Cost of living adjustments

In 2018 an amendment of the Workplace Safety and Insurance Act will come into effect, finally providing all injured workers full Consumer Price Index indexation of benefits on an annual basis – including those on partial disability benefits. 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 (providing half of the Consumer Price Index minus 1%).

Despite the 2003 election promises of the Liberal leader, and recommendations of Harry Arthurs’ “Funding Fairness” report (p. 102, there have been ad hoc adjustments but no real move to full cost-of-living adjustment until the Budget Measures Act of 2015 (Bill 144, Schedule 23).