DECISION NO. 4/92. Commutation (vehicle purchase).

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1 DECISION NO. 4/92 Commutation (vehicle purchase). The worker was awarded a 15% pension for an upper back condition resulting from his employment as a security guard. He had previously received a partial commutation of his pension. He now sought a full commutation of the remainder for the purchase of a vehicle. The worker completed a microcomputer electronic technology course, sponsored by the Board, and worked as a photocopier repairman. He was laid off, mainly due to an economic downturn, but also partly because of the inadequacy of his vehicle for making calls. The worker returned to work as a security guard, but still took on jobs on his own doing microcomputer repairs. He wanted to return to full-time work in that field once economic conditions improved. The acquisition of a new vehicle would be a continuing rehabilitative measure allowing the worker to maintain suitable employment. The worker had never had financial difficulties before his work accident. Even after that setback, the worker and his wife were able to rearrange their finances and balance their family budget. However, financial institutions would not extend the worker credit to purchase a vehicle at this time. The worker's present $85 monthly pension was not a significant portion of the family budget. The worker had shown an ability to manage his finances and a willingness to return to gainful employment. The worker was entitled to a full commutation which was required as a rehabilitative measure. [7 pages] PANEL: Bigras; Robillard; Nipshagen DATE: 21/01/92 WCAT Decisions Considered: Board Directives and Guidelines: Operational Policy Manual, Document no

2 WORKERS' COMPENSATION APPEALS TRIBUNAL DECISION NO. 004/92 This appeal was heard in Toronto on January 6, 1992, by a Tribunal Panel consisting of: J.G. Bigras : Vice-Chairman, G.M. Nipshagen: Member representative of employers, M. Robillard : Member representative of workers. THE APPEAL PROCEEDINGS The worker is appealing the decision of Hearings Officer, D.R. Queen, dated March 15, The decision denied the worker a part commutation of his 15% pension for the purchase of a motor vehicle. The worker attended and was represented by R. Poynter, constituency assistant to Brian Charlton, M.P.P. for Hamilton Mountain. The accident employer did not attend. THE EVIDENCE The Panel had for its consideration the Case Description prepared from the worker's compensation file by Tribunal Counsel Office and an Addendum, dated December 19, 1991, containing the information concerning the commuted amount of the worker's pension and the worker's statement of monthly income and expenses as well as his surplus and deficit situation. The worker gave oral evidence. THE NATURE OF THE CASE The worker was a guard inspector for a security service. On September 15, 1987, he injured his upper spine in a motor vehicle accident during the course of his employment. He received temporary disability benefits during various periods of time up to January 12, A pension of 15% was granted on August 1, In December 1989, the worker successfully completed a course in microcomputer electronic technology sponsored by the Board's Vocational Rehabilitation Department. In February 1990, the worker found employment as a photocopy technician. In April 1990, the worker obtained a commutation of $20, from his pension to pay off a number of debts which had accumulated since his accident. In January 1991, the worker was asking the Board for another commutation to purchase a motor vehicle which he claimed to be necessary in his work. The request was denied by the Hearings Officer on the grounds that he had failed to show that alternative financing was not available.

3 2 The worker is now asking for a full commutation of his pension -approximately $21, for the purchase of a new motor vehicle. Pensions may be commuted pursuant to section 27(1) of the Workers' Compensation Act, R.S.O. 1990, c. W.11 [section 26(1) of the Act, R.S.O c. 539] which reads as follows: 27(1) Where the compensation is payable by an employer individually or out of the accident fund, the Board may commute the weekly or other periodical payments payable to a worker or dependant for a lump sum, and may charge the same to the employer or to the accident fund, as the case may be. THE PANEL'S REASONS (i) Background The worker is a 31-year-old man, married and the father of two young children. On August 1, 1989, he was granted a 15% pension due to the permanent disability to his upper spine resulting from his work accident of September 15, Following the accident, the worker, who had been a security guard and inspector, was retrained as a microcomputer technologist. He was employed as a photocopier repairman from February 1990 to March 1991 when he was laid off by the employer. Following a period of unemployment, in September 1991, the worker has returned to work as a security guard for the accident employer. In April 1990, the worker was granted a partial pension commutation of $20, to pay off debts which had accumulated since the accident. Later in 1990, the worker applied for another partial commutation for the purchase of a new motor vehicle. He owns an older model vehicle which was no longer suitable for the purposes of his employment. The Hearings Officer denied the commutation on the grounds that the worker had not shown that alternative financing was not available. The worker now states that he requires the full remaining sum of his pension - $21, as of October 1, for the purchase of a new vehicle, preferably a van, in order to pursue his career. Although he is no longer employed as a photocopy technician, the worker is still taking jobs on his own doing microcomputer repairs. He also states that, during humid and cold weather, his pain in the neck is aggravated by cold and damp weather and it is difficult for him to take public transportation to get to his present employment as a security guard. The worker is still looking for full-time employment in microcomputer repairs trying but that it is difficult to obtain such employment during the present recessionary conditions, already causing lay-offs in the industry. Employers insist that workers use their own vehicles to make the calls and offer car allowances.

4 3 The worker is still the owner of an older model vehicle which has been certified by mechanics as not worth repairing. He used that vehicle when he first went to work as a photocopier repairman, but the condition of the vehicle caused him problems. He had been advised by the employer that he would require a better vehicle. The worker states that the lay-off of March 1991, was prompted by a lack of work, but that he he was the first to go because of the condition of his car which was not considered an appropriate means of transportation in the course of his employment. The worker states that, due to the condition of his vehicle, he had encountered problems in making his calls. (ii) The reasoning The Board allows commutations of pensions under section 27(1) of the Act when the worker's request meets the conditions set adopted in Board Minute #4, April 3, 1987, page The guidelines are set out in Document # of the Operational Policy Manual. Those applicable in the present case, along with the authorizing criteria are as follows: A commutation of a monthly pension may be authorized under section 26(1) when: - required as a new or continuing rehabilitative measure intended to enable the person to obtain or maintain suitable employment by reducing the effects of a physical and/or psychological disability... `Reducing the effects of a disability' means reducing the precise limitations imposed by that disability.... A request for commutation must meet the following requirements: - it must be intended for a specific rehabilitation purpose; - alternative resources are not available for the intended purpose; - it must not jeopardize the applicant's ability to meet ongoing financial obligations; - counselling must first be explored. In the present case, we accept that the worker, who has a permanent disability has difficulty getting to and from his present job due to the increased pain during damp and cold weather periods. However, the main reason why he requires a good motor vehicle is that he is presently taking small jobs as a microcomputer repairman and wants to stay in that line of work in order

5 4 to make it full time as soon as economic conditions are improved. The Board sponsored the worker in this training programme which he successfully completed. He used his skills for one year and was laid off partly due to the lack of work and partly due to the unavailability of a better vehicle. We find that the worker meets the general requirement for commutation, and that is that the acquisition of a new motor vehicle would be continuing rehabilitative measure allowing the worker to maintain suitable employment. Our review of the authorization criteria follows. (a) Is there a specific rehabilitation purpose? As stated earlier, we have no difficulty finding that the purchase of a new motor vehicle in the present case will serve to help the worker obtain and maintain work as a microcomputer repairman. This is the suitable employment for which he was re-trained by the Board. We are satisfied that he requires a vehicle in good working order to make calls, at present as a part-time repairman. Also, the availability of a vehicle will not stand in the worker's way in his search for full-time employment as a microcomputer repairman. (b) Are alternative resources available? The worker produced letters from a bank and another from a car maker to the effect that they would not extend him credit at the present time. It is undeniable that the worker has encountered financial difficulties subsequent to his accident and his lay-off from work. As shown later in our review, the worker's financial situation has been redressed, but we are satisfied that he would not be able to purchase a new motor vehicle on credit at the present time. (c) Will the worker be able to meet his financial obligations? Presently, the worker and his spouse are employed, he as a security guard and she as a part-time nurse's aide. Their combined family income is of $1, a month in earnings, $66.00 in family allowance and $84.56 in WCB pension, for a combined total close to $2, With their monthly mortgage payment (mortgage itself is for $65, on a $135, house) reduced from $ to $651.00, car maintenance expected to be reduced from $ to $ a month, and the elimination of the $266 a month payment to the finance company, the family's monthly budget is of about $1, With respect to the worker's financial situation, we note and accept the worker's statement that he had never contracted debts before the accident at work of September 25, 1987, and that he is now well on his way to recovering from this setback. Considering the balanced monthly revenue and expenses statement and the worker's and his spouse's ability to redress an unfortunate debt situation, we find that they are likely to meet their financial situation in the future. We have also considered that the amount of the pension, standing at close to $85.00 a month, cannot be seen as substantial differential factor in the couple's monthly revenue situation. It is also significant to note that the worker expresses confidence that his 15% disability to his upper body is not likely to cause him further work

6 5 lay-offs in the future. Of athletic build, the worker states that he is "aware of his body and its limitation" and does not anticipate problems in performing the light work required in his new trade. We are of the view that, considering that the worker's condition has stabilized at a 15% pension level, and that the financial buffer which would be provided by the $85.00 a month pension which a commutation would replace is negligible, we find that it is not likely that future deterioration would prevent the worker from meeting his financial obligations in the future. (d) The need for counselling The Board's directive that a worker explore counselling before being awarded a commutation is a measure to assure that he will be able to manage his resources in the future and not create further financial problems after a pension has been commuted. In the present case, given the straightforward nature of the worker's financial situation and of the transaction planned as a result of the commutation, and given that the worker, who had never been in financial trouble before his work accident, has been able to re-align his financial situation to a workable level in the recent past, we find that the commutation is not likely to create a situation requiring counselling at this time. We therefore find that counselling is not required. On the issue of redressing the financial situation, the worker deserves commendation, first, for having, along with his spouse, been able to re-finance the home mortgage in order to eliminate payments and interests fees which were too high and, second, for having returned to the lower-paying job of security guard when he was laid off from his job as a microcomputer repairman. He showed a willingness to return to gainful employment which deserves mention. (e) Conclusion Having found that the pension commutation in this case is required as a rehabilitative measure and having found that the worker met the criteria for a commutation of his pension, we are granting a full commutation in this case.

7 6 THE DECISION The worker's appeal is allowed. We are granting the worker a full commutation of his pension. DATED at Toronto, this 21st day of January, SIGNED: J.G. Bigras, G.M. Nipshagen, M. Robillard.