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N.B. Workers’ Compensation Rate Rises For Third Year In A Row

WorkSafeNB president and CEO Douglas Jones. (Image: Cherise Letson/Huddle Today)

SAINT JOHN – WorkSafeNB will be increasing the assessment rate charged to employers for the third year in a row, the Crown corporation announced Thursday.

The 2019 average assessment rate will be $2.92 per $100 of payroll compared to the 2018 rate of $1.70.

WorkSafeNB says the high assessment rate is being driven by the increasing costs of workers’ compensation claims, which have doubled from $199 million in 2014 to a projected $400 million in 2018. Future liabilities, which are the funds required to pay for all future claim costs related to a current year injury, also increased by $800 million during that same period.

Douglas Jones, the president and CEO of WorkSafeNB, says these increases are not due to an increase of workplace injuries, but longer claim durations. He says this is an unintended consequence of legislation passed in 2015. That legislation established an independent, external appeals tribunal, which is consistent with other provinces. However, the legislation also allowed the appeals tribunal to overturn board policy, which he says binds WorkSafeNB in all matters.

“The appeals tribunal, when they’re looking at a single case, they’re making their best decision based on the information that they have. But the way the legislation was written is that their decisions on that can then affect hundreds or thousands of other cases in ways they never envisioned,” said Jones, in an interview with Huddle. “Some of those unintended consequences that we’re seeing from that is we’re ending up with people that are receiving worker compensation benefits for injuries or illnesses that do not have anything to do with a workplace injury.”

In May 2017, the province’s Minister of Post-secondary Education, Training and Labour appointed an independent task force comprised of both workers and employers to review New Brunswick’s workers’ compensation system. Its report was released in July 2018 with 28 recommendations, including proposed legislative changes that have all been endorsed by WorkSafe NB. Within those 28 recommendations are changes that would not only help injured workers but also bring assessment rate back down.

“In a nutshell, it’s returning the jurisdiction or the authority for policy back to the board. That’s really the biggest thing about rates,” said Jones. “There are also recommendations in there that are designed around improving safe work practices, such as removing the unpaid three-day waiting period. Those are important for different people because it’s a balanced system. It’s not just employers. We have to consider employers, injured workers, and their families.”

The rate increase was unwelcome news to much of the province’s business community, who have voiced concern about the skyrocketing rates over the past several years.

“These new costs have nothing to do with increases in workplace injuries and everything to do with a system out of control.” said Louis-Philippe Gauthier, the Canadian Federations of Independent Business’s (CIFB) director of provincial affairs for New Brunswick, in a release. “Businesses owners are frustrated and understandably angry. They have no ability to fix what is happening to the workers’ compensation system and yet are forced to pay the bill for a mistake government made in 2015.”

CFIB is calling on the newly elected provincial government to act on the task force’s recommendations.

“All members of the new legislative assembly have an opportunity to collaborate and fix this by acting quickly on the recommendations of the task force,” said Gauthier. “If our MLAs fail to act now, the damage done to the Workers’ Compensation System will be measured in decades instead of years and inevitably will lead to reductions in benefits for injured workers.”

Jones said WorkSafeNB has met with the incoming provincial government led by Progressive Conservative leader Blaine Higgs to discuss the proposed legislative changes.

“In the last few days, we’ve been spending time with the MLAs. We’ve met with the PC caucus and premier-elect Higgs and are very encouraged that they quickly understood the magnitude of the problem,” said Jones. “I’m very confident that they’re going to do everything they can to work with us on the legislative changes so we can get the benefit of those as soon as possible and hopefully start turning this in a better direction.”

Meanwhile, he said he’s sympathetic to what this new increase is going to cost businesses.

“I just can’t imagine the challenges that some of the employers are going to go through,” Jones says. “I would ask their support in endorsing the task force recommendation and helping us get those through as quickly as we possibly can because that’s what’s going to make the most immediate and long-term changes and improvements in the system.”