Administrative practice document: Loss-of-earnings (LOE) benefit reviews

Note: This is not a policy; it is a supplementary document to illustrate how the WSIB will administer the Workplace Safety and Insurance Act, 1997, (WSIA) and Policy 18-03-02, Payment and Reviewing LOE Benefits (Prior to Final Review) and 18-03-06, Final LOE Benefit Review in practice. If there is a conflict between this Administrative Practice Document and the WSIA and/or WSIB policy, the decision-maker will rely on the WSIA and/or WSIB policy, as the case may be.

Key principles

  • People are entitled to receive benefits for injuries and illnesses that arise out of and in the course of employment
  • Decision-makers will make quality decisions that ensure people who are injured or made ill at work receive fair compensation, reduce the impact of workplace injuries and illnesses, and improve people’s employment opportunities/prospects and earning ability/capacity after being injured or made ill at work.  
  • When a review leads to a change in someone’s benefits, we will give them reasonable advance notice of the change and the reason for it.

Introduction

Section 43 of the Workplace Safety and Insurance Act, 1997  (WSIA) directs that a worker who has a loss of earnings, as a result of a work-related injury/illness, is entitled to loss of earnings (LOE) payments beginning when the loss of earnings begin, and continue until the earliest of

  1. the day on which the worker’s loss of earnings ceases;
  2. the day on which the worker reaches 65 years of age;
  3. two years after the date of injury, for workers who are 63 years of age or older on the date of injury; 
  4. the day on which the worker is no longer impaired as a result of the injury.

Once initial entitlement for a work-related injury/illness is established, decision-makers determine the person’s eligibility for LOE benefits and the level of benefits payable. Generally, LOE benefits are initially based on the individual’s four weeks’ earnings prior to the injury or illness (provided directly by the employer, or by the individual via their most recent pay stubs). In cases where these short-term earnings do not reflect the person’s long-term earnings profile, the WSIB may perform a long-term recalculation. The WSIB performs long-term recalculations at the 13th week post-injury (see policies related to determining average earnings here). 

The review of LOE benefit payments is outlined in s.44 of the WSIA.  The legislative provisions for LOE benefit reviews include

  • when a material change in circumstances occurs,
  • annual reviews up to 72 months after the date of the worker’s injury, and  
  • a final review at 72 months after the date of the worker’s injury.

The WSIA also outlines the circumstances where the 72-month final LOE benefit payment review may be deferred, and the exceptions that allow review of LOE benefit payments after the 72-month final LOE review.

LOE benefit payments may be reviewed at any time up to 72 months after the date of injury. At each review, the LOE benefit payment amount may be confirmed, adjusted, or discontinued based on changes in the circumstances of the case.

LOE benefit reviews are guided by the WSIA and Policies 18-03-02, Payment and Reviewing LOE Benefits (Prior to Final Review), and 18-03-06, Final LOE Benefit Review, combined with sound case management principles and procedural fairness.

Factors Affecting LOE Benefit Payments

As directed by the WSIA, someone who has a loss of earnings resulting from the work-related injury/illness is entitled to LOE benefit payments. The amount of the LOE benefit payment is determined based on the circumstances of the case, and is intended to compensate the injured or ill person for the actual loss of earnings as a result of the work-related injury/illness.

As decision-makers assess and monitor new information about the someone’s ongoing work-related impairment and functional abilities, they continuously review the person’s entitlement to LOE benefits and the amount of the LOE benefits payable in relation to their recovery and return to work (RTW).

In addition to the age factors outlined in s.43 of the WSIA, factors that may affect the someone’s ongoing entitlement to LOE benefits and/or the level of benefits payable include changes in their:

  • health care/recovery status – while someone continues to be impaired and have a loss of earnings as a result of a work-related injury/illness, their entitlement to LOE benefits generally continues. LOE benefit entitlement ends when clinical evidence indicates the injured or ill person is no longer impaired as a result of the work-related injury/illness.
  • post-injury earnings – where someone is or becomes able to work, the earnings they receive, or are able to earn, are considered to determine the level of LOE benefits payable.  LOE benefit payments cease when the injured or ill person restores, or is able to restore, the (escalated) pre-injury earnings.  Canada Pension Plan (CPP) or Quebec Pension Plan (QPP) disability benefits received for the work-related injury/illness are considered post-injury earnings when considering LOE benefit payments. See Policy 18-01-13, Calculating CPP/QPP Offsets from FEL/LOE Benefits for more details.
  • availability for, or cooperation in, health care or RTW activities or plan – non-cooperation by the injured or ill person may result in the reduction or suspension of the LOE benefit payments, depending on the specific facts of the case.  See Policy 22-01-03, Workers’ Cooperation Obligations.
  • other material changes -  a material change in circumstances is any change that affects someone’s entitlement to benefits and services under the WSIA, such as their health status or earnings. People with claims are personally responsible for reporting a material change to the WSIB and the report must be made within 10 calendar days of when the change occurs.

Decision-makers review the material change information to determine if and how the person’s entitlement to benefits and services is affected and advise the person accordingly.

Adjustments to benefits and services due to a material change are effective the date the change occurred and may result in a recoverable benefit-related debt.

See Policy 22-01-02, Material Change in Circumstances - Worker and 15-06-08, Adjusting Benefits Due to Post-accident, Non-work-related Change in Circumstances.

The ongoing reviews of someone’s entitlement to LOE benefits are guided by s.43 of the WSIA and Policy 18-03-02, Payment and Reviewing LOE Benefits (Prior to Final Review). Where the injured or ill person does not fully recover from the work-related injury/illness, decision-makers will generally continue to review and monitor the case and the LOE benefit payments until all health care measures and RTW activities/plan are completed.  At that time, the injured or ill person may be entitled to ongoing LOE benefit payments if they continue to have an impairment and a loss of earnings as a result of the work-related injury/illness.

While LOE benefit payments continue, they are reviewed annually, and whenever a material change is reported, until the final LOE review.

Annual LOE Reviews

In order to conduct the annual review of the LOE benefit payments, updated information on the injured or ill person’s work-related impairment, employment and earnings status is required.

A discussion with the injured or ill person is required to:

  • obtain an update on their medical condition and determine if a current medical assessment is required
  • clarify and address any issues
  • request updated earnings information (a questionnaire requesting tax and earnings information may be sent to the injured or ill person to validate earnings).

When conducting the annual LOE benefit payment review, decision-makers continue to be guided by Policy 18-03-02, Payment and Reviewing LOE Benefits (Prior to Final Review). In determining the injured or ill person’s LOE benefit payment entitlement, decision-makers review and assess the updated information on their employment status, earnings, and work-related impairment.

At any time, decision-makers may arrange additional health care assessments and/or RTW services if the facts of the case suggest these additional services may help improve the injured or ill person’s recovery and RTW prospects.  Where necessary, the decision-maker may request input from a medical consultant.

For the annual review of LOE benefits, decision-makers consider the following:

  • What are the person’s functional abilities and capacity for work?
  • Has the person received RTW services to identify a suitable occupation (SO), with the injury employer or in the labour market?
  • Is the person employed?
  • Does the employment align with the person’s work ability/capacity and identified SO?
  • Is the SO still available in the local labour market?
  • What are the person’s current earnings or current labour market earnings for the identified SO?
  • Is the person underemployed with respect to hours of work and/or wages?
  • Other relevant material changes, per Policy 22-01-02, Material Change in Circumstances - Worker  
  • Are there other post-accident changes to consider?

Note: Where a SO is identified with the injury employer or in the labour market, the injured or ill person is generally considered capable of full-time employment in that SO. Part-time employment may be considered when medical and functional abilities information clearly demonstrates a capacity for permanent part-time work only.  In such cases, the earnings used to determine the LOE benefit payable would reflect this reduced work ability/capacity.

On completion of the annual LOE benefit review, the decision-maker may confirm, adjust, or discontinue the LOE benefit payments depending on the facts of the case. In all cases, the decision-maker will discuss the outcome of the review with the injured or ill person by telephone (where possible) and then confirm the decision in writing.

When the LOE benefit is to be reduced

Where the review indicates a reduction in the LOE benefit payable, verbal notice is given (if possible), along with information about available representation, such as the Office of the Worker Adviser, which provides services to people who are not members of a union.  Changes in LOE benefits are generally effective one week from the date of the decision letter. The effective date of the change in benefits may be extended up to four weeks from the date of the letter, but no later than the end of the 72-month period, if special circumstances exist, such as

  • the length of time on benefits,
  • an earlier decision on employability,
  • the length of time since the WSIB’s last communication with the injured or ill person.

Note: The change in the LOE benefit payable may be made retroactive to the effective date of the change, if the injured or ill person failed to report a material change in circumstances that affects their entitlement to WSIB benefits. For example, LOE benefits may be reduced retroactive to the date the injured or ill person received a wage increase, or the date of the notice of CPP/QPP disability benefit entitlement. This may result in a recoverable benefit-related debt, see 18-01-04, Recovery of Benefit-Related Debts. 

Exception to annual and final LOE reviews

People who were 55 years of age or older when the WSIB determined they were entitled to LOE benefits may qualify for the “no review” option when they

  • Have reached maximum medical recovery, and completed a RTW plan for a new job

OR

  • Require a RTW plan consisting of vocational skills training, and chooses a 12-month self-directed transition plan to achieve employment.

The “no review” or the combined “self-directed/no review” option, once chosen, is irrevocable, and the LOE benefit is paid until age 65 without any further reviews.

When the “no review” option is chosen and the benefit payable is 10 per cent or less of the person’s full LOE benefit rate, the benefit is automatically commuted (paid in one lump sum) unless they choose to receive ongoing bi-weekly payments. The decision to continue bi-weekly payments is also irrevocable.

Material Change in Earnings

An increase or decrease in post-injury earnings (including CPP/QPP disability benefits) will not always result in an adjustment of the LOE benefit payment.  Decision-makers compare the updated post-injury net average earnings (NAE) with the NAE of the earnings used to pay the LOE benefit. The LOE benefit amount usually will be adjusted if the difference is 10% or greater.

72-month final LOE reviews

The WSIA directs the LOE benefit payment to be reviewed before the end of the 72nd month post-injury, and that the benefit is then payable up to the date the injured or ill person reaches age 65 without further review (information about exceptions in the WSIA is provided later in this document).

The final LOE benefit review process is generally initiated by the 67th month after the date of injury to allow time for the required information to be received and reviewed before the end of the 72nd month.  Decision-makers have the discretion to begin the process earlier when additional time may be needed to gather and analyze the information.

At the 67th month after the injury, written notification of the upcoming final LOE review is sent to the injured or ill person. This notification outlines the information needed for the final LOE review and advises them of:

  • the importance of submitting the requested declaration and information promptly to prevent a disruption in the LOE benefit payments, and
  • the requirement that the final LOE benefit review must be completed by the end of the 72nd month after the injury.

If the injured or ill person fails to respond after one follow-up, the LOE benefit is suspended at the 70th month post-injury, unless there are exceptional circumstances (e.g. CRA closure). The WSIB sends the injured or ill person a final follow-up letter at the 71st month post-injury. The LOE benefit is not restored until a full review occurs. If the final review does not occur by the 72nd month post-injury, the LOE benefit generally cannot be restored retroactively.

The principles, approach and considerations provided earlier in this document are also applicable for the final review of LOE benefit payments. Decision-makers are guided by Policy 18-03-06, Final LOE Benefit Review.   The LOE benefits payable, as determined at the final review, are payable to the date the injured or ill person reaches age 65. The LOE benefit payment cannot be reviewed, unless one of the exceptions outlined below applies.

As it is important that injured or ill people understand the final LOE benefit review decision, all 72-month decisions are discussed with them (where possible), and also communicated in writing regardless of whether the benefits payable are confirmed, adjusted, or discontinued.

Commutation of LOE Benefit

When the Final LOE benefit review is completed, and the LOE benefit payable is 10% or less of the injured or ill person’s full LOE benefit rate, the LOE benefit is automatically commuted (paid in one lump sum) unless they choose to receive ongoing bi-weekly payments. The decision to receive bi-weekly payments is irrevocable.

See Policy 18-03-05, Commutations for more details.

Deferrals - 72 Month Final LOE Review

As noted earlier, the WSIA includes exceptions to the requirement to conduct the final review of the LOE benefit payment at 72 months. The final LOE review may be deferred if, at the time the 72-month period is reached, the injured or ill person is co-operating in:

  • health care measures the WSIB considers appropriate, or
  • RTW activities with the injury employer, or
  • a RTW plan for re-entry into the labour market.

When the final LOE benefit review is deferred, the injured or ill person is advised that the final LOE review is deferred and the reason.  Decision-makers will continue to review and monitor the case and the LOE benefits payable, until the health care measures, RTW activities, or RTW plan are completed.

The final LOE review is done when the health care measures or RTW activities with the injury employer are completed, but must occur no later than 24 months after the 72-month period expired, regardless of whether health care measures or RTW activities are complete.

If the RTW activities with the injury employer do not result in a return to work, the injured or ill person may be provided with a RTW plan.  In these cases, the final LOE review is done 30 days after the RTW plan is complete or 24 months after the 72-month period expires, whichever is earliest.

In cases where the injured or ill person is participating in a RTW plan for the purposes of re-entry in the labour market at the 72nd month, a final LOE review must be completed within 30 days after the RTW Plan is finished (the 24-month rule does not apply).

Health Care Measures

Health care measures mean a medical rehabilitation (MR) program, which is any course of medical or paramedical treatment or care for a work-related injury/illness. The purpose of an MR program is to bring the injured or ill person to a state of maximum medical recovery, so that they may return to suitable and available employment.

Someone is considered to be in a MR program if any of the following situations occur, but is not limited to:

  • receiving active treatment due to the work-related injury/illness
  • attending a WSIB-arranged specialist consultation, or
  • having a prosthesis repaired or replaced.

Generally, the continued use of prescription medication and/or receipt of maintenance physiotherapy or chiropractic treatment are not considered to be a MR program.

Exceptions: LOE Reviews after the Final Review

When the final LOE benefit review is completed, either at the end of the 72-month period or after a deferred final review described above, a further review of the LOE benefit payment can be conducted only if the injured or ill person

  • failed to report a material change that occurred prior to the final review of the LOE benefit payments, or
  • suffers a significant deterioration in his/her work-related condition.

Where the injured or ill person failed to report a material change that occurred prior to the final LOE review, the LOE benefit payments are adjusted retroactively to the date the material change occurred. If appropriate, the final LOE review decision is reconsidered having regard for the material change in circumstances to re-determine the LOE benefits payable as of the original final review date.

A significant deterioration refers to a marked degree of deterioration in the work-related impairment that is demonstrated by a measurable change in clinical findings. A significant deterioration after the final LOE review may include a new area of entitlement, and may be temporary or permanent. To determine if a significant deterioration has occurred, decision-makers are guided by 15-02-05, Recurrences.

When a significant deterioration is established, the LOE benefit payment may be adjusted from the date of the significant deterioration as supported by medical evidence and based on the resulting loss of earnings. Decision-makers will continue to monitor and assess the clinical evidence about the work-related impairment and initiate health care measures or RTW services to assist in the injured or ill person’s recovery and RTW, as appropriate. This may include a new RTW plan, if the deterioration leads to diminished functional abilities. The LOE benefit payments may also be reviewed, and adjusted as appropriate, throughout the duration of the significant deterioration.

A new “final” LOE benefit review must again be conducted but timing of the review is dependent on the level of the injured or ill person’s recovery from the significant deterioration. The new “final” review should normally take place

  • when a significant temporary deterioration ends, or
  • when the decision-maker rules an initial determination or of a permanent impairment or a noneconomic loss (NEL) redetermination is not required, or
  • within 24 months from the NEL processing date if an initial determination of a permanent impairment results in a NEL benefit, or a NEL redetermination results in an increased NEL benefit.

Where an injured or ill person receives a new NEL benefit or an increased NEL benefit following a significant deterioration, the 24-month period for the final LOE review may be extended if they are co-operating in a RTW plan that is not completed by the end of the 24-month period. The review must be completed within 30 days of the completion of the RTW plan.

For LOE benefit reviews throughout the period of a significant deterioration and at the new “final” review, the principles, approach and considerations noted earlier in this document continue to apply and decision-makers are guided by the previously cited policies, as appropriate and applicable.

Communication of Decisions

All adjudicative decisions should be communicated verbally to the workplace parties (where possible), and then confirmed in writing. The decision letter should:

  • identify the issue decided,
  • provide a summary of the facts of the case,
  • provide the entitlement rules that apply to the issue (legislative and/or policy criteria, or standards),
  • provide the rationale for the decision reached, explaining how the entitlement rules were or were not met,
  • reference only evidence that is relevant to the decision, and
  • include the timeframe for appealing the decision.

Every effort is made to communicate decisions in plain language to ensure the decision and reasons for the decision are fully understood by the injured or ill person and employer.

Relative to decisions on LOE benefit reviews, a decision letter must be sent when the LOE benefit payment is being adjusted or discontinued and any time a final LOE benefit review is completed, even if the LOE benefit payment is confirmed. The rationale for the decision should outline the accepted areas of injury/illness, level of impairment, suitable occupation, and the earnings used to determine the LOE benefit payable. Where the injured or ill person is employed and their actual earnings were not used to calculate the LOE benefit payable, the letter should provide an explanation on why those earnings were not used. Similarly, if there is conflicting medical information on the injured or ill person’s impairment and functional abilities, the decision-maker should outline the weight given to the medical evidence and the reasons for how it was weighed.

Document History:

October 2020 – replaces March 2015 document

March 2015 – replaces the document titled “Loss of Earnings Reviews: Practice Guidelines”, dated December 1, 2010

Scheduled Review:

October 2025