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© Copyright 1999 Maclean Hunter Publishing Ltd. The following article first appeared in the March 1999
edition of BENEFITS CANADA magazine.
Keep In Touch
New workers' compensation legislation in Ontario puts the onus on employers to ensure injured
employees get back to work. This close working relationship means new challenges.
BY WILLIAM LEMAY
Since Mike Harris's Conservative government came to power in Ontario four years ago, it has been busy
implementing what is known as the Common Sense Revolution. Many of the changes--particularly in the areas
of healthcare, education and labour--have been revolutionary indeed, not the least of which are revisions
to the province's workers' compensation system.
The first major shift was initiated two years ago with a new Workplace Safety and Insurance Act (WSIA).
Those provisions officially came into effect last July in the form of Bill 99. On many levels, the WSIA
reflects a totally different philosophy of workers' compensation. Simply put, the government has completely
revised the ground rules for employers, employees and the Workplace Safety and Insurance Board (WSIB,
formerly known as the Workers' Compensation Board).
A TROUBLED PAST
In previous years, Ontario had many problems with its workers' compensation system, which was not only
costly to employers but was also unresponsive to the needs of both employers and employees. Under the old
Workers' Compensation Act, the employer and the injured worker did not have to cooperate to plan an early
and safe return-to-work, nor were they encouraged to address other issues relating to a worker's injury.
Instead, they could deflect most of the responsibilities--including a return-to-work plan and managing the
claim--to the Workers' Compensation Board.
The result was a system fraught with lengthy delays in obtaining information, processing claims and hearing
appeals. In one case where an employee had an ongoing dispute with the board over the amount of
compensation he was collecting, the argument went on for more than 15 years after the accident. The effort
and money expended by the employer, the board and the employee to have this claim adjudicated was enormous,
and there was little return for either party.
The new WSIA has changed all of this with its focus on occupational health and safety, the prevention of
accidents and the early and safe return-to-work of employees. Like most legislation, the WSIA is by no
means easy to understand, but for employers, there are two key changes: an injured worker is obligated to
cooperate with the board and his employer; and there is a new procedure for collecting information about
the employee's physical condition and functional abilities.
The WSIA represents a major philosophical shift to a model of self-reliance. Rather than rely solely on the
WSIB, the parties are now required to work together to get the employee back on the job. Under the new
legislation, workers must report an accident as soon as possible after it takes place, and no later than
six months after the accident (in previous legislation, the six-month reporting requirement wasn't nearly
as stringent). As part of this reporting obligation, workers must also agree to provide functional
abilities information--for example, how much weight they can lift with each arm--from a healthcare
professional to both their employers and the board.
This functional abilities data--an entirely new feature of the WSIA--will allow employers to obtain
information about an employee's physical condition, capabilities and prognosis, which can help the employee
get back into the workforce as soon as possible.
That said, however, employers need to assess each case individually to determine whether a functional
abilities evaluation is appropriate. There are at least two circumstances when using this tool may not be
worthwhile:
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When the employee is only absent for a few days.
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If the employee's family physician has a track record of being unable to provide useful information.
Employers should also be aware that functional abilities exams can become troublesome when a physician
doesn't complete the form properly, or the employer is aware that the form doesn't accurately reflect the
worker's abilities. With the former, employers should send the paperwork back to the physician, and with
the latter, employers should apply to the board to have the employee examined by an independent physician.
For employers, the WSIA now requires that they take a more proactive approach when dealing with injured
employees. But, simply ensuring that someone in the organization is responsible for collecting functional
abilities information is not enough: the WSIA requires that they assess this information and determine if
the worker can return to a suitable position within the organization.
The end result is that employers (even small ones) will need to implement a return-to-work process. For
small companies, it can be as simple as having a manager review the employee's file and discuss it with
them. For larger companies, a more formal process is advisable, as it will ensure that employees don't fall
through the cracks and that claims are managed properly.
DIRECT CONTACT
What all this means is a greater level of direct contact between employers and injured workers. They must
be in touch as soon as possible after an accident, and stay in contact while the worker recovers. Together,
employers and employees must also identify suitable and available employment that is consistent with the
worker's functional abilities. This requires close control over all employees who are absent on workers'
compensation--employers need to know the status of these employees at all times.
A sample procedure would go something like this:
Once a worker has an accident that causes him or her to be absent from work, the worker and the employer
complete a report about the accident.
The employer follows up with the worker to get his functional abilities information, and passes it on to
the appropriate staff within the organization. How employers obtain this information from the doctor is
often a difficult problem, especially if the employee doesn't cooperate. As previously stated, however,
some sort of formal return-to-work system is essential for all employers.
THREAT OF PENALTIES
Under the new legislation, there are clearly defined penalties for failure to cooperate, both on the part
of employees and employers. In the case of employees, the WSIA clearly states that benefit payments are
dependent on their cooperation with the board and their employer. If a worker doesn't cooperate, his
benefits can be suspended or terminated. The same rules apply to employers--if a company fails to cooperate
with the WSIB or the employee, it will be subject to a financial penalty. How these penalties will be
enforced, however, remains to be seen.
As an employer or manager, the prospect of being fined is daunting. It is important to remember, though,
that the board has provided the tools to manage this process and make sure it doesn't get to that point. As
mentioned, employees are required to provide their employers with relevant information as requested, which
will ease the task of returning employees to work (as long as employers fully understand the information
and use it effectively).
Employers are not just provided with the functional abilities information when a worker goes off on
benefits--they also have the right to obtain additional information as that employee's claim progresses.
Under the WSIA, an employer has the right to request an independent medical assessment of the employee with
a physician of the employer's choice, paid for by the employer. If the worker objects to this examination,
he or she must inform the board, and the employer has two weeks to appeal to the board. The board then
decides whether the medical exam will take place.
While this general right to have an employee submit to a medical examination existed under the previous
Act, the new legislation states that employees who refuse to submit to a medical exam (when ordered to do
so by the board) can have their benefits terminated until they agree to the examination. This is a right
that is not widely known among employers, but is useful when an employer questions the extent or even
existence of a medical problem. If this is the case, employers can take a more proactive approach, but must
ensure that they have a sensible reason for making this request. Otherwise, the board may rule against
them.
THE RIGHT TO OBJECT
An employer also has the right to object to any board decision regarding an employee's entitlement to
benefits, within six months of the decision (beyond six months, the board may not allow the objection to
proceed). When an employer files an objection, the board will send it all of the non-medical records in the
employee's file, and will also provide the medical documents which relate specifically to the injury in
question (unless the worker objects and the board believes the objection is valid). Reviewing this
information can help employers determine:
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whether they actually want to proceed with the appeal; and
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whether there are other issues in the file that need to be addressed.
One of the more interesting features of the WSIA is what is known as the New Experimental Experience Rating
(NEER). This system is an incentive (or reward) for employers that manage claims and workplaces properly.
It applies only to Schedule 1 employers (those that belong to a WSIB rate group based on their industry and
pay premiums, rather than direct claims costs), but excludes those which are part of the construction
industry or are small businesses.
Under NEER, a company's actual claims costs are measured against the board's expectations of its costs. If
the firm is doing better than the board expects, it will receive a rebate on its premiums. However, if an
employer has more claims costs than the board expects, it has to pay a surcharge in addition to its regular
premiums.
The rebates and penalties are significant. In one case, for example, a mid-sized employer with about 400
employees is appealing a decision involving a single claim. If unsuccessful, the employer will have its
NEER costs increased by approximately $80,000. This is no small sum--even for a mid-sized company--and
points to yet another incentive for employers to manage their claims effectively and ensure that employees
are coming back to work as quickly as possible.
Although each province has its own legislation, the problems are often the same--across the country,
workers' compensation is a source of frustration for many employers. Regardless of its official
obligations, any employer will benefit from a return-to-work program such as the one described under
Ontario's WSIA. Bill 99 offers Ontario employers a more effective and fair tool for dealing with claims,
which in turn will help to reduce costs. These changes are not, however, the "magic elixir" to cure all
workers' compensation challenges. Ultimately, workers' compensation woes can only be cured through
proactive management.
William LeMay is a lawyer specializing in management-side labour and employment issues at Hicks Morley
Hamilton Stewart Storie in Toronto.
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