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October 6 2007

B.C. Court Right to Make WCB Pay Interest

"The case, in a nutshell, revolves around WCB denying claimants interest on their awards. In other words, WCB thought it could basically keep people's money as settlements dragged on and then - and only then - pay interest if WCB was found to have made a "blatant" error. And that rule, surprise, surprise, was something the WCB came up with on its own in 2001. The B.C. Supreme Court correctly said that was unfair. As Drew Schroeder - the lawyer who fought this battle and won - pointed out, the stress of fighting compensation claims takes a tremendous toll on people's lives. To add another level of economic hardship is simply unacceptable."

WorkSafe B.C. - or the Workers' Compensation Board of B.C. - has always had a tough row to hoe in the public relations department. And for darn good reason. Despite revisions to its rules, it is still viewed as an institution not designed to help get workers proper compensation for job injuries but rather as an institution designed to frustrate, thwart or even deliberately test the fortitude of those who have been forced to deal with its bureaucracy.

So we were pleased to see that the B.C. Supreme Court has ruled against the corporation in a recent case. (see story below).

The case, in a nutshell, revolves around WCB denying claimants interest on their awards. In other words, WCB thought it could basically keep people's money as settlements dragged on and then - and only then - pay interest if WCB was found to have made a "blatant" error. And that rule, surprise, surprise, was something the WCB came up with on its own in 2001. The B.C. Supreme Court correctly said that was unfair.

As Drew Schroeder - the lawyer who fought this battle and won - pointed out, the stress of fighting compensation claims takes a tremendous toll on people's lives. To add another level of economic hardship is simply unacceptable.

The decision will have ramifications in many ways. And compensation could amount to as much as $20 million for thousands of people.

But we see it as a moral victory for the average working Joe or Jill where such victories are few and far between.

But the hitch here is that, ultimately, this money comes out of the public purse. We hope the corporation won't start trying to download these costs and crying the blues when it comes time to pay up. And we hope that this decision will serve as a reminder to all government institutions that any rule that doesn't pass a simple 'do unto others' test shouldn't make it into any regulation handbook.

© Burnaby Now 2007


http://www.canada.com/burnabynow/news/community/story.html?id=e745962e-c9c3-48c9-84a4-47ebae747ee7&k=58114


20,000 people could be impacted by court decision

"Schroeder estimates about 20,000 people could be affected by the court's decision and the funds to be paid out for interest could range from $15 to $20 million."

Theresa McManus
Burnaby Now

A recent decision by the Supreme Court of British Columbia could put money in the pockets of thousands of people who have been injured on the job.

The Supreme Court of B.C. recently ruled in the matter of Gregory Allan Johnson and the Workers' Competition (sic) Board of British Columbia/Workers Compensation Appeal Tribunal. The judicial review considered the WCB's New Interest Policy that was implemented in 2001.

According to court documents, the New Interest Policy says the WCB has the discretion to pay interest on retroactive wage loss and pension lump sum payments only where it's demonstrated that a "blatant" WCB error necessitated the retroactive payment.

Drew Schroeder, the lawyer who represented Johnson in the court proceedings, said the WCB (now WorkSafe B.C.) had paid "very fair interest" on retroactive wage loss prior to the implementation of its new interest policy.

"It was very fair and absolutely correct," he said. "The board had your money over time and were earning money on it."

Johnson injured his back in a workplace accident in 1985 and had back surgery in 1999 that he claimed was a result of the workplace injury. He claimed wage loss benefits from the WCB - a decision that was denied. While he won the appeal and subsequently received retroactive wage loss benefits, he was not paid interest.

B.C. Supreme Court Justice Victoria Gray recently ruled that it's "patently unreasonable" for the New Interest Policy to only provide payment of interest where there is a WCB staff error.

Schroeder estimates the financial ramifications for Johnson would be a "modest" amount in the neighbourhood of $2,000 to $3,000. Because the case was certified as a class proceeding under the Class Proceeding Act, it could have far-reaching effects.

Schroeder estimates about 20,000 people could be affected by the court's decision and the funds to be paid out for interest could range from $15 to $20 million.

"I won't be surprised if the WCB appeals," he said, noting it could be appealed to the B.C. Court of Appeal and then to the Supreme Court of Canada. "I expect ultimately to be successful in the case. It is not over yet."

The case is linked in some ways to William Cowburn and the Workers' Compensation Board of British Columbia, which dealt with the WCB's interpretation of a "recurrence" and the "deterioration" of an injury caused in the workplace. In that 2006 decision, the Supreme Court of B.C. found that the WCB should recognize the difference between a reoccurrence and a deterioration of an injury under the Workers Compensation Act.

Like his case, Schroeder said the Cowburn case dealt with an "unlawful" policy of the WCB.

"Historically the courts have been very, very reluctant to interfere with WCB," Schroeder said. "You can't win."

Schroeder said the Cowburn case may have changed that.

"That was really a breakthrough," he said. "What that case and this case are saying is the courts are concerned about some of these heavy-handed policies. They all impact on the injured workers."

Schroeder believes the courts are sending the message to WCB to become more "even-handed" in its dealings with injured workers.

Schroeder has used some of the affidavits submitted in the Cowburn case to estimate the financial implications of his own case. Some of the same workers were affected by the two court challenges.

"There were about 1,000 people affected, in addition to Mr. Cowburn," he said. "The retroactive cheques being sent out to that group were about $40 million. They put into reserves for the future $60 million."

According to Schroeder, even though the court had determined that the WCB's policy regarding reoccurrence and deterioration, the board had refused to pay interest. He said the outstanding interest to that group is estimated to be between $4 and $6 million, so he suspects it could reach $15 to $20 million for all people affected by the latest decision.

"The interest is building every day," he added.

Schroeder said it's about fairness.

"If you borrow money from a bank, you pay interest. It is absolutely standard," he said, adding the WCB handled it that way until 2002. "They had your money and were earning income on it."

© Burnaby Now 2007


http://www.canada.com/burnabynow/news/story.html?id=48f7ca59-03c5-463a-a07b-8d2918fa0bbc&k=44692




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