramroopsingh examined Mr. Nguyen, and found tenderness and muscle spasms in the neck and shoulder muscles, and pain and moderate to severe restricted range of movement in the lower back.
Dr. Ramroopsingh prescribed medication, sent Mr. Nguyen for a number of investigative tests, and referred him for physiotherapy. He saw Mr. Nguyen roughly once a month, on December 23, 1992, January 7, 1993, February 4, 1993, March 4, 1993, April 14, 1993, May 12, 1993 and June 2, 1993. He last saw him in July or August, 1993, after Mr. Nguyen had returned to work.
According to Dr. Ramroopsingh's evidence, Mr. Nguyen continued to complain of headaches, and persistent but variable neck and back pain, and to demonstrate restricted range of motion in these areas. His chest pain resolved.
Dr. Ramroopsingh reported that Mr. Nguyen's back pain was aggravated with bending, lifting, prolonged sitting or standing, and damp or cool weather. Dr. Ramroopsingh understood Mr. Nguyen's job to be physically demanding construction labour, and felt that his patient could not do such a job in his condition.
Unfortunately, other than on the first occasion, Dr. Ramroopsingh's clinical notes of the visits provide few details of his findings and, for this reason, are not very helpful.
Mr. Nguyen was examined by Dr. Stanley Sober, an orthopaedic specialist, at the request of Progressive on February 17, 1993. His report is marked Exhibit 1, Tab 13. Dr. Sober also testified at the hearing. An interpreter was present during the examination.
According to Dr. Sober, Mr. Nguyen reported significant improvement in his condition since the accident, but still complained of intermittent headaches and continuing low back discomfort, especially with bending and lifting. Mr. Nguyen's neck did not bother him significantly, but he noted some occasional discomfort when he moved it a lot.
Dr. Sober noted full, pain-free range of motion in Mr. Nguyen's neck and shoulder, and normal range of motion in the back, with the exception of some back discomfort on hyper-extension and tenderness in the lower lumbar spine. Mr. Nguyen could touch his toes. Dr. Sober found "minimal evidence of any disability". He indicated in his report that Mr. Nguyen was able to return to work "without further delay", and, based on this, benefits were terminated.
Dr. Sober understood from Mr. Nguyen that Mr. Nguyen's work was "relatively light work" involving cleaning up construction garbage, and his opinion was based on this assumption. It appears, however, from the evidence that Mr. Nguyen's job was a good deal more physically demanding than Dr. Sober was led to believe.
I am persuaded that, through what may have been language difficulties, Dr. Sober was not fully apprised of the physical demands of Mr. Nguyen's job.
I also accept that Mr. Nguyen's back pain varied from day to day, and was relieved with physiotherapy treatment. I note that Mr. Nguyen had received physiotherapy treatment shortly before he saw Dr. Sober, and this may account, in part, for the fact that he demonstrated little discomfort when he saw Dr. Sober later on that day.
Moreover, there was some confusion about the timing of when, in Dr. Sober's view, Mr. Nguyen could return to work. Dr. Sober testified that when he recommended that Mr. Nguyen should return to work without further delay, he did not mean immediately the very next day, but within a couple of weeks. He assumed that some such time delay was built into the process for terminating benefits. In a subsequent letter dated June 30, 1993, (Exhibit 4), he referred to the Applicant being able to return to work in March 1993.
I am prepared to accept that Mr. Nguyen was not fit to return to his job at the time benefits were terminated and for some period thereafter. However, it seems from Mr. Nguyen's own report and Dr. Sober's findings that Mr. Nguyen was getting much better.
On April 14, 1993, Dr. Ramroopsingh provided another Form 4 medical report to Progressive, (Exhibit 1, Tab 7). The report noted complaints of headaches, neck pain, back pain and sleep disturbances. Dr. Ramroopsingh found tenderness and reduced range of motion in the neck and back. The report was provided to Dr. Sober, who commented that he would be "surprised" if the symptoms reported were severe enough to disable Mr. Nguyen from work (Exhibit 1, Tab 14).
Mr. Nguyen attended physiotherapy three times a week until May 25, 1993. The records show a gradual and progressive improvement in his condition. He was placed on a regime of home exercises to improve his conditioning so that he could go back to work. He testified that he noted an improvement after about two weeks of his discharge. The physiotherapist, Jerzy Luczkiewicz, reported that, as of the date of discharge, Mr. Nguyen was still complaining of some neck and back pain, but was not restricted in movement. In a letter dated June 4, 1993, (Exhibit 1, Tab 11), Mr. Luczkiewicz concluded that Mr. Nguyen might have occasional pain for sometime but could resume his normal life. This was consistent with Mr. Nguyen's own testimony that he felt better.
Mr. Nguyen saw Dr. Ramroopsingh on June 2, 1993. Dr. Ramroopsingh noted continued improvement but his prognosis was a good deal more cautious than that suggested by Mr. Nguyen's own testimony, or the views of the physiotherapist. He felt that Mr. Nguyen would be able to return to light duties on a trial basis "in the upcoming months". (Report, June 11, 1993, Exhibit 1, Tab 9).
Dr. Ramroopsingh explained that, after a prolonged period of inactivity through disability, a gradual phased return to work restores an injured person to full employment capacity more quickly in the long run than premature re-employment which can result in re-injury. Dr. Ramroopsingh did not feel secure recommending a return to full-time work in early June. He understood that no part-time work was available and therefore adopted a cautious approach in allowing for a greater margin of time for recovery. While this concern is understandable, it is not clear to me that such a cautious approach was warranted in this case.
The weight of the evidence indicates consistent improvement in Mr. Nguyen's condition. The physiotherapist felt that Mr. Nguyen was ready to resume his normal activities after his discharge from the program. Mr. Nguyen himself acknowledged feeling better after physiotherapy and two weeks' exercises and, it appears, may have made a move to return to some work earlier on. A letter from his employer dated December 2, 1993, was filed. It suggests that Mr. Nguyen reported back to work on April 30, 1993 expecting to be recalled at that time, but was advised that no work was available for him.
It is difficult to know what to make of the contents of the letter because it was not put directly to Mr. Nguyen at the hearing, and no one from the company testified. Mr. Nguyen testified that he telephoned the company about modified work twice, but was uncertain as to the date or other details. The letter from the company stated that he had not requested modified or lighter work at any time.
Although I am unclear about exactly what transpired and when, I am able to conclude, at least, that Mr. Nguyen's condition was progressively improving. Based on the physiotherapist's report, I am prepared to find that Mr. Nguyen was not fit to return to his work before the completion of therapy. However, the weight of the evidence suggests that he was fit for full-time work by June 4, 1993.
There are some unresolved and troubling aspects to this case, especially in regards to the lay-off. Mr. Nguyen did not recall being laid-off by his company. There were discrepancies between his testimony about his contact with the company and the evidence from the company. Overall, his testimony about his employment situation and his dealings with the company was vague and incomplete.
However, while I have some concerns that Mr. Nguyen was not totally forthcoming about his employment situation, I generally accept his description of his job duties and the effect of the accident upon his ability to perform them.
I note that none of the health professionals who saw Mr. Nguyen questioned his motivation to return to work. The physiotherapist, in particular, noted him to be "co-operative and motivated" (Exhibit 1, Tab 11). I accept their conclusions in this regard.
Based on the evidence before me, I find that Mr. Nguyen was substantially unable to return to the essential tasks of his employment from the date benefits were terminated until June 3, 1993.
The amount of benefits
The amount of weekly benefits is based on 80 per cent of an applicant's gross weekly income from employment, to a maximum of $600. Section s. 12(7) 1 of the Schedule sets out how Mr. Nguyen's gross income is to be calculated. It states:
PART IV
WEEKLY BENEFITS
INCOME BENEFIT
(7) The following rules apply to the calculation of gross weekly income:
- A person's gross weekly income shall be deemed to be the greatest of,
i. his or her average gross weekly income from his or her occupation or employment for the four weeks preceding the accident,
ii. his or her average gross weekly income from his or her occupation or employment for the fifty-two weeks preceding the accident,
iii. $232.
Mr. Nguyen's benefits were based on his wages in the four weeks before the accident, under s. 12(7) 1 .i of the Schedule, because that was most favourable to him.
Mr. Nguyen also received $838.08 representing one year's accrued vacation pay at 4% of his annual earnings under the Employment Standards Act. He was given the money on November 27, 1992, within the four weeks before the accident. According to information provided by the company, (Exhibit 7), vacation pay was paid at the end of November each year for the year running from the prior December 1 to the end of November. A further amount of $44.98, representing vacation pay on Mr. Nguyen's earnings in December 1992 was not paid.
The parties disagree about how this vacation pay is to be allocated.
If the vacation pay is excluded altogether from the calculation of Mr. Nguyen's gross weekly income, his average gross weekly income for the period would be $542.75, representing a benefit rate of $434.20.
If vacation pay accruing in the four weeks before the accident is included, Mr. Nguyen's average gross income would be $564.46, for a benefit rate of $451.57.
However, if the entire amount he received for vacation pay is included in the calculation of his income for the four weeks before the accident, his gross average income would rise to $752.27, for a maximum benefit rate of $600 a week.
The provisions governing vacation pay are set out in Part VIII of the Employment Standards Act, R.S.O. 1990, Chap E.14, entitled "vacation with pay". It states:
PART VIII
VACATION WITH PAY
28.- (1) Every employer shall give to each employee a vacation with pay of at least two weeks upon the completion of each twelve months of employment.
(2) The amount of pay for such vacation shall be not less than an amount equal to 4% of the wages of the employee in the twelve months of employment for which the vacation is given and in calculating wages no account shall be taken of any vacation pay previously paid. R.S.O. 1980, C. 137, s. 29.
29.- (1) The employer shall determine the period when an employee may take the vacation to which he or she is entitled under section 28, which may be a two week period or two periods of one week each, but in any case the employee shall be given his or her vacation not later than ten months after the end of the twelve-month period for which the vacation was given.
(2) Despite subsection (1) and subsection 7 (3), the Director may require an employer to pay to an employee at any time the vacation pay to which the employee is entitled under section 28.
(3) Subsection (2) applies even if there is a strike or lock-out as a result of a labour dispute. R.S.O. 1980, C. 137, s. 30.
- Where the employment of an employee ceases before the completion of a twelve month period of employment or the employee has not been given a vacation with pay under section 28, the employer shall pay to the employee an amount equal to 4 per cent of the wages of the employee in any twelve-month period or periods or part thereof and in calculating wages no account shall be taken of any vacation pay previously paid. R.S.O. 1980, c. 137, s. 31.
Basically, these sections confer a statutory right on employees to at least two weeks vacation, with pay, on completion of every twelve months employment. An employee who has not been given vacation with pay is entitled to vacation pay on wages earned in the twelve months. An employee who is terminated is entitled to accrued vacation pay straight away.
Counsel for the Insurer submitted that vacation pay is not income from employment because it is payable for vacation time, where no work is done in return by the employee. I do not accept this argument. Vacation pay has been paid to the Applicant as part of the monetary remuneration to which he is entitled as an employee. As such, it represents income from employment under s. 12(7) of the Schedule.
I must determine how the vacation pay is to be allocated. Arbitrators have adopted a variety of approaches in determining how payments should be allocated. There is no generally established method of attribution. It is very much fact-based - what best meets the objective of the Act in reflecting the applicant's earnings for the periods of time set out in the Schedule.
In some circumstances, payments have been attributed to the period when payment was received, or the applicant became entitled to receive it. (eg.in M.P. and The Dominion of Canada General Insurance Company, Ontario Insurance Commission File No. A-001478, issued on May 21, 1993, in which the real estate commission was allocated as of the date of closing, because the deal could have fallen through before then.)
In this case, however, although the Applicant only received his statutory vacation pay in November, the vacation pay accrued on the wages he earned over the prior twelve months:
Vacation pay accrues to each employee as his basic wages are earned. For example, if he is paid hourly, his vacation pay accrues as a percentage of his hourly pay for each hour worked. In addition, the Act provides that vacation pay is to be calculated on wages, which includes any payment to be made under the Act.
(Employment Standards Handbook, 2.ed. Robert M. Parry, referring to Domtar Chemicals Ltd (Re), August 17, 1973, (Fram) E.S.C. 44 (Order no. 093/085/077 - 7pp.)
The Applicant and his employer had an ongoing employment relationship, in which vacation pay accrued. Mr. Nguyen in fact received a payment for accrued vacation pay in the four weeks before the accident. The only issue is how the money Mr. Nguyen received should be allocated. On the facts of this case, it better reflects the reality of Mr. Nguyen's earnings profile to allocate the money at the rate that it accrues, than to attribute it exclusively to the four weeks when it was paid.
Accordingly, I find that Mr. Nguyen's gross weekly income for the four weeks before the accident (including vacation pay accrued in the four weeks), is $564.46. He is therefore entitled to a weekly benefit of $451.57.
Special award
Mr. Nguyen claimed a special award under s. 282(10) of the Insurance Act. This section states:
282.-(10) If the arbitrator finds that an insurer has unreasonably withheld or delayed payments, the arbitrator, in addition to awarding the benefits and interest to which an insured person is entitled under the No-Fault Benefits Schedule, shall award a lump sum of up to 50 per cent of the amount to which the person was entitled at the time of the award together with interest on all amounts then owing to the insured (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule.
In Wayne Allen Plowright and Wellington Insurance Company, Ontario Insurance Commission File No. A-003985, issued on October 29, 1993, Arbitrator Palmer described "unreasonable" conduct as behaviour which was "excessive, imprudent, stubborn, unyielding or immoderate". I agree with these comments.
Counsel for the Applicant submitted that Progressive's conduct towards the Applicant was adversarial and confrontational, and warranted a special award. In particular, he noted the following:
Progressive terminated benefits as soon as it received Dr. Sober's report, although Dr. Sober, himself, anticipated some delay.
Progressive received further reports from Mr. Nguyen's doctor, indicating ongoing disability, and from his physiotherapist, indicating disability until the end of therapy. Progressive did not act on these reports.
In his May report, Dr. Sober expressed uncertainty as to whether Mr. Nguyen had suffered a recurrence or exacerbation of his symptoms. Progressive did not act on this report.
In his June report, Dr. Sober indicated that Mr. Nguyen could go back to work in March, not February. Progressive did not act on this report and did not provide it to the Applicant.
Progressive's conduct in this case is far from ideal. A reasonable insurer would have provided Mr. Nguyen with advance notice of its intention to terminate benefits, as Dr. Sober assumed. It would have provided Mr. Nguyen with an opportunity to supply additional medical information before terminating benefits, and would have ensured that any medical information it received was quickly sent to the doctors (the Applicant's and the doctor it retained) for comment. That did not happen in this case.
However, in my view, the underlying decision to terminate Mr. Nguyen's benefits was not unreasonable, in light of Dr. Sober's findings. Moreover, Progressive did not close its mind to fairly considering new medical information in regards to Mr. Nguyen's condition. Dr. Sober was provided with Dr. Ramroopsingh's subsequent reports for review. Allowing for some ambiguities in the reports, the bottom line is that Dr. Sober did not change his assessment that Mr. Nguyen was able to return to work, after he reviewed these. Dr. Ramroopsingh was also provided with Dr. Sober's February report, although not as quickly as he should have been. However, Dr. Ramroopsingh's subsequent reports were brief, and did not directly address Dr. Sober's views.
In all the circumstances, I am not persuaded that Progressive unreasonably withheld benefits from Mr. Nguyen. Therefore, I do not find that Progressive is liable to pay a special award under s. 282(10) of the Insurance Act.
Expenses
Mr. Nguyen is entitled to his expenses incurred in respect to this arbitration proceeding, pursuant to s. 282(11) of the Insurance Act and Ontario Regulation 664, R.R.O. 1990. I will deal with the amount of the expenses in the event that counsel cannot agree on it.
Order:
Mr. Nguyen is entitled to weekly income benefits under s. 12 of the Schedule from February 17, 1993 to June 3, 1993.
The amount of Mr. Nguyen's gross weekly income for the four weeks before the accident (including vacation pay accrued in the four weeks), is $564.46. He is therefore entitled to a weekly benefit of $451.57.
Mr. Nguyen is not entitled to a special award under s. 282(10) of the Insurance Act.
Mr. Nguyen is entitled to his expenses of the arbitration proceeding, and to interest on the money found to be owing.
August 31, 1994
Susan Naylor Arbitrator
Date
APPENDIX A
EXHIBITS
Exhibit 1
Document Brief of the Applicant
Exhibit 2
Letter dated April 30, 1993 from Carmen Mounsey, Claims Representative, Progressive
Exhibit 3
Curriculum vitae of Dr. Stanley Sober
Exhibit 4
Letter dated June 30, 1993 from Dr. Stanley Sober to Carmen Mounsey, Claims Representative, Progressive
Exhibit 5
Clinical notes of Dr. Stanley Sober, for February 17, 1993
Exhibit 6
Facsimile dated December 2, 1993 from Edward Bergeron of Iacono Brown to Susan Naylor of the Ontario Insurance Commission
Exhibit 7
Letter dated December 2, 1993 from Alex Iannone of Leone Fence Co. to Michael Gillen of Walker, Fox, Schwarz
APPENDIX B
STATUTES AND CASES REFERRED TO
Employment Standards Act, R.S.O. 1990, Chapter E. 14
Employment Standards Handbook, 2.ed. Robert M. Parry, referring to Domtar Chemicals Ltd. (Re), August 17, 1973, (Fram) E.S.C. 44 Order no. 093/085/077 - 7pp.
Plowright v. Wellington Insurance Company, [1993], O.I.C. File No. A-003985.