After an average increase of 33% in employer premiums for 2017, WorkSafeNB announced this fall that rates for 2018 will increase by an average of 15%. Actuarial forecasts pegged the 2018 increase at 60% but WorkSafeNB intervened and artificially lowered the employer rate by dropping WorkSafe’s funding target from 110% to 100% funded. WorkSafeNB Board policy mandates that when the funding level dips below 110%, action must be taken within eight years to bring the funding level back to at least 110%. On its own, this decision will add premium surcharges to employers.

Retail Council of Canada (RCC) continues to work with the Coalition of New Brunswick Employers to not only oppose the increases but to call for legislative change to the province’s Workers’ Compensation Act that would bring balance to the system.

Background:

In 2015, the New Brunswick government created the Workers’ Compensation Appeals Tribunal (WCAT). RCC has no issue with a legislated ability for employees to appeal workers’ compensation decisions to an independent WCAT. However, the province’s legislation has not only provided WCAT with the power to overrule WorkSafeNB decisions but with the ability to interpret and nullify WorkSafeNB policy. Further troubling is the fact that there is little in the current legislation to prevent WCAT decisions from being retroactive. WCAT in New Brunswick has more authority than is seen with appeals tribunals anywhere else in Canada. Unlike WorkSafeNB, WCAT does not have a mandate to consider the overall health of the workers’ compensation system and thus, the shortcomings of the current system are being exposed by WCAT decisions. Statistics from the past year show that appeals to WCAT have had a success rate of over 90%. Overruling WorkSafeNB decisions has quickly increased immediate and future costs to the system and thus, to New Brunswick employers.

An example of the impact of WCAT’s policy making decisions is seen in how a compensable injury or disease is determined.  For years, such a determination was based on a preponderance of evidence whereas now, there is a presumption in favour of the worker. Furthermore, the conditions affecting continuation of a loss time claim are now subject to a presumptive standard of evidence. For instance, when employees are on claim, WorkSafeNB is now allowing them to prolong their time off work due to non-compensable intervening conditions (e.g. personal conditions).

These decisions have become the driving force behind the significant increases in benefit costs. Actuarial reports show that without legislative change, significant increases in employer premiums will continue for at least the next two years. Under the current system, New Brunswick could have the second highest benefit costs in Canada by the end of 2018.

Workers’ compensation is an insurance program that must follow strict rules regarding its balance sheet and thus, there is little that can be done without a commitment from government to make legislative change.

Next Steps:

The provincial election in 2018 has regrettably turned the issues with WorkSafeNB into a game of partisan, political rhetoric. The government does not seem interested in introducing legislation that would upset the labour movement in the lead up to next year’s election. Therefore, the prospect of legislative change before 2019 is slim.

The WorkSafeNB Stakeholder Advisory Group has spent much of 2017 examining New Brunswick’s Workers’ Compensation system. The Advisory Group consists of employer and worker representatives. RCC will be appearing before the Advisory Group in November 2017 and will continue to call for legislative change.

RCC will continue to advocate on behalf of members for a workers’ compensation system in New Brunswick that is fair with predictable, affordable and with sustainable costs. Such a system is needed to protect employees, safeguard jobs and improve the business environment.

If you have any questions or concerns, please don’t hesitate to contact: Jim Cormier, Director (Atlantic) at:  [email protected] or (902) 422-4144