Benefit Related Debts/Overpayments

Information adopted from the Ontario Worker Adviser (OWA) website. Used with permission.

This information applies to Benefit-Related Debts created on or after May 1, 1998. For Benefit-Related Debts created in prior periods, different rules may apply. Sometimes the WSIB will decide that it has made an error in calculating benefits and has paid out too much money to a worker.

What Is a Benefit-Related Debt?

A benefit-related debt is any payment made by the WSIB that exceeds the amount to which a person is entitled. Previously, WSIB referred to these as “overpayments.” Both terms refer to the same thing.

When Will WSIB Pursue Recovery of a Benefit-Related Debt?

WSIB will pursue full recovery of a benefit-related debt in the following situations:

• WSIB paid benefits for a time period for which you also received earnings from employment.
• You experience a “material change in circumstances” that affects your entitlement to WSIB benefits or services.
• You provided false or misleading statements or other information to WSIB in an attempt to obtain payments unlawfully.
• A debt results from an administrative error and you knew or reasonably should have known that the payment exceeded the amount of your benefit entitlement.

When Will WSIB Not Pursue Recovery of a Benefit-Related Debt?

WSIB will not pursue recovery of a benefit-related debt in the following situations:

• Where the debt results from WSIB changing a previous decision on reconsideration or appeal. This may be due to:
  • the original decision is not consistent with legislation or approved policy, or
  • because new evidence changes the decision.
• A debt results from an administrative error and you could not have reasonably been aware of the error. Errors may include:
  • miscalculation and mathematical errors,
  • authorizing and issuing duplicate payments, or
  • inaccurate data entry.
• WSIB did not notify you in writing of the debt within three years of the date the debt is considered due and owing. This “three-year rule” does not apply if the debt results from failure to notify WSIB of a material change in circumstances, or from fraud or false or misleading statements.

If you can show WSIB that recovery of the debt will result in financial hardship, WSIB may eliminate all or part of the debt. This policy regarding financial hardship does not apply if the debt results from failure to notify WSIB of a material change in circumstances, or from fraud or false or misleading statements.

How Can You Prove Financial Hardship?

WSIB may exercise its discretion to reduce or eliminate a benefit-related debt in cases of severe, long-term financial hardship where the failure to reduce or eliminate a debt will compromise a person’s ability to maintain the necessities of life; for example, food, shelter, or transportation to work. Factors that WSIB will consider include the following:

• employment status, employment security, earning capacity;
• clinical restrictions, which may prevent you from increasing employment earnings;
• opportunities for re-employment, if you are not employed currently;
• personal and vocational characteristics (e.g., your level of education);
• assets (e.g., automobile, property, home);
• current source of income (e.g., welfare, Employment Insurance Benefits, WSIB benefits, CPP benefits, pensions, rental property income, investments);
• current expenses (e.g., rent, mortgage payments, car payments, family support, child care);
• available statements from a financial/credit counselling agency, and;
• whether you have declared bankruptcy, are in the course of bankruptcy proceedings, or have had a discharge in personal bankruptcy.

How Will WSIB Recover a Benefit-Related Debt?

If you receive future benefits from WSIB, such as:

• future economic loss payments,
• non-economic loss payments, or
• loss of earnings benefits,

then WSIB will deduct at least 20% of the amount from such payments.

The deduction may increase up to a maximum of 100% if evidence shows that increased deductions will not interfere with your ability to maintain ongoing expenses such as:

• food,
• mortgage or housing, and
• insurance premiums.

WSIB will fully recover debts through deduction from lump sum payments, unless doing so would threaten your ability to maintain your residence, perform work or maintain a livelihood.

WSIB may start a court action to recover the debt.

Can You Negotiate a Payment Plan?

Yes. Whether or not you expect to receive future payments from WSIB, you may negotiate repayment arrangements. If you do not expect future payments from WSIB, the WSIB anticipates that payment of the benefit-related debt will be made out of your personal funds.

Can You Appeal a Decision Regarding a Benefit-Related Debt?

For debts resulting from payments made on or after January 1, 1997: You do not have a right to appeal the WSIB decision to an Appeals Resolution Officer (ARO) nor to the Workplace Safety & Insurance Appeals Tribunal (WSIAT).

However, if you believe that WSIB’s decision regarding the creation of a benefit-related debt; the amount of the debt; or the way WSIB will recover it; is incorrect, you may ask for a reconsideration from the person who made the decision.