Permanent Impairment (NEL Benefit - accidents after January 1, 1990)
What is a non-economic loss benefit?
In short, the non-economic loss benefit, also referred to as a NEL award, is a provision in the Workplace Safety & Insurance Act (WSIA) that provides the WSIB with the authority to compensate you with a monetary payment if you have not fully recovered from the affects of your work injury or illness.
The basic elements
The NEL process is very complex and difficult to understand even for seasoned professionals. With this premise, our Settlement Kits pertaining to the NEL entitlement provisions were created to provide you with the right tools to effectively address any issues you may have with respect to your NEL entitlement.
If you want a more in depth understanding of the NEL provisions within the WSIA, we are providing them here with links to the WSIB website specifically dealing with this matter.
If you have a permanent impairment due to a work-related injury or illness, you are eligible for a NEL benefit under Section 46 of the Workplace Safety and Insurance Act, 1997 (WSIA). The WSIB pays you a NEL benefit when you have an ongoing impairment after your work-related injury or illness has reached a point where it is not expected to improve. This point is called the maximum medical recovery date (MMR). The WSIA defines “permanent impairment” as a physical or functional abnormality or loss (including disfigurement) which results from an injury and any psychological damage arising from the abnormality or loss that continues to exist after you reach MMR.
A NEL benefit is not related to any loss of earnings benefit you may be receiving and it is not related to your ability to work. The NEL benefit you receive is only for the impairment resulting from your work-related injury or illness.
How the WSIB decides the degree of your permanent impairment?
To determine the degree of your permanent impairment, the WSIB has a team of registered nurses who have extensive training and expertise in the evaluation of permanent impairments review your claim. In the WSIA it says we must use the evaluation criteria set out in the American Medical Association Guides to the Evaluation of Permanent Impairment, Third Edition, Revised when the WSIB decides the degree of your permanent impairment. The WSIB also uses policy and/or supplementary practice guidelines for your specific impairment diagnosis, all relevant health- care information in your file and, if needed, a report from an independent medical assessment.
Once the WSIB decides the degree of your permanent impairment for the specific area of your injury or illness, they determine the “whole person impairment” percentage. This percentage is the degree that your whole body is impaired as a result of your work-related impairment.
For example, a complete amputation of the index finger represents a 100% impairment of the finger. The 100% impairment of the finger represents a 20% impairment of the hand. The 20% impairment of the hand represents an 18% impairment of the arm, and the 18% impairment of the arm represents an 11% impairment of the entire body.
How your NEL benefit calculated?
The WSIB decides the dollar value of your NEL benefit by multiplying your whole person impairment percentage by a base dollar value. The base dollar amount is set out in the WSIA. To calculate a NEL benefit, the WSIB uses the base amount for the year you reached maximum medical recovery. This base amount is then adjusted according to your age at the time of your injury. There is an age adjustment amount that is added for every year you were under the age of 45 at the time of the injury, or subtracted for every year you were over 45, up to a maximum of 20 years.
Example of a NEL benefit calculation
Let’s say that you were 52 years old at the time of injury (7 years over age 45) and you reached maximum medical recovery in the year 2018 . The base amount for people whose maximum medical recovery date is in 2018 is $59,981.69 , and the adjustment amount is $1,333.42 . As a result, the WSIB reduces the base amount of $59,981.69 by the age adjustment factor of ($1,333.42 x 7) to get the adjusted base amount:
$59,981.69 - ($1,333.42 x 7) = $50,647.75 (adjusted base amount)
The WSIB multiplies the adjusted base amount by your whole person impairment percentage to calculate your NEL benefit. If your whole person impairment is rated at 15%, your NEL benefit is:
$50,647.75 x 15% = $7,597.16
Now let’s say you were 40 years old at the time of injury (five years under age 45), the base amount of $59,981.69 is increased by the adjustment amount of ($1,333.42 x 5) to get the new base amount:
$59,981.69 + ($1,333.42 x 5) = $66,648.79 (adjusted base amount)
Using the adjusted base amount, your NEL benefit is: $66,648.79 x 15% = $9,997.32
How the WSIB pays the NEL benefit?
The NEL benefit is paid as a lump sum or monthly payment depending on whether the benefit amount is under or over an established threshold, and in some cases, on the payment option selected by the person.
The NEL benefit threshold is set annually. The threshold for each person is based on the year the person reaches maximum medical recovery. For a complete list of the NEL benefit threshold amounts to date, see WSIB Policy 18-01-02, Benefit Dollar Amounts - Accidents from 1998 and Policy 18-01-03, Benefit Dollar Amounts - Accidents before 1998.
If NEL benefits are at or under the threshold, the WSIB automatically pays it as a lump sum. If the NEL benefit is over the threshold, the WSIB automatically pays it as a lump sum after 30 days unless you choose to have the benefit paid monthly. If you are eligible to choose a monthly NEL benefit payable for life, you have 30 days from the date of the decision letter to decide the method of payment. According to the WSIB, once the method of payment is decided, it can’t be changed.
What if your condition gets worse?
The WSIB can review your NEL benefit if your work-related impairment has significantly and permanently worsened, and if 12 months have passed since your last NEL loss decision. This review is called a NEL redetermination. Click the SETTLEMENT KITS link below for our NEL Redetermination Kit to help you request a redetermination of your NEL benefit.
Whether your workplace injury or illness was 30 years ago or recently, we have both the expertise and the tools to help you.
Have a look at our WSIB Settlement Kits page, you will likely find one that addresses your issues. If there isn't one, just send us an email describing your problem and we will do our best to create one for you!