‹‹ Archives March 2011 - Issue 300
WSIB Funding Review Underway

The WSIB is in the midst of a ‘funding review’. This review is chaired by Professor Harry W. Arthurs. This review is intended to examine and make recommendations regarding the Board’s Unfunded Liability (UFL), reported at $11.7 Billion in 2009 and how to ‘minimize or eliminate the risk’ presented by UFL on the sustainability of the system. In this regard, the review will examine the following areas:

  • Funding
  • Premium Rates
  • Rate Groups (classification)
  • Employer Incentives (i.e. Experience Rating Plans, such as NEER)
  • Occupational Diseases
  • Benefits Indexation

In each of these areas, but especially in items 1, 2 and 4, the potential impact on employers will be significant.

The WSIB has already announced that the NEER Experience Rating plan will be expanded to a 4-year window retroactive to 2008 claims. We are informed that plans are already underway to examine the implementation of a 6-year NEER window.

It is important to note that the current review does not have the mandate to look at WSIB practices, costs, and the overall management (or lack thereof) of the organization. Further, the review will not be examining benefit levels paid to workers, controlling the cost of health care and how to make the system more efficient or effective. Instead, if these areas are deemed important, you are asked to submit your concerns to the WSIB directly. No information is provided as to whom or which department these concerns should be addressed.

It remains to be seen, but I suspect that the purpose of this review is to provide legitimacy and political cover for the substantive cost increases that employers will be asked to accept – both in premium increases and back-end costs such as surcharges. I believe that a further expansion of the NEER window is almost certain, with a 6-year window likely by 2013. With little adjudicative controls, a 6-year NEER window for all intents and purposes will result in greater costs for employers and result in chronic NEER surcharges for many companies in Ontario.

You may download a copy of the Green Paper which discusses the ‘funding review’. It is strongly recommend that employers get involved in process. The changes arising from this review will have long term implications for cost – and in some cases will impact the viability of companies in Ontario.

Getting involved in the process may require employers to request an appearance before the Panel to make presentations. Individuals are allowed 15 minutes of presentation time, whereas organizations (such as employers) will be permitted 30 minutes. Written copies of the presentations must be provided to the Committee at least 2 weeks prior to the date of appearance.

Click here for more information on the funding review and how to participate in the process.

 

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