WorkSafeBC recently announced that there will be rate hikes
again in 2014. This will mean that most employers in British
Columbia can expect to pay higher premium costs for the second year
in a row. WorkSafeBC projects that employers will pay an
average base premium rateof 4.8% more in 2014. This is close
to the increase employers experienced last year (5% in 2013).
In dollar terms, this means that on average, the 2014 average
premium rate will be $1.70 for every $100 of assessable payroll
(which is up 7 cents from $1.63 in 2013).
WorkSafeBC reports that the two main causes for the increase in
rates are (i) increased claims costs (largely related to an
increase in the volume of long-term disability awards, and
increasing health care costs, and (ii) poorer than expected returns
on WorkSafeBC's investment portfolio. According to
WorkSafeBC, this means that a small business with a payroll of
$500,000, with an average premium rate, will experience a rate
increase of $400 for 2014 (for an annual premium of $8,500) –
a monthly increase of about $33.
WorkSafeBC is taking $319 million from its capital reserve and
certain other accounts to keep the "required increase" in
the base premium rate below 5%. Without this subsidy, the
average base premium rate next year would be $1.85 per $100 of
assessable payroll (15 cents higher). WorkSafeBC has also
decided to limit the maximum premium increase for individual
industries to 10% for 2014 (the normal cap is 20%).
The Business Council of British Columbia ("BCBC")
issued a Business Alert noting that although this is the second
consecutive rate hike, it will be only the second year of rate
hikes in a decade. According to BCBC, British Columbia has a
good record of managing claims costs and premiums compared to most
other workers' compensation jurisdictions in Canada and the
US. BCBC also noted that employers fund the full cost of the
system and, in aggregate, paid $1.16 billion in premiums in 2012
– equivalent to about half of the total provincial income tax
payments made by businesses operating in the province.
Given that premiums amount to a significant annual payroll
expense, it is worth checking WorkSafeBC's assessment for your
organization from time to time to ensure that you have been
assessed in the right industry and that the correct claims history
has been applied.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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