Ontario Labour Critic calls for Competition with WSIB

One might assume legislation that makes a Canadian WCB the exclusive workers’ compensation provider would extend some certainty to that status. Recent developments in other jurisdictions could dispel that assumption.

A few years ago, West Virginia was an exclusive state fund workers’ compensation insurer. Today, it faces competition from private insurers in that state. The New Zealand Accident Compensation Corporation is about to have its exclusivity removed for the workers’ compensation portion of its mandate.

Ontario’s Workplace Insurance and Safety Board (WSIB) has been under financial pressure for some time. It currently has an unfunded liability of about 47%. In other words, WSIB has about half (53%) the money it needs to cover the liabilities—the health care, permanent disability and other benefits injured workers are entitled to.

The way out of this hole is not easy. Clearly, reducing the number and severity of workplace injury and disease cases is part of the solution but unlike BC, which has the main legislated responsibility for occupational safety and health, WSIB is only one player in the prevention role. The Road to Zero strategy requires substantive and continuous reductions in the injury rate in order to have any impact on the unfunded liability.

Other options for WSIB include increasing premiums and cutting benefits. With current premiums among the highest in Canada, there is little appetite for any increase in premiums. In a sense, employers in the WSIB system are already experiencing an intergenerational transfer of costs. The unfunded liability of today is predominantly a result of injuries that occurred in the past. Slashing benefits would clearly hurt those who already are bearing the entire human and much of the financial costs of work-related injury, illness and disease.

What about improving the return on investments? As every investor knows, investments that offer higher returns carry increased risk of large losses. With market volatility and economic uncertainty the way they are today, becoming more aggressive with investment strategies is probably not a great idea.

Recently, the Labour Critic for the Official Opposition in the Ontario legislature introduced a private members Bill to open WSIB to competition. Randy Hillier, who recently sought to lead the Progressive Conservative Party of Ontario, saw his Bill 219 debated in the legislature on November 19, 2009. An explanatory note contained in the Bill states:

The Bill amends the Workplace Safety and Insurance Act, 1997 to allow an employer, at any time, to opt to participate in an insurance plan that is offered by a private-sector insurer, instead of the insurance plan established under the Act, if the alternate plan offers benefits to the employer's workers that are comparable to those offered by the insurance plan as it exists under the Act as of the date that the amendments to the Act come into force. To exercise the option, an employer is required to file a notice with the Workplace Safety and Insurance Board containing the particulars specified in the regulations made under the Act.

As with most private member Bills, this proposed legislation was defeated after some debate. It is clear that the idea of opening the WSIB to competition has resonated with some. While research would suggest that competitive workers’ compensation systems are, on average, higher cost for employers, it is likely that the large unfunded liability in Ontario will keep this issue alive for some time to come.

Ergonomic Considerations for Older Workers

The idea of fitting the job to the worker is not new...but the increasing numbers of older workers in the workforce requires a fresh look at workplace standards and design.

Older workers may have very different needs from their younger counterparts. Many tables that record body measurements and ratios are based on military populations and may not be representative of the working population in general or of a particular worksite with many older workers.

What sort of considerations should one make for older workers? In a recent presentation J.M. Haight offered the following advice:

Consider older workers limitation in workspace and task design:
· Improve illumination
· Reduce heavy lifts and elevated work
· Design smooth solid flooring
· Remove control panel and computer screen clutter
· Reduce noise levels
· Focus on error reduction tools such as three way communication
· Additional time spacing between task steps
· Increase decision making time
· Reduce necessary reaction time
· Understand accommodations being made
· Educate, Educate, Educate

The Australian Public Safety Commission produced a similar
checklist of strategies and activities for an aging workforce
(Australian Public Service Commission, 2003):

Improve work task design
· Promote employees’ control over their work depending on agency needs and employee preferences
· Reduce physical loads
· Ensure good visibility of task-related information
· Improve posture
· Set reasonable work rate standards, production targets or workloads

Improve job design and work organization
· Avoid monotony, short cycle times
· Improve work scheduling
· Allow flexibility in taking rest breaks
· Allow individuals time to adapt to new tasks
· Support flexible employment conditions

Improve the physical work environment
· Minimise glare
· Ensure good lighting levels
· Minimise noise levels
· Eliminate hazards that may cause slips, trips and falls
· Make allowances for working in heat and encourage sun-safe behaviour

Support and improve people’s performance capacities
· Develop best practice performance standards
· Improve training programs
· Develop and maintain support systems
· Improve employee morale and expertise

Interestingly, this resource follows each strategy with specific recommended activities and provides a small bibliographic reference section to support each recommendation.

Zurich, another large insurer, recently published an even more elaborate listing of practical steps (Zurich Services Corporation, 2008). The listing includes engineering and administrative solutions for physical, physiological and psychosocial changes.

With same level falls (slips, trips and falls) identified as a major source for injuries in older workers, the slips, trips and fall prevention program evaluated by Bell et al. (Bell, J. L., Collins, J. W., Wolf, L., Grnqvist, R., Chiou, S., Chang, W.-R., et al. Evaluation of a comprehensive slip, trip and fall prevention programme for hospital employees. Ergonomics , 51 (12), 1906-1925) is a good resource for ergonomic strategies that have collectively been validated in a healthcare setting. The main intervention strategy elements are:

· Keep floors clean and dry
· Prevent entry into areas that are contaminated
· Use slip-resistant shoes
· Keep walkways clear of objects and reduce clutter
· Provide adequate lighting in all work areas including outdoor stairwells and parking garages
· Secure loose cords, wires and tubing
· Eliminate outdoor surface irregularities
· Eliminate indoor surface irregularities
· Check stairs
· General awareness campaign

There are other resources like Designing for Older Adults: Principles and Creative Human Factors Approaches is one such reference (Fisk, Rogers, Charness, Czaja, & Sharit, 2009). Another is “Extra-ordinary” Ergonomics: How to accommodate small and big persons, the disabled and elderly, expectant mothers and children (Kroemer, 2006) where Chapter 6 is specifically about designing for aging.

These general guidelines and resources are a start. For any particular jobsite, safely fitting the actual job tasks to the the workers who actually perform them deserves consideration.

Ergonomics and Demographics

Last week I completed a graduate course on Ergonomics (OCCH 505b offered through the School of Environmental Health at the University of British Columbia). The class consisted of about a dozen students, mostly working towards a Master of Science degree in Occupational and Environmental Hygiene. The instructor was a professional ergonomist with a great background in academic, regulatory and private practice areas. The content and discussions were a great way to spend three hours every Monday evening over the last three months.

The course content covered the range of topics you might expect and a few that might not immediately jump to mind. One area we discussed was how the changing demographics of society and the labour force will require ergonomic considerations for older workers.

Demographic changes are clearly having an impact in the labour force. The average age of workers in the labour force is rising. More people are deciding to participate in the labour force well beyond the age of 65. In the US, most of this population is opting for full time work—a clear shift from the trends we saw only a decade ago. Despite these trends, there was surprisingly little research-validated data on specific ergonomic recommendations for the older workforce.

There is no standard definition of what we mean by older workers. In some research, particularly in manufacturing and construction, age 40 or 45 is used to differentiate the older worker population. In other literature, workers over the age of 55, 64, or 67 may be used to define the older population.

The research lists changes that occur to our body and mind as we age. Not everyone ages at the same rate but many common changes are important to consider when designing or fitting the job to the worker:

• 
  · stiffness Increases
  · range of motion and flexibility decrease
  · Hearing declines particularly at upper frequencies
  · metabolism slows and weight gain often occurs
  · tire more easily and take longer to recover
  · eye movements may become impaired
  · colour perception may change
  · more light may be required for fine work tasks
  · floaters and veils can appear and persist in the field of vision

Not everything about aging is bad. Some things improve with age. These include verbal and general knowledge. Age is associated with increased happiness. A recent study found a positive association between age and safety perception. Older workers have the best perceptions on safety, highest job satisfaction levels, greatest compliance with safety procedures and recorded the lowest work-related accident/injury rates.

Some researchers and insurers are beginning to provide important information for the protection older workers. I’ll provide some resources in my next post

Workers' Compensation and Social Security Disability Insurance

I spent part of last week in Washington, DC at a seminar sponsored by the National Academy of Social Insurance and the U.S. Social Security Agency. The seminar focused on the fact that many of the clients served by both workers’ compensation (WC) and social security (SS).

My role in the conference was to provide a Canadian perspective and some insights into how Canadian public policy makers are dealing with the overlap between workers’ compensation and social security. More importantly, my hosts were interested in the innovations Canadians are bringing to the return-to-work priority both systems share for the clients who may be able to overcome the barriers to gainful re-employment in the labour force.

The research is pretty clear: early intervention improves return to work outcomes. Typically, access to services to assist in an early return to work (RTW) is more associated with workers’ compensation than Social Security Disability Insurance (SSDI) or Canada Pension Plan-Disability (CPP-D). Consequently, public policy that increases the scope of coverage for WC tends to increase access to programs and services of this population that would not otherwise have such access. Since many of those who are outside the scope of WC coverage (for example, some jurisdictions exclude, domestic workers, out-workers, farm labourers and self-employed from coverage) are workers who may have limited access to alternative employment, any expansion of WC coverage that includes these populations has the potential to help some of the most vulnerable workers return to work.

In my presentation, I noted that some jurisdictions have mandatory reinstatement provisions in their WC legislation. These provisions require an employer to take an injured worker back to employment. Some jurisdictions go further and require the employer to accommodate the worker to the point of “undue hardship”—a significantly higher test than mere ‘reasonable accommodation’. The big stick of legislation is not unique to some Canadian jurisdictions. Many Australian jurisdictions, for example, require employers to return injured workers to employment.

Since WorkSafeBC’s legislation contains no direct mandatory reinstatement provision, other approaches are emphasized. For example, WorkSafeBC offers a rebate of premiums to employers who qualify for a Certificate of Recognition. After substantiating through an audit that a firm has a prevention program in place that exceeds the regulatory minimum and has an injury management/Return to Work program in place, the firm may qualify for a 15% rebate. This can provide a substantial carrot to get and keep the attention focused on primary prevention and disability management that may help all workers—not just those who may suffer a work-related injury.

In the question and answer session, I was asked how WorkSafeBC is financed and how this compares with the typical US workers’ compensation insurer. I noted that WorkSafeBC is the exclusive insurer of work-related injury, the sole adjudicative authority, policy maker, workplace health and safety regulator and inspectorate for the province (like OSHA in the US). WorkSafeBC is funded by premiums that average about $1.56 per $100 of assessable payroll and that premium covers all WorkSafeBC’s functions (in the U.S., the quoted base or book rate may not reflect assessments or levies that finance research, oversight, appeals, and state-OSHA costs).

In follow-up questions, I was asked what I meant by assessable payroll. In many places, workers’ compensation rates apply to total payroll as opposed to the limit WorkSafeBC and most other Canadian WC boards place on payroll per person (currently $68,500). If we stated WorkSafeBC’s premium in terms of total payroll, we estimate the rate would come in at about $1.33 per $100 of payroll.

It was clear from the interest expressed in questions both during and following the session that many of the researchers in the audience were intrigued with the apparent low cost, relatively high benefits and strong return-to-work outcomes achieved in British Columbia for our workers and employers. If you are interested in seeing the presentations from this event, you will find them posted on the past events section of the NASI.org site...look for the November 18, 2009 seminar listing.

What does Workers’ Compensation owe Francois Bareme?

Every workers’ compensation system has some way of deciding what payment a worker should receive for permanent disability. Some systems are based on impairment or non-economic loss while others are based on disability with its implied economic loss calculated in some manner or other. Still others are based on a combination of the two concepts. Commonly in workers’ compensation, schedules of disability exist that relate impairment or disability to some standard. In Canada, we might refer to these as Disability Schedules. In several European sources, I noted that these schedules were called “Baremas” . I wondered about the origin of the word and was fascinated by what I found.

In medieval times, Germanic law related the loss of an arm or an eye to the ‘wergeld’ or ‘manngeld’, the compensation that was to be paid to the family for the killing of a free man. Even pirates had schedules in the articles that governed their enlistment. In Under the Black Flag: Exploits of the most notorious pirates, Don Carlos Seitz lists the articles from a 1723 voyage under Captin John Phillips; one article reads:

If any Man shall lose a Joint in time of Engagement, shall have 400 Pieces of
Eight; if a Limb, 800.

Enter the French mathematician, Francois Bareme [or Barreme] (1638?-1703). He created and published many mathematical tables for ease of use and consistency in commerce. The French word for a ready-reckoner, barême or barrême, is a reference to him. Bareme took the sums that were commonly used for the loss of body parts and restated them as a percentage of the compensation that would be granted for compensation for the death of a free man. Subsequently, such listings of body parts and percentages in many personal injury compensation schemes became known as Baremas. Today, the most complex Barema would be the AMA Guides. In Spain, the Baremo, as it is known, is a mechanism that allows users to consistently evaluate bodily injury and assess compensation for victims of motor vehicle incidents (for permanent disability systems, it uses a point system to calculate a rating from 0 to 100 that determines the compensation).

The scale and method of calculating compensation varies with the barema used and the jurisdiction. I recently wanted to know how various systems might rate the loss of an eye. Since some jurisdictions are not limited to just workers’ compensation, these may not be strictly comparable but I thought the variation was interesting. In WorkSafeBC’s Permanent Disability Evaluation Schedule, and industrially blind eye is evaluated as a 16% disability, enuculeation at 18%. In Belgium, total loss of vision in one eye is rated at 30% disability. The English Barema uses 40% while the French use 25% and in Iceland, the loss of vision in one eye is rated at 20%. There is even a wide variation in Scandinavia with the loss of vision of one eye rated at 20% in Denmark and Norway and 14% in Sweden while the actual loss of one eye is rated at 20% disability in Denmark but 25% and 17% in Norway and Sweden respectively.

Of course, the final result for the injured worker will be based on more than a percentage of disability. A low percentage of a high wage rate may provide a greater benefit than in a system where the maximum wage rate is pegged at a low level.

There is no one right percentage of disability to apply in this example. What is right for one jurisdiction is not necessarily right for another. The impact of the loss of an eye in one society (and its related economy) may be quite different than in another. That said, the equity is critical. Bareme’s intent in creating tables was to standardize and eliminate error—a goal that still applies today.

Workers' Compensation and a Uniform or Flat Assessment Rate?

I received a call last week about funding workers’ compensation systems. The caller asked why we don’t just charge one rate for all industries. For those of us in North America or Australia, this notion may seem odd since our systems all have different rates for different industries based on some sort of classification system. On the other hand, those covered by Canada Pension Plan-Disability or Social Security Disability Insurance in the US are familiar with the idea of a single contribution rate paid for an insurance. For workers without workers’ compensation coverage, CPP-D or SSDI may be the only insurance they have for work-related injury that precludes them from earning. Is there any good reason for having assessment rates that varies by industry? Are there any advantages to having a single rate system?

First, let’s talk about the rating systems we have. In BC, the average WorkSafeBC assessment rate (premium) is $1.56 per $100 of assessable payroll. Industries with higher costs pay more: Heavy construction, steep slope roofing, steel frame erection are at the high end, around $12 while financial institutions, computer software design and production pay between $0.08 and $0.13 per $100. Having a rate structure has implications. There are costs for creating and monitoring the classification system, assigning firms to various classification units and managing the inevitable conflicts that can occur as a business changes or argues that it should be classified in a (usually lower) classification.

A single rate system, on the other hand, requires none of these costs. Canada Pension Plan contributions are calculated as a simple tax on payroll (currently the employer and the worker each pay 4.95% of earnings for CPP). That’s it. Simple. But is it fair? In one sense, it is equal treatment for all and for non-work related causes of severe and prolonged disability, it likely is fair. Each of us bears a risk for serious disease that could debilitate us from work so it makes sense that all should share equally in the cost.

Doing the same for a workers’ compensation scheme has been proposed. Sir Owen Woodhouse proposed a flat rate for employers for their part of the New Zealand Accident Compensation scheme back in 1967. In defense of Woodhouse, his concept extended well beyond work-related injuries and in the context of a no-fault universal scheme of social insurance, the uniform rate idea is attractive.

I am unaware of any system in Canada, the US or Australia that have implemented a flat rate system. In Canada, the issue of a uniform assessment rate was considered by Sir William Meredith who writes:

It is the purpose of my draft bill to empower the Board in determining the roportions of the contributions to be made to the accident fund by employers to have regard to the hazard of each industry, and to fix the proportions of the assessments to be borne by the employer accordingly, and not to require that the proportions for each class or sub-class should be uniform…

So, in practice, workers’ compensation systems use classification systems that result in different rates being assessed for different industries according to ‘hazard’ which includes the human and financial costs associated with the wage structure, frequency and severity of injuries that occur within an industry. A uniform rate, it may be argued, would be tantamount to a subsidy. In the BC example noted above, a uniform assessment of $1.56 would be very attractive to steep slope roofers and would be a significant cost burden to financial institutions whose assessments would be used to offset the costs in sectors where injuries were more frequent and/or costly.

Similar arguments apply within sectors and are often used as a justification of experience rating or rate modification…but that is a discussion for another day.

Seasonal Agricultural Workers and Workers' Compensation

Last week I attended a symposium on health and safety issues for farm workers with a focus on those entering under the Canada as Seasonal Agricultural Workers Program (SAWP) from Mexico. I have been tracking the workers’ compensation issues raised by the entry of British Columbia into this program about five years ago.

What we know about this group of workers is that they are vulnerable on several levels. Language, culture, limits on the ability to meet with others in the community, long hours, fear of removal, limited knowledge of rights, isolation due to location are but a few of a long list of factors that make this population among the most vulnerable of workers. While these workers have the same rights under workers’ compensation laws and the Occupational Safety and Health Regulation, fully exercising those rights may be hindered by the these factors.

What we heard from the researchers confirmed what we already know: many temporary foreign workers are reluctant to report injuries and violations of the Regulation. Addressing the factors that contribute to this situation isn’t easy but is important.

Letting these workers know about their rights isn’t simply a matter of sending out a booklet or posting a page on the internet (although these actions help to some degree). Unlike other worker populations, workers under SAWP, other programs or even working without legal authority will, by definition, tend to be ‘new’ workers (new to Canada, new to the jobsite, new to tasks they will be performing). As we know from other research, newness itself increases risk (see IWH brief on this topic). Finding ways to better address the needs of this vulnerable group will be a growing challenge as the number of workers in this category increases.

In other forums, I have heard about innovative practices and approaches to serving agricultural workers, particularly temporary foreign workers from Mexico. In Washington state, Spanish radio vignettes have been designed and broadcast with plot lines and dialogue that mirror health, safety and compensation rights. In Ontario, all SAWP are covered by the provincial medical plan (OHIP) without the typical waiting period. In BC, WorkSafeBC and FARSHA have developed materials, delivered training and increased services designed to reach these workers on jobsites throughout the province.

One additional point came out of the symposium that is worth noting. The general category of ‘farm worker’ includes several vulnerable worker types. Canadian citizens and permanent residents may be subject to the same language and cultural barriers as workers under the SAWP groups (Mexico and the Caribbean); Refugee claimants with authority to work will have additional barriers as will other workers who may have no legal status at all in Canada. For the sake of all these vulnerable workers, new approaches may be necessary to educate these workers about the workplace risks they face, how to protect themselves and how to exercise their rights, protections and compensation.