Document name

Establishing Initial Wage Base

Document number

POL 06/2016

Average weekly earnings, as determined by Section 70(1) of The Workers’ Compensation Act, 2013 (the “Act”), means the greater of:

1. One fifty-second of the worker’s earnings for the 12 months preceding the commencement of the worker’s loss of earnings resulting from the injury; and
2. The rate of daily, weekly, monthly or other regular gross earnings that the worker was receiving at the commencement of the worker’s loss of earnings resulting from the injury converted, in the case of a daily, monthly or other rate that is not a weekly rate, to a weekly amount.

Gross earnings means the worker’s earnings from employment, before deductions, within an industry under the scope of the Act or for which coverage has been applied for and purchased.

Average gross earnings means the worker’s gross earnings, divided by the number of weeks in a particular period of time.

Regular gross earnings means the daily, weekly, monthly or other gross earnings a worker normally received prior to the commencement of the loss of earnings (e.g., agreement of hire typically requires the worker to work and be paid for 40 hours per week at $25.00 an hour).

1. Section 37 of the Act stipulates that the worker’s eligible gross earnings will be subject to the maximum wage rate applicable at the time of the injury.
2. Section 68(1) of the Act directs that if an injury to a worker results in a loss of earnings beyond the day of the injury, the board shall determine the loss of earnings resulting from the injury and shall ensure compensation to the worker:
   1. In the case of a worker who sustained an injury before September 1, 1985, in an amount equal to 75 per cent of that loss of earnings;
   2. In the case of a worker who sustained an injury on or after September 1, 1985, in an amount equal to 90 per cent of that loss of earnings.
3. Section 68(2) of the Act states that compensation pursuant to subsection (1) is payable for as long as the loss of earnings continues, but the compensation is no longer payable when the worker reaches the age of 65.
4. Section 2(1)(k) of the Act directs that for the purposes of this Act, “earnings” means:
   1. In the case of a worker who sustained an injury before September 1, 1985, the worker’s gross earnings from employment; or
   2. In the case of a worker who sustained an injury on or after September 1, 1985, the worker’s gross earnings from employment less the probable deductions for:
      1. The probable income tax payable by the worker calculated by using only the worker’s earnings from employment as their income, and using only the worker’s basic personal exemption, exemption for dependants and employment-related tax credits, as at the date of the worker’s injury and each anniversary date, as the worker’s deductions;
      2. The probable Canada Pension Plan premiums payable by the worker; and
      3. The probable unemployment insurance premiums payable by the worker.

1. A worker will qualify for wage loss benefits when they experience earnings loss resulting from an injury, beyond the day of injury.
2. Wage loss benefits will be based on the worker’s gross earnings prior to the commencement of loss of earnings and will not exceed the maximum wage rate under the Act at that time.
3. The WCB will use the worker’s regular gross earnings at the commencement of earnings loss or an average of the worker’s gross earnings for the 52 weeks prior to the commencement of loss, whichever is greater.
4. There may be situations where using the 52-week period prior to the commencement of earnings loss to calculate the worker’s wage rate would be inequitable. Therefore, the WCB will ensure that each claim is adjudicated on its own merits to calculate an equitable wage rate. Consideration will be given to the worker’s employment history and pattern, employment status and gross earnings over a period of time that more appropriately reflects the worker’s loss of earnings.
5. Where the worker has worked for a period of less than 52 weeks prior to the commencement of earnings loss or there is insufficient information to determine the worker’s regular gross earnings, the WCB will calculate wage loss benefits based on the following:
   1. Where the worker has regular daily, weekly, or monthly gross earnings prior to the commencement of earnings loss, but has been employed for a period less than 52 weeks, the WCB may use a period less than 52 weeks but greater than 13 weeks to calculate the worker’s average gross earnings. The number of weeks used will be a sufficient period of time to demonstrate that the calculated average gross earnings is an equitable representation of the worker’s gross earnings. To determine wage loss benefits, the WCB will use the calculated average gross earnings or the regular gross earnings at the commencement of earnings loss, whichever is greater;
   2. Where there is insufficient information to determine the worker’s regular gross earnings (e.g., the worker’s employment is casual in nature and or the worker has been employed by the injury employer for less than 13 weeks), the worker’s average gross earnings will be calculated based on the actual period of time over which those gross earnings were earned.
6. Where the worker was not available for employment for the full period of 52 weeks preceding the commencement of earnings loss, or the casual nature of the employment makes it inequitable to determine the worker’s average gross earnings, consideration may be given to using the average gross earnings of a worker regularly employed in the same grade of employment. POL 35/2010, Compensation Rate – Casual and Seasonal Employment – Section 70(4), will apply.
7. Where the worker is employed by two or more employers at the commencement of loss of earnings, the gross earnings will be based on the combined wage base from those employers.
8. Where the worker has applied for, and been granted personal coverage, the wage loss benefits will be based on the level of coverage purchased or confirmed. Section 12 of The Workers’ Compensation General Regulations, 1985 will apply. Where the worker is engaged under other employment arrangements (e.g., contractor, learner), gross earnings will be based upon the applicable coverage guidelines.
9. The worker’s net earnings will be calculated based on gross earnings from employment. POL 03/2007, Calculation of Probable Compensation, will apply.
10. The worker will be entitled to wage loss benefits equal to 90 per cent of their net earnings.
11. Where disablement or death resulting from an injury is delayed (e.g., due to an exposure causing an occupational disease) and there are no gross earnings, POL 08/2007, Compensation Rate - Where No Earnings at Disablement or Death, will apply.
12.  The WCB will recalculate an initial wage base and retroactively increase or decrease compensation benefits if it is determined that information used to established the initial wage base was incorrect.
13. Once an initial wage base has been established, the WCB will not recalculate and retroactively adjust benefits to include salary increases or promotions effective after the day of injury that change pre-injury earnings.