Class action against WSIB claiming unfair benefit cuts given go-ahead

Lawsuit could potentially impact hundreds of workers allegedly denied “full extent of benefits to which they were entitled.

Thestar.com
Feb. 14, 2017
By Sara Mojtehedzadeh

A class action lawsuit alleging Ontario injured workers had their benefits wrongfully slashed has been granted permission to proceed, after the province’s compensation board sought unsuccessfully to block the case.

The suit filed by Toronto lawyer Richard Fink against the Workplace Safety and Insurance Board could impact hundreds of workers. It argues accident victims between 2012 and 2014 were “denied the full extent of benefits to which they were entitled” as a result of “misfeasance in public office” and “negligence” at the board.

The class action was originally quashed two years ago by a Superior Court judge, who said WSIB compensation decisions were “beyond court challenge.” But in a reversal issued Monday, the Court of Appeal ruled it could go ahead.

“This case is about law. As in, the rule of law,” Fink said. “If you accept what we’ve argued in our claim, the board may well be violating the law and should be subject to penalty. And that is a large step forward because it begins to hold the board accountable.”

In a statement to the Star, board spokesperson Christine Arnott said the decision needed to be discussed with the WSIB’s legal counsel “before determining how we will respond.”

“It is important to note that the decision concerns a procedural matter, and makes no determinations about the merits of (the plaintiff’s) case,” she added. “We continue to deny the allegations made in the lawsuit.”

Those allegations include that the WSIB sought to unfairly cut costs through a “secret policy” to “aggressively reduce” the lump sums awarded to workers with permanent injuries sustained in workplace accidents.

The policy suggested benefits could be slashed by blaming at least some of a worker’s injury on a pre-existing condition - even if that condition had never shown any symptoms before the workplace accident, according to the lawsuit.

It represented a significant and some say illegal departure from the founding principles of the worker’s compensation system in Canada: the so-called thin-skull principle, which says workers cannot be discriminated against because of a pre-existing condition that had no physical impact on them before an accident.

The board argued there were no grounds for the allegations, and said it is obliged by law to act in a “financially responsible and accountable manner” - which includes reducing payments to injured workers where appropriate. It also sought to characterize the suit’s allegations as “those of a disgruntled claimant.” Justice Peter D. Lauwers rejected the board’s arguments in Monday’s decision.

The representative plaintiff is former Brampton sewer worker Pietro Castrillo, who permanently damaged his shoulder at work in 2011. He was awarded a lump sum of around $3,000 - but the WSIB subsequently cut the amount in half because it claimed he suffered from osteoarthritis in the injured shoulder.

But Castrillo, now 64, had never previously experienced any symptoms of osteoarthritis. He appealed the board’s decision and won. But he decided to pursue a class action suit after learning about “a number of injured workers” who were similarly impacted by the alleged “secret policy” in operation at the board.

“It’s not just for me, it’s for all these poor people out there who don’t know where to go or what to do,” he said. “They get in accidents and it ruins their lives.”

As previously reported by the Star, the overwhelming majority of appeals from workers who had benefits slashed because of so-called pre-existing conditions have been overturned by the WSIB’s own independent appeals tribunal since 2012. But because of backlogs, it often takes workers’ years to win the entitlements they were owed in the first place.

The board’s alleged “secret policy” was operational roughly between 2012 and 2014, Fink said. In November 2015, it was replaced by a new policy that the board says is compatible with the thin-skull principle and “provides consistency in decision making and alignment with other jurisdictions.” Decisions made under the new policy have yet to reach the board’s appeals tribunal because of long wait times.

Between 2012 and 2014, the portion of claimants deemed to have a permanent injury dropped by 37 per cent, according to the WSIB’s own stakeholder reports.

A Star investigation revealed last year that the WSIB hired U.S.-based doctor Christopher Brigham in 2012 to review its policy on awarding benefits to workers with permanent injuries. The same doctor is currently embroiled in a legal battle in Hawaii for allegedly conspiring with a private auto insurance company to unfairly cut car accident victims’ medical benefits. The allegations have not been proven in court, and Brigham says he is a “strong advocate for those who are recovering from injury or illness.”

Fink’s class action against the board alleges that the WSIB’s approach to pre-existing conditions was “motivated by a desire to reduce costs,” and “the defendant knew it was acting illegally and that its actions would harm the plaintiff and class.”

The suit must now wait to be certified as a class action, although the WSIB could also seek an appeal at the Supreme Court of Canada.

Fink noted that under the compensation system, workers’ give up their right to sue their employers in exchange for a fair shot at compensation if they are hurt on the job.

“This is not an insurance company. This is a workers’ compensation system. They are to take care of injured workers because they’ve knocked you out of litigation,” he said.

“Their mandate should be, try and do the best you can for the injured worker within reason.”