Changes to WSIB benefits policies and Appeals procedures introduced in the last few years have resulted in a “massive cutback to injured workers’ benefits, tantamount to a re-writing of the legislation” and undermining the Meredith principles on which Ontario’s workers’ compensation is based.
The impact is causing untold damage to the livelihood and physical and mental well-being of those suffering work-related injury or illness and their families. The increase in denied claims has forced many workers onto social assistance, while those with allowed claims are receiving lower average Loss of Earnings (LOE) payments and decreases in other benefits, including health and retraining services.
Pre-existing conditions policy – looking to deny, not allow
The WSIB has fundamentally changed the original mandate of Ontario’s system – to compensate for injury. With this new policy the Board can now deny benefits by blaming disabilities on age-related “degeneration” and pre-existing conditions rather than the work injury – even if these have not affected workers’ ability to do the job.
- the accepted standard causation test of whether the work was a “significant contributing factor” in the development of the condition (workplace injury need only be a significant but not the sole factor), and
- the “thin skull rule” (take the worker as you find him/her – a worker should not be penalized because she had a pre-existing condition that did not affect her capacity to do her job but made her susceptible to greater injury than another worker).
- IWO Backgrounder. 2014, Nov. New WSIB Benefits Policies [pdf] – what led to the current cutbacks
- Injured Workers’ Consultants. 2014, Apr. 30. Submissions on WSIB Draft Policies. Toronto: IWC
- Ontario Network of Injured Workers Groups. 2014, Apr. 4. Open Letter to the Premier: re Stopping the WSIB Benefits Scandal. Kaministiquia: ONIWG
(For more resources, search the IWC Library catalogue)
Cost of Living
Injured workers have received so-called “increases” in their benefits most years since the Liberal government came to power in 2003. These are more correctly called “adjustments” for the impact of inflation because injured workers’ benefits are not increasing. Without full cost of living protection (automatic increases to match the actual rate of inflation), the purchasing power of benefits drops and injured workers’ poverty rises.
Many promises …
When the workers’ compensation system was introduced back in 1915, inflation was not an issue. By the 70’s and 80’s injured workers saw their benefits being swallowed up by inflation. Eventually the government responded, and in passing Bill 81 (1985) – with the consent of all parties – the Minister of Labour promised the right to an annual adjustment that takes into account the effects of inflation:
…The pain, the loss, the disruption and the disorientation caused to a worker and his or her family by a disabling injury is suffering enough. We should never add to this suffering the indignity of having to come cap in hand to the steps of the Legislature angrily demanding merely the protection of compensation benefits from the annual rate of inflation. From this day forward, injured workers will never again be in that humiliating position….” (Hon. W. Wrye)
Following recommendations of the Weiler report, in 1987 the Act gave injured workers 100% benefit indexation until 1995 when the government reduced protection for partially-disabled workers by use of the Friedland Formula. This currently provides half of the Consumer Price Index minus 1%.
… but injured workers are still waiting
Despite the 2003 election promises of the Liberal leader, Dalton McGuinty, that “injured workers and their dependents should not have to rely on their pensions being topped up by welfare payments..”, there have been ad hoc adjustments but no real move to full cost-of-living adjustment.
Harry Arthurs, chair of the 2012 Funding Review for the WSIB criticized this way of dealing with the impact of inflation on workers. His report “Funding Fairness” recommended restoring full indexation on a going-forward basis:
… benefits of both partially and fully disabled workers should be increased annually by 100% of the annual increase in the Consumer Price Index. (p.102)
This has not happened.
- IWO Fact sheet. 2013. No Minister, The Real Facts about Injured Worker Benefits
- Robert Storey. 2007. No More Cap in Hand: Cost of Living as a Right. Toronto: Bancroft Institute (IWHP bulletin, no. 3)
(For more resources, search the IWC Library catalogue)
Phantom wage for a phantom job…
What if your injury has left you with a permanent injury that prevents you from returning to your former job? If you are unable to find a suitable job, the Workers’ Compensation Board (WSIB) will “deem” (pretend) you have a job. The Board can then reduce or eliminate your benefits by deeming you to be receiving the wages from a job that you do not have and have no real hope of getting… According to the “2012 Canadian Survey on Disability” the employment rate for workers with disabilities is 49%.
Deeming or dreaming?
Most Ontarians are not aware of how we treat injured workers who have a permanent disability. When legislation in 1990 ended the system of life-long pensions for life-long disability, the government claimed it would be better for injured workers as compensation would now be based on their “real-life situation”. Unfortunately this was not the case.
Instead of looking at what the injured worker is actually able to earn in suitable and available employment, the Board deems (or dreams) most injured workers to have returned to full time well-paid employment after their injury, regardless of the worker’s actual reality. The real-life situation for many low wage earners is that they end up with little or no compensation and no retraining.
Although Labour Minister Steve Peters introduced changes in Bill 187 (2007) that he said would eliminate deeming, the WSIB has in fact since expanded deeming by inventing the concept of “underemployment”. This means that even if a worker can find a job in the field he or she has been retrained for, the Board can still ignore their actual wages and deem them to be earning more than they actually do, if it thinks there is higher paying work out there. The 72-month “lock-in” provided some protection by accepting that after 6 years of permanent disability, the injured worker’s earning situation was not likely to improve and so at that point benefits would no longer be reviewed. That too, is now being targeted – if eliminated, the damage done by deeming to injured workers’ livelihoods and mental health will each new levels.
Contributing to worker poverty
Under deeming, injured workers unable to get a job and unable to live on their compensation benefits are being forced onto social assistance in increasing numbers. In 2009, there were 6,883 families on social assistance in Ontario because their workers’ compensation benefits were below the welfare line.
- IWO Fact sheet. 2017. Injured Workers are Part of the Fight for $15 and Fairness.
- IWO Backgrounder. 2014. Deeming and the lock-in [pdf] – [Word version]
- Thunder Bay & District Injured Workers’ Support Group. 2013. “Minimum Wage Discussion in Thunder Bay.” NetNewsledger.com. Oct. 19
- Robert Storey. 2007. Deeming – It’s Just Wrong Toronto: Bancroft Institute. (IWHP bulletin, no. 4)
(For more resources, search the IWC Library catalogue)
The cost-cutting measure move to remove the lock-in was first proposed in the KPMG Value for Money Audit (recommendation #5). It means injured workers with permanent disabilities who are still unable to work after 6 years will be under “perpetual probation” and will live with the threat of “deeming” hanging over them their entire lives.
Following recent presentations to the Minister of Labour by ONIWG on consequences for injured workers, the Minister agreed the issue needs more consultation and has deferred any action until further review in the Fall of 2015.
Brief history of the “lock-in” of deemed benefits till age 65
1980 – Weiler’s report proposes replacing pensions with a wage loss system with limited deeming, and no lock in of benefits
1981 – Commissioned report by Professor Terence Ison critiques wage loss system, predicting it would involve extensive deeming. He argues against the continuous reviews of earnings and medical status which would put injured workers with permanent disability on “perpetual probation” – making them have to continually prove their injury, a never-ending source of stress and a violation of civil liberties
1986 – In response, Weiler stands firm on deemed wage loss proposal but proposes “as a compromise” the equivalent of a 3-year “lock-in”, after which time benefits are to be no longer subject to review
1989 – Liberal Government passes Bill 162 brings in the wage loss system with lock-in of benefits at the 6-year mark (12 months for first review, then at 2 years and at 6 years) – a measure carefully planned over a period of 10 years, according to their press release
2007 – Bill 187 introduces legislation intended to eliminate deeming however its practice by the WSIB not only continues, but grows
2010 – New WSIB President I. David Marshall focuses attention of the Standing Committee on Public Accounts on the cost of locked-in claims
2011 – KPMG value for money audit for the WSIB reports “these claims represent the most costly claims in the system and exert the biggest impact on the WSIB’s funding status”. It recommends the Board prepare an options paper for the government on the benefits and costs of eliminating the lock-in – if written, it has not been released
2012 – Marshall raises the cost of lock-in claims before the Standing Committee on Government Agencies
2014 – Premier’s mandate letter asks the Minister of Labour to address removing the 72-month lock-in provision
2015 – Government to review the issue further in the Fall
A clothing allowance is a yearly sum injured workers receive if they wear a brace or other device needed for their injury that causes clothing damage. In 1996 the new WSIB changed its policy, reducing clothing allowances by 50%. While the Board claimed this cost-cutting exercise was based on “scientific research” and “clinical evidence” that newer braces caused less wear or tear on clothing, when challenged they could provide no credible proof at all.
After prolonged lobbying, in 2006 then President Jill Hutcheon restored the clothing allowance to all workers affected. However the Board decided workers would not get their money back for the 10-year period when the allowance was cut. Again, for injured workers, it was a simple issue of justice: If the WSIB admitted it was wrong and reversed its policy, why not give the money back?
The right to retroactive benefits – a struggle partially won
Five injured workers, represented by Injured Workers Consultants Community Legal Clinic, have fought this policy change from the beginning. All of the injured workers involved had a life-long back disability and wore a back support (corset) that damaged their clothing. After six years of meandering through the appeal system, a 2012 interim decision by the Appeals Tribunal found the WSIB’s 1996 clothing allowance policy had been developed contrary to the Act and had not met the standard of “good faith”.
Despite the 2012 Tribunal decision, much welcomed by the workers, the appeal was not yet over. Under Bill 99 changes to the Act, when a policy is found “inconsistent” or not authorized by the Act, the Tribunal must send it back to the WSIB for further consideration and wait for their response. The WSIB Board of Directors rejected the Tribunal opinion and directed it to deny the appeal.
However in January 2014 the Tribunal delivered its final ruling [WSIAT Decision no. 1057/09; 2014 ONWSIAT 205 (CanLII]. While acknowledging that the WSIB sets policy, the Tribunal still agreed that the merits and justice of the case warrants allowing the appeal – the five workers are entitled to their full allowance for the years 1996-2006.
Seeking justice for all
The appeal only dealt with 5 injured workers. Many organizations such as the Ontario Federation Labour and legal clinics have written to ask the WSIB to pay all the affected injured workers their arrears of clothing allowance payments. Approximately 5,000 other injured workers, older and permanently disabled, were unjustly denied full compensation. In June 2016 the WSIB announced workers who wore a WSIB-approved back support or back corset and did not receive the full Clothing Allowance amount payable during the period from November 1, 1996 to January 3, 2006 could submit their request for a reconsideration. In October it further announced letter and form would be sent to each worker affected to encourage their application.
It is not clear if the Board will modify its attitude to its own powers displayed in the appeal. In opposing the WSIAT interim decision, the WSIB board of directors acted as though it had limitless powers to develop policy, if it has discretion to do so under the Act. The WSIAT upheld its “audit function” as a guarantor that WSIB decisions follow the principle and the letter of the law.