Injured workers in B.C. will likely get millions more in compensation as a result of new legislation the government says is meant to “rebalance” the province’s supports for people hurt on the job.
Labour Minister Harry Bains said proposed amendments will bring “overdue” changes to the province’s worker compensation system, including a provision to index injury and pension benefits to inflation, up to four per cent.
The change is part of a suite of legislative reforms to the Workers Compensation Act that Bains introduced this week that he says should be passed in the last days of the fall legislature session.
Workers’ groups are heralding Bill 41 as an incremental gain that responds to years of reports highlighting problems in WorkSafeBC, which manages the province’s compensation system for those injured on the job.
“I believe people injured on the job need to know there is a workers compensation system that meets their need,” Bains said in an interview.
The change comes 20 years after the former BC Liberal government passed legislation that set payment increases at one per cent less than increases in the consumer price index, guaranteeing workers would see the purchasing power of those benefits erode each year.
If the bill passes, the payments would instead be indexed to the consumer price index up to four per cent. In the event inflation is higher than four per cent, WorkSafe would set a figure between four per cent and the actual inflation rate.
BC Federation of Labour president Laird Cronk said injured workers depending on compensation payments had seen their lives become more difficult.
“They were one per cent less than the cost of living every year,” he said. “They’ve been falling behind for more than a decade.”
A 2018 review by consultant Terry Bogyo said that change by the BC Liberals resulted in $584 million less being paid in pensions and compensation to workers from 2002 to 2017 cumulatively.
Bains and WorkSafeBC have not said what the improved benefits would cost.
Greg Wilson, B.C. government relations director for the Retail Council of Canada, said he does not necessarily oppose that change but wants to see full costing. He’s concerned a major increase in payments could require WorkSafeBC to hike the premiums that employers pay to fund it.
“It’s hard to know whether to be in favour or opposed to this because we don’t know what it costs,” Wilson said.
WorkSafeBC is funded by premiums paid by employers, which are currently set at an average of 1.55 per cent of an employer’s accessible payroll. Sectors with higher injury rates pay more.
The base rate has not changed since 2018 and will remain in place for 2023.
The actual cost of compensation paid by WorkSafeBC, though, is 1.76 per cent of payroll deductions.
WorkSafe has made up the difference thanks to revenues from its $23-billion investment portfolio, which Bains says has effectively subsidized employers’ costs.
The organization’s 2021 investment revenues totalled more than $2.4 billion; in comparison, it received less than $1.9 billion in premium payments.
Wilson worries those investment returns may dwindle as many warn the economy is heading for a recession.
But Bains says WorkSafe has been indirectly subsidizing employers and has the money to spend on improved benefits.
“There is a surplus in the accident fund,” Bains said. “The board has the authority to lower the premiums for the employers, which they have been doing because employers are not paying the true cost of claims for a number of years now.”
Bill 41 also contains other changes recommended to government in a series of reports it has commissioned on the workers’ compensation system since 2018.
The law, if passed, creates a legal obligation for employers with more than 20 staff to return injured workers to the same job they had before, or the closest thing to it, with few exceptions.
It would establish a commission within WorkSafeBC to investigate allegations of unfairness in the compensation system, and it would give workers and employers the right to request doctors and other independent medical experts to offer an opinion during compensation appeals.
The law would guarantee that WorkSafeBC pays interest on payments to workers that they have been owed for 180 days or more.
And it would enshrine penalties for employers who try to “suppress” workers from submitting injury claims, including by firing them.
“Many workers, particularly precarious workers, if they file a compensation claim, they find themselves fired,” Janet Patterson said.
Patterson is a retired labour lawyer and the author of an exhaustive 517-page review on the province’s compensation system, which she submitted to government on Oct. 30. 2019, exactly three years and one day before Bains introduced the legislation.
She and others welcome many of the changes but wonder why it took so long.
“Don’t confuse that with us not welcoming the change. We do. But it did take longer than it should have,” Cronk said.
The Patterson report, the first full review of the act since 2003, found the board had shifted to an “insurance” model where workers with complex needs and injuries were repeatedly falling through the cracks.
The BC Federation of Labour, which represents more than 50 unions and more than half a million workers, has long lobbied for an overhaul of the province’s compensation system after changes introduced by the BC Liberals in the early 2000s.
Cronk said Bill 41 takes positive steps but he wants to see more action from government to expand compensation. He says the extra cash in WorkSafe’s accident fund is the sign that more can and should be paid out.
“It’s not a surplus. It’s money that should be going towards helping workers, and what they did is they removed the ‘worker help’ part of it,” Cronk said.
Bains defended the delay in introducing the changes, saying government wanted to avoid putting extra pressure on employers during the economic disruption wrought by the COVID-19 pandemic.
“What we are looking at right now is, what is the right balance? We’re looking at the employers’ needs to make sure they’re not overburdened right as they come out of the pandemic,” Bains said. Government continues to consider the other recommendations in the Patterson report, he added.
Cronk, whose term as president ends this month, hopes more of its recommendations soon become law.
“It’s not a radical change. It’s an appropriate change,” Cronk said.