The Canadian Federation of Independent Business said Wednesday that it received a letter from WCB president Guy Kerr stating the $507-million surplus will soon be distributed to registered businesses across the province.
The WCB also revealed that 135,391 employers will get a rebate due to the surplus distribution, which is the result of higher-than-expected investment income in 2014 – the average rebate per employer is $3,642.61.
However, despite the good news, employers can’t help wondering why the WCB lets such a stockpile build up.
Presently, the WCB has a targeted funded position of between 114 per cent and 128 per cent – a refund is only granted if the funded position goes over the 128 per cent threshold.
In 2014, the number climbed to 136 per cent, leading to $507 million in refunds to employers. A year earlier, $511 million in refunds were given to employers.
“With over a billion dollars being refunded in the last two years, Alberta’s Workers’ Compensation Board is sitting on a massive pile of employer money,” said Amber Ruddy, the CFIB’s senior policy analyst.
“The more that they can continue to lower premiums and keep employer money in their pockets up front is positive because then they can use that money within their businesses to promote safety and health and the things in the workplace that are important,” she continued.
Earlier this year, an internal survey found that 59 per cent of WCB members agreed the point at which the WCB provides refunds to employers should be lowered.
In a statement, the WCB defended its funding policy and said it ensures the system has enough money to pay for worker benefits both now and into the future.
“The money is distributed to the majority of registered employers, who pay 100 per cent of the workers’ compensation system,” it said. “There is a small list of exceptions, including employers who have sustained poor claims performance, or who are in contravention of the Workers’ Compensation Act.”
CFIB rep Ruddy said the refund is clearly a positive thing for employers but recommended a lower funding ratio; “Giving employers more of their money back will let them focus on growing their business, creating jobs, and investing in new and safer equipment. A funding ratio of 120 per cent, for instance, would be more than enough to fulfil benefit obligations to workers and minimize volatility of premiums.”
Officials have confirmed that registered business owners in Alberta will be receiving a Workers’ Compensation Board rebate worth more than half a billion dollars – but some critics are saying the windfall should have come sooner.