Employers in Ontario are anticipating a significant change in the workplace injury insurance system.
Broadly speaking, we at Isthmus Legal recommend that employers in Ontario focus on four main areas with respect to these changes:
Change 1: Employer Classification System
The WSIB is considering streamlining the employer classification system for Schedule 1 employers in Ontario.
Change 2: Premium Rate Changes
Corresponding with the changes to the employer classification system, employers can anticipate changes to their WSIB premium rates. This will likely take two significant forms: the base industry premium rate, and the individual experience-rated premium rate charged to employers.
Change 3: Experience Rating Changes
The current proposed changes include the elimination of the three main collective liability experience rating programs – MAP, NEER and CAD-7.
Instead, the WSIB is proposing a completely new approach to funding the insurance program, switching from a retrospective approach to a prospective approach when assessing employers’ claim costs and rebates or surcharges.
Change 4: Claims Management Approaches
As the methodology related to the cost impact of claims changes, it is likely that employers in Ontario will have to strengthen their claims management processes to adapt to the new experience rating model.
We are recommending our clients undertake the following actions in response to these proposed changes to the WSIB workplace injury insurance program:
- Ensure that payroll and employee work designations are as precise as possible. It is likely that you will require strong organizational and administrative processes to deal with the proposed classification and rate group changes.
- Stay informed. The WSIB is conducting extensive information and consulting outreach to the public (especially employers) during this program development stage. If you are able to participate in the consultation process – great. If not, find ways of keeping up with the proposed changes.
- The proposed new WSIB experience rating system appears to be an amalgam of several different jurisdictions’ best practices. Getting up to speed on British Columbia’s and New Brunswick’s experience rating systems would give you a head-start to understanding Ontario’s proposed new system.
- Focus on more than having a good return-to-work (RTW) program as your claims management system. Of course, in any new system, RTW will be very important; however, the administrative, legal and financial analysis aspects of claims management will be especially vital during this transitionary period.
- Finally, be prepared for some chaos. The current system has been in place for decades. Whatever one may think of the current system, it is well established and most, if not all, of the kinks have been worked through. Because of the comprehensive nature of these proposed changes at the WSIB, expect a certain amount of ambiguity and challenges.