Financial Services Commission

Commission des services financiers de l’Ontario

Neutral Citation: 2000 ONFSCDRS 145

Appeal P00-00005

OFFICE OF THE DIRECTOR OF ARBITRATIONS

WAWANESA MUTUAL INSURANCE COMPANY

Appellant/Respondent

and

BRENT FORD

Respondent/Appellant

Before:

David R. Draper, Director's Delegate

Counsel:

Greg Birston (for Wawanesa)

Alex W. Demeo (for Brent Ford)

APPEAL ORDER

Under section 283 of the Insurance Act, R.S.O. 1990, c.I.8, as amended, it is ordered that:

1. Mr. Ford's appeal is allowed in part. Paragraph 1 of the arbitration order dated December 10, 1999, dealing with the calculation of his income replacement benefits, is revoked and replaced with the following:

2. Wawanesa shall recalculate Mr. Ford's income replacement benefits on the basis of a gross annual income from employment of $44,439.85.

3. By agreement, Paragraph 2 of the arbitration order is amended to change the date from January 19, 1998 to April 27, 1998. In addition, the order is amended to clarify that indexation is to apply to Mr. Ford's net weekly income, calculated based on paragraph 1, for each January following the accident. Therefore, paragraph 2 of the arbitration order dated December 10, 1999 is revoked and replaced with the following:

4. Mr. Ford's pre-accident earning capacity is his net weekly income from employment used to determine his income replacement benefits immediately before the payment of the weekly loss of earning capacity benefits began on April 27, 1998, as indexed according to s.79(1) of the SABS-1994 each January 1^st following the accident.

5. Mr. Ford's appeal on the special award issue is dismissed.

6. Wawanesa's appeal on the residual earning capacity issue is dismissed.

7. Mr. Ford is entitled to his reasonable appeal expenses, payable by Wawanesa.

8. If a determination is required of Mr. Ford's pre-accident income under s.29(4) of the SABS-1994, or any calculation resulting from this order, either party may ask for a resumption of the appeal within 60 days of this order.

August 4, 2000

David R. Draper

Director's Delegate

Date

REASONS FOR DECISION

I. NATURE OF THE APPEAL

Both parties appeal from an arbitration order dated December 10, 1999. Mr. Ford challenges the calculation of his income replacement benefits ("IRBs") and loss of earning capacity benefits ("LECBs"). In his submission, the arbitrator erred in his approach to vacation pay. Mr. Ford also submits that the arbitrator erred in refusing to order Wawanesa Mutual Insurance Company ("Wawanesa") to pay a special award. Wawanesa's appeal deals only with the calculation of LECBs. It objects to the arbitrator's determination that Mr. Ford's residual earning capacity ("REC") is zero. More specifically, Wawanesa argues that the arbitrator erred in concluding that the type of employment selected by the Residual Earning Capacity Designated Centre ("REC-DAC") does not exist in his community.

II. BACKGROUND

Mr. Ford was injured in a motorcycle accident on August 4, 1995. He had just started his holidays, driving from his home in Thunder Bay to British Columbia, when he collided with a van. He suffered multiple injuries, preventing him from returning to work. His insurer, Wawanesa, accepted his claim and paid accident benefits, including IRBs.

According to s.10 of the SABS-1994,¹ IRBs are 90 per cent of the insured person's net weekly income from employment. The calculation starts, however, with a determination of the person's gross annual income. Those, like Mr. Ford, who qualify for IRBs as employed can elect to have their gross annual income determined on the four, 52 or 156 weeks before the accident.² This amount is converted to gross annual income according to s.9(1) and then to net weekly income according to s.81 or 82 of the SABS-1994.

This is not a case where the income information is incomplete or challenged. Mr. Ford's employer, Shaw Bakery, provided detailed breakdowns of his earnings for various periods. The question is how to apply the legislation to the facts of the case.

Mr. Ford was paid every other week. The amounts he received before the accident were based on the following components:

(i) base pay and commission;

(ii) taxable benefits ($4.33 accrued every two weeks);

(iii) miscellaneous (purchased commission);

(iv) vacation pay (paid based on accrued vacation from the previous year, which accrued at 8% of Mr. Ford's base pay, commissions and miscellaneous (purchased commissions).

Wawanesa initially determined that Mr. Ford's gross annual income was $41,707.82, although the details of this calculation are unclear. This resulted in IRBs of $496.99.³ Through counsel, Mr. Ford asked Wawanesa to reconsider the amount of his IRBs. In September 1996, a new calculation was done, resulting in a gross annual income of $42,612.63. Again, the details of this calculation are unclear, but resulted in IRBs of $507.30. Counsel then suggested that the calculation should be based on the four weeks before the accident, referring to information from Shaw Bakery that Mr. Ford earned $3,540.42 during that period:

Week ending July 8

$ 967.63

Week ending July 15

778.11

misc.

138.09

Week ending July 23 - Vacation pay

777.86

Week ending July 30

793.53

misc.

76.35

Taxable benefits for 4 weeks

$3,540.43

(Taxable benefit on insurance premium)

8.66

TOTAL

$3,540.43

Wawanesa accepted this approach, resulting in gross annual income of $46,025.59 and IRBs of $547.70. Mr. Ford received IRBs on this basis.

When the time came to calculate Mr. Ford's LECBs, Wawanesa followed s.29(1) of the SABS-1994 and based his pre-accident earning capacity ("PEC") on the net weekly income used to calculate his IRBs. With respect to his REC, Wawanesa set it at a gross annual income of $33,280. Consequently, its LECB offer was $121.38 per week. Mr. Ford rejected this offer. As a result, an assessment was arranged by a REC-DAC. The REC-DAC determined Mr. Ford's REC was $18,747 based on his ability to work part-time as a sales representative in the technical wholesale trade.

At the arbitration hearing, Mr. Ford challenged the calculation of his gross annual income from employment, affecting both his IRBs and LECBs. He elected the four weeks before the accident, but argued he was entitled to rely on the extrapolation provisions in s.9(7) of the SABS-1994 on the basis that he was "not employed" or "on a leave of absence without pay" during his holiday week. Using this approach, the calculation would be done by taking his income in the three weeks he worked and extrapolating it over the four weeks. Mr. Ford claimed this would result in a gross annual income of approximately $51,000 — higher than the $46,025.59 figure used by Wawanesa.

Mr. Ford also objected to the REC-DAC's assessment of his REC. While he accepted its evaluation of his capabilities, he argued that the type of employment selected by the REC-DAC was not appropriate because, among other things, there were no such jobs in the Thunder Bay area.

These issues were dealt with in a three-day hearing in May and June 1999. In his decision, the arbitrator started by questioning the four-week period used by the parties in their calculations. They used the four weeks ending July 30, 1995, one week before the accident, but the arbitrator felt they should have included the week of the accident. Rather than simply accepting the figures provided by the parties, he adjusted them based on the payroll records starting one week later. Using the adjusted amounts, the arbitrator found that if the vacation pay Mr. Ford received is included as income in the four weeks before the accident, his gross annual income would be $44,447.26 — less than the amount used by Wawanesa. On appeal, Mr. Ford initially argued that the arbitrator overstepped his authority in doing this. However, by the time of the hearing, the parties had agreed to work with the four weeks ending August 5, 1995, the date of the accident.

Although Mr. Ford's primary argument was about extrapolation, the arbitrator next considered the appropriate allocation of vacation pay. Relying on the arbitration decision in Nguyen and Progressive Casualty Insurance Company, (OIC A-004698, August 31, 1994), he held that vacation pay should be treated as income as it accrues, not when it is received. As a result, he calculated the amount of vacation pay that accrued in the four weeks, arriving at $119.70. When this figure was included in the four-week period, the arbitrator found that Mr. Ford's gross annual income was $35,891.18, substantially less than the $46,025.59 figure used by Wawanesa.

Because this calculation would have reduced Mr. Ford's weekly benefits, the arbitrator looked at his entitlement based on the 52 weeks before the accident. He found that this led to a gross annual income of $42,303.54, and ordered Wawanesa to recalculate the IRBs based on this amount. On appeal, Mr. Ford questions the arbitrator's treatment of his vacation pay, and his authority to unilaterally choose the 52-week period.

Next, the arbitrator dealt with Mr. Ford's extrapolation argument, rejecting it for reasons set out below:

I do not accept Mr. Ford's argument. Mr. Ford qualified for income replacement benefits under paragraph 1 of subsection (7)(1) because he was employed at the time of the accident. Mr. Ford's employment was not terminated when he went on vacation. He was still under a contract of employment with Shaw Bakery. But for the accident, he would have returned to his job when he finished his vacation. Had Mr. Ford lost his job with Shaw Bakery during the four weeks before the accident, he would be allowed to designate the four weeks and extrapolate his income. But this was not the case. (p.9)

Mr. Ford challenges this analysis on appeal. More specifically, he submits that the arbitrator failed to address his argument that he was on a "leave of absence without pay."

Whatever the correct figure for gross annual income from employment, it is used to calculate net weekly income from employment according to section 81 or 82 of the SABS-1994. This amount is used to calculate the IRBs and the PEC component of LECBs, as reflected in paragraph 2 of the arbitrator's order. The parties agree, however, that the date in the order is wrong. The payment of LECBs began on April 27, 1998, not January 19, 1998. Therefore, the order will be amended to reflect the correct date.

Finally, the arbitrator dealt with Mr. Ford's REC. He made findings about Mr. Ford's limitations that are not contested. Based on the REC-DAC report, he found the type of employment that best satisfied the criteria in s.30(2) of the SABS-1994 was "part-time employment (five hours a day/five days a week) as a sales representative in a wholesale trade that is related to the beverage or food industry." After rejecting Mr. Ford's argument that only full-time work should be considered, the arbitrator held that Wawanesa failed to establish that this type of employment exists in the Thunder Bay area. In its appeal, Wawanesa challenges this conclusion.

III. ANALYSIS

A. Calculation of Gross Annual Income from Employment

The parties, quite helpfully, provided the various possible calculations set out in the following chart:

ALTERNATIVE CALCULATION METHODS OF CALCULATING GROSS ANNUAL INCOME

GROSS ANNUAL INCOME

1. Wawanesa's calculation based on the four weeks ending July 30, 1995, including the vacation pay Mr. Ford received.

$46,025.59

2. The arbitrator's calculation at page 8 of his decision. This is based on the income Mr. Ford received in the 52 weeks before the accident, including vacation pay.

$42,303.54

3. Calculation #2 adjusted by taking out vacation pay received and including accrued vacation pay and taxable benefits [GAI = $40,343.34 + $3,227.47 + $112.58 + 273.42].

$43,956.80

4. The arbitrator's calculation at page 8 of his decision. This is based on Mr. Ford's income for the 4 weeks before the accident, not including the vacation pay he received but including the vacation pay the arbitrator found accrued during the four-week period.

$34,335.08

5. Calculation #4 adjusted to include 8% for vacation pay accrued on income earned and $8.66 for four weeks of taxable benefits [GAI = ($2,641 + $211.29 + $8.66) x 13]

$37,194.43

6. Calculation based on income in the four weeks before the accident, including the vacation pay Mr. Ford received. [$3,636.55 x 13]

For detailed calculation, see Appendix A.

$47,275.15

7. Calculation using extrapolation. [($2,856.52 + 3) x 52]

For detailed calculation, see Appendix A.

$49,513.01

Mr. Ford's preference is to rely on the extrapolation provisions in s.9(7) of the SABS-1994. If he can, the other calculation issues disappear. As set out in the table above, his gross annual income from employment using this approach would be $49,513.01 — higher than the $46,025.59 used by Wawanesa.

Subsection 9(7) applies to Mr. Ford because he qualified for IRBs as an employed person. It provides as follows:

9.—(7) . . . a determination under subsection (1) of the person's gross income for a period of time shall be made by taking the person's gross income from employment for the part of that period for which the person earned income from employment and extrapolating it over any part of the period for which the person,

(a) did not receive temporary disability benefits under the Unemployment Insurance Act (Canada); and

(b) did not earn any income from employment for one of the following reasons:

1. The person was not employed.

2. The person was on a leave of absence without pay.

3. The person was on a layoff from employment.

4. The person was on strike from employment or was locked out from employment.

The arbitrator held that Mr. Ford continued to be employed during his vacation, making s.9(7)(b)1 inapplicable. It is not clear, however, that he considered the layoff provision in paragraph 4.

On appeal, Mr. Ford claims that his vacation qualifies as a "layoff from employment," within the meaning of s.9(7)(b)3. In support of this argument, he relies on definitions from Black's Law Dictionary. "Vacation" is defined as:

a recess or leave of absence; a respite or time of respite from active duty or employment, an intermission or rest period during which activity or work is suspended. It is a period of freedom from duty or work, but not the end of the employment . . . (emphasis added)

"Leave of absence" is defined as:

temporary absence from employment or duty with intention to return during which time remuneration and seniority may or may not be suspended.

Looking at his situation, Mr. Ford argues that he had permission to absent himself from his employment and was not paid for this period. Instead, he received vacation pay accrued during the previous year. This, he contends, amounts to a leave of absence without pay.

I am unable to accept this argument. In my opinion, the common meaning of vacation is not synonymous with a leave of absence. Nor does Mr. Ford's interpretation fit within the context of the legislation. "Leave of absence without pay," like the other reasons listed in s.9(7)(b), involves a break in employment that goes beyond regular absences such as vacations. In an organized workplace like Shaw Bakery, vacations and vacation pay are part of the compensation package, providing time off and some level of compensation. Whether his vacation pay accrued in the current or previous year, it is income from employment.

As a result, Mr. Ford's appeal on this issue is dismissed. However, that does not end the matter. At both arbitration and appeal, Mr. Ford elected to have his benefits determined on the four weeks before the accident. Having rejected his extrapolation argument, the proper calculation still must be determined. Looking back at the chart, the parties suggest two possible options. If the vacation pay Mr. Ford received is included in income in the four weeks before the accident, his gross annual income from employment is $47,275.15. Alternatively, if the accrual approach to vacation pay is accepted, Mr. Ford’s gross annual income from employment is considerably lower — $37,194.43.

The arbitrator adopted the accrual approach because he found it better reflected Mr. Ford’s earnings profile. In doing so, he followed the decision in Yen V. Nguyen, cited above. In that case, Mr. Nguyen worked during the summer and was laid off in the winter. He did not get any vacation time, but consistent with the requirements of the Employment Standards Act, R.S.O. 990, c.E.14, he received a percentage of his income over the previous 12 months as vacation pay. In December 1992, he was injured in an automobile accident, just one week after his seasonal lay-off. In the four weeks before the accident, he received his full vacation pay along with his regular wages. The question, as here, was how to allocate the vacation pay. On the facts before her, the arbitrator held that it "reflects the reality of Mr. Nguyen's earnings profile to allocate the money at the rate that it accrues."

The arbitrator found the facts here similar to those in Yen V. Nguyen, stating that the vacation pay Mr. Ford received in the four weeks before that accident ($777.86) was half the amount he accrued over the 52 weeks before the accident ($1,555.72). It is unclear, however, how the arbitrator determined the $1,555.72 figure. Mr. Ford accrued vacation pay based on 8 per cent of his income. The arbitrator found that his income in the 52 weeks preceding the accident was $42,303.54, suggesting that his accrued vacation pay was over $3,000. On appeal, the parties agree that his accrued vacation pay was $3,227.47.⁴

In my opinion, this case is distinguishable from Yen V. Nguyen. Mr. Ford’s vacation pay was in no sense a windfall. It was not paid on top of other income, but as part of his regular work schedule, which included vacation time. Consequently, I see no reason the "income when received" approach cannot be adopted. However, the two approaches cannot be mixed. If Mr. Ford’s income includes the vacation pay he received, it cannot also include his accrued vacation pay. Therefore, calculation #6 on the table must be revised by taking out accrued vacation pay. By my calculation, this leads to a gross annual income of $44,439.85.⁵

Given the history of this matter, I would be inclined to give Mr. Ford an opportunity to re-elect the 52-week period. However, the "income when received" approach results in a lower figure — $42,303.54.⁶ In my view, the accrual approach, based on 8 per cent of Mr. Ford's income, is also an appropriate option in this case. However, this will not help him over the four-week period, and even over 52 weeks, the amount is slightly less than using the "income when received method" for the four-week period — $43,956.80.⁷

For these reasons, I conclude that Mr. Ford’s benefits should be calculated based on a gross annual income from employment of $44,439.85. This is less than the amount used by Wawanesa, but more than the arbitrator ordered. However, adjudicators dealing with the proper amount of accident benefits are not limited to choosing between two incorrect amounts. Mr. Ford had ample opportunity on the appeal to present his arguments on how his benefits should be calculated.

Finally, Mr. Ford argues that if the amount of his gross annual income from employment is reduced below the amount used by Wawanesa, he should be able to consider the application of s.29(4) in calculating his LECBs. This section provides that in calculating the insured person's pre-accident income, the amount shall not be less than "the net weekly income determined in accordance with section 81 or 82 using a gross annual income from employment equal to the person’s gross income from employment, including any temporary disability benefits and any benefits received under the Unemployment Insurance Act (Canada), for a period specified by the person of 52 consecutive weeks in the 156-week period before the accident." Although he did not present any figures, Mr. Ford suggested he might be able to find a 52-week period that would exceed his reduced gross annual income from employment.

Although I am reluctant to extend this dispute any further, I conclude that Mr. Ford should have an opportunity to make this claim. Rather than force it back to the beginning of the dispute resolution process, I will remain seized for a period of 60 days. If this issue, or any other calculation required by my order, cannot be resolved, either party can notify me in writing, with a copy to the other party, within this period. Otherwise, the appeal file will be closed.

B. Special Award

Mr. Ford submits that the arbitrator erred in refusing to order Wawanesa to pay a special award under s.282(10) of the Insurance Act on the basis that it unreasonably delayed paying benefits at the proper rate. I do not agree. In my opinion, he considered appropriate factors and reached a decision within his authority. While Wawanesa could have explained some of its decisions more clearly, the test is not perfection. As the arbitrator found, it responded to information provided by Mr. Ford, reconsidered its position and, when convinced its calculations were wrong, paid him the benefits owing, plus interest. This is borne out by the exhibits which, in my view, support the arbitrator's conclusion. Therefore, this aspect of Mr. Ford's appeal is dismissed.

C. Indexation

In dealing with Mr. Ford's PEC, the arbitrator ordered that it was "his net weekly income from employment immediately before the payment of weekly LECBs began on [April 27, 1998], indexed in accordance with paragraph 79(1)1 of the Schedule." Wawanesa interpreted this to mean that indexing did not begin until the January following the order. Mr. Ford disagrees, arguing that the indexing is to be done on his net weekly income from employment, as determined by the arbitrator, for each January after his accident.

On appeal, Wawanesa does not challenge the arbitrator's order, but merely asks for clarification. Normally, I would be reluctant to provide an interpretation of an arbitrator's order. In this case, however, it is clearly explained in the decision. At page 10, the arbitrator holds that the net income used to calculate PEC is the indexed amount. Not only do I find the arbitrator's position clear, I agree with it. LECBs are calculated by comparing PEC with REC. As REC is measured in current dollars, it is only fair that PEC include the indexing provided in s.79(1).

D. Residual Earning Capacity

REC is determined under s.30 of the SABS-1994, which provides:

30.—(1) For the purpose of this Part, the residual earning capacity of a person shall be deemed to be the net weekly income determined in accordance with section 81 or 82 using the gross annual income that the person could earn from the type of employment that best satisfies the criteria set out in subsection (2).

(2) The criteria referred to in subsection (1) are:

1. The person,

i. is able and qualified to perform the essential tasks of the employment, or

ii. would be able and qualified to perform the essential tasks of the employment if the person had not refused to obtain treatment or participate in rehabilitation that was reasonable, available and necessary to permit the person to engage in the employment.

2. The employment exists in the area in which the person lives and is accessible to the person.

3. It would be reasonable to expect the person to engage in the employment having regard to the possibility of deterioration in the person’s impairment and to the person’s personal and vocational characteristics.

(3) For the purpose of subsection (2), a person is able and qualified to perform the essential tasks of an employment if,

(a) the person does not have any impairment that permanently prevents the person from performing those tasks; and

(b) the person has the job skills and any licence or other credentials required to perform those tasks, or could obtain those skills and the licence or credentials without significant effort.

The term "personal and vocational characteristics" is defined in s.1 of the SABS-1994, to include employment history, education and training, vocational interests and aptitudes, vocational skills, physical abilities, cognitive abilities and language abilities.

Wawanesa initially made an LECB offer using a REC of $33,280 based on its view that Mr. Ford could work in a different position at Shaw Bakery — packing machine operator. When Mr. Ford rejected the offer, he was referred for a REC-DAC assessment in accordance with s.27 of the SABS-1994.

REC-DACs operate according to the legislation and guidelines established by the Minister’s Committee on the Designated Assessment Centre System.⁸ In this case, the REC-DAC did a multi-disciplinary assessment over two weeks using a process described in the arbitration decision. In its report, the REC-DAC sets out its medical, physiological and psychological assessments, as well as the results of a functional capacities evaluation and a simulated work tolerance activities assessment. Mr. Ford accepted that these assessments accurately reflected his capabilities. He did not agree, however, with the conclusion that his REC was $18,747 based on part-time employment as a sales representative in the technical wholesale trade.

After the REC-DAC provides its report, the legislation allows the insurer to adjust the benefits based on the results.⁹ It is clear, however, that either party can challenge the amount through the dispute resolution system. It follows that arbitrators are not bound by the REC-DAC's conclusion, although it is meant to provide an independent assessment by qualified professionals familiar with the legislation that the parties and arbitrators will find helpful. The arbitrator reviewed the REC-DAC report in some detail, accepting most of it. With respect to Mr. Ford's capabilities, he found as follows:

In summary, I find that due to the injuries to his right shoulder area, chronic pain and fatigue, Mr. Ford is unable to engage in any employment that requires repetitive fine motorized dexterity tasks; repetitive reaching, lifting, carrying, or push/pull activities and activities that require prolonged positioning and mobility. I find, however, that Mr. Ford's impairments do not prevent him from engaging in employment that requires lifting under 20 pounds, frequent lifting or carrying of materials weighing up to 10 pounds and walking, standing or sitting for the majority of a shift of up to five hours per day, five days a week, with frequent breaks and changes of position throughout the work day. (p.16)

The arbitrator found that, according to the REC-DAC, the type of employment that best satisfied the criteria was part-time employment (five hours a day/five days a week) as a sales representative in a wholesale trade related to the beverage or food industry. Although he accepted that Mr. Ford was capable to doing this kind of work, the arbitrator was not satisfied that the evidence established that this type of employment exists in the Thunder Bay area. As this is one of the criteria in s.30(2), he concluded that Mr. Ford's REC was zero.

Wawanesa appeals from this part of the decision, arguing that the arbitrator erred in his interpretation of s.30(2)2 of the SABS-1994. In its submission, the REC-DAC followed the Guideline and provided a sufficient basis for its conclusions.

According to the Guideline, the REC-DAC is to select an employment type from the National Occupational Classification ("NOC") that represents the insured person's REC. This is what it did in identifying the position of "sales representative, wholesale trade (non-technical)," NOC 6411. The REC-DAC must ensure that this position meets the criteria, including the following:

3. The employment exists in the area in which the claimant lives. The term "exists" means whether or not the selected employment can be found in the area in which the claimant lives. The employment "exists" if there are people employed in that employment type in the claimant’s area . . .

4. The employment is accessible to the claimant. The term "accessible" means the likelihood of a claimant securing the employment type selected by the DAC. In considering the selected employment, it is accessible if the claimant reasonably could compete for a job of that employment type, should a job become available.

Wawanesa notes that the revised Guideline suggests contacting various sources to determine whether the employment exists in the area, including Human Resources Development Canada ("HRDC") and employers.¹⁰ In this case, the REC-DAC contacted eight local employers in the beverage/food wholesale business and looked at labour market information from the HRDC for the Thunder Bay area, reporting as follows:

Job Availability

Fair-Good. Of the 8 employers contacted for this survey, less than half expected to hire within the next few months. Reference to HRDC's Job Statistical Outlook in the Thunder Bay area, suggest a fairly stable increasing job market, with 111 advertised opportunities, 98 full time and 13 part time [in 1997]. The employment opportunities are reported identified to being on the incline annually.

According to the arbitrator, the HRDC information also indicated that there were five part-time positions advertised in August 1997, none in September 1997 and one in October 1997.

In its summary, the REC-DAC states:

This vocational goal would appear to be realistic for Mr. Ford given that a good job market presently exists in Thunder Bay for Sales Representative in the wholesale field. It matches his previous work history and employers will hire candidates with related experience. Mr. Ford would need to find a work site that would accommodate his physical limitations.

The arbitrator was not persuaded that this information was sufficiently specific to determine that the type of employment best satisfying the criteria for Mr. Ford — part-time employment (five hours a day/five days a week) as a sales representative in a wholesale trade related to the beverage or food industry — existed in the Thunder Bay area. He found that the HRDC information related to all areas of the non-technical wholesale trade, without looking specifically at the beverage or food industry. The problem with the REC-DAC's employer contacts, in his view, was that they asked about full-time employment, not part-time.

In preference to this evidence, the arbitrator accepted the testimony of Mr. Ford and Mr. Donald Kobelt, a rehabilitation consultant, that they were unable to identify any employment opportunities in the Thunder Bay area for a part-time sales representative in the beverage or food industry. As a result, he was not satisfied that the criteria were met.

Wawanesa argues that the arbitrator erred in placing too much importance on the availability of part-time employment. In its submission, the criteria do not distinguish between full-time and part-time employment. The correct question, it contends, is whether the "type of employment," using the HRDC job categories, exists in the community. In other words, is there employment in the Thunder Bay area, whether currently available or not, for sales representatives in the non-technical wholesale trade? Wawanesa submits that the evidence clearly established that there was.

I am unable to accept Wawanesa’s position. The arbitrator held, correctly in my view, that part-time employment can be considered in evaluating the insured person’s REC. However, according to s.30(2)2, that type of employment must exist in the area and be accessible to the insured person. It follows that if part-time employment is being considered, the existence and accessibility of part-time employment must be determined. It simply does not make sense to determine the existence of full-time employment for someone who cannot work full-time. While the REC-DAC may have followed the Guideline, I find no error in the arbitrator’s reconsideration of its conclusions. Further, the arbitrator's assessment of the evidence concerning the existence of part-time work was within his authority. As a result, Wawanesa's appeal is dismissed.

IV. APPEAL EXPENSES

Mr. Ford was successful in his appeal and in resisting Wawanesa’s appeal. Nothing in his conduct would warrant denying or reducing his expenses. Consequently, I have no hesitation in ordering Wawanesa to pay his reasonable appeal expenses, determined according to the relevant legislation, set out in the Dispute Resolution Practice Code.

August 4, 2000

David R. Draper

Director’s Delegate

Date

APPENDIX A

The parties agree on the following income figures for the purposes of this appeal:

(i) Week ending July 15, 1995

Base & Commission ($1,45.94 + 2)

$ 778.11

Miscellaneous

69.05

$ 847.16

8% vacation pay

75.32

$ 922.48

Taxable benefit ($4.33 + 2)

2.17

$ 924.65

(ii) Week ending July 22, 1995

Vacation pay

$ 777.86

Taxable benefit

2.17

$ 780.03

(iii) Week ending July 30, 1995

Base & Commission

$ 793.53

Miscellaneous

76.35

$ 869.88

8% vacation pay

69.59

$ 939.47

Taxable benefit ($4.33 + 2)

2.17

$ 941.64

(iv) Week ending August 4, 1995

Base & Commission

$ 844.25

Miscellaneous

70.62

$ 914.87

8% vacation pay

73.19

$ 988.06

Taxable benefit ($4.33 + 2)

2.17

$ 990.23

CALCULATIONS USED IN THE TABLE

Calculation #6 - $924.65 + $780.03 + $941.64 + $990.23 = $3,636.66

$3,636.66 x 13 = $47,275.15

Calculation #7 - $924.65 + $941.64 + $990.23 = $2,856.52

$2,856.52 + 3 x 52 = $49,513.01

Footnotes

1. 1Ontario Regulation 776/93, as amended, the Statutory Accident Benefits Schedule—Accidents after December 31, 1993 and before November 1, 1996.
2. 2SABS-1994, s.7(2).
3. 3The IRBs set out in this part of the decision do not include any reduction for Mr. Ford's collateral benefits of $140 per week that he received for 26 weeks.
4. 4See calculation #3 on the chart on page 8.
5. 5($849.33 + $780.03 + $872.05 + $917.04) x 13 = $44,439.85.
6. 6Calculation #3 on the chart on page 8.
7. 7Calculation #3 on the chart on page 8.
8. 8The guidelines are not Commissioner's guidelines under s.268.3 of the Insurance Act, as suggested by the arbitrator. The guidelines in effect at the time were issued in November 1996: Guidelines for Designated Assessment Centres to Conduct Residual Earning Capacity Assessments for Accidents on or after January 1, 1994 and before November 1, 1996 ("Guideline ").
9. 9SABS-1994, s.23(5).
10. 10Residual Earning Capacity Designated Assessment Centre Assessment Guidelines, dated June 1999. The other suggested sources are occupational or professional associations, unions, newspapers, personnel counsellors, personnel agencies (including temporary placement services) and colleges, universities and training schools.