This course is a brief introduction to workers' compensation issues in Newfoundland. At the end of the one day session you will become familiar with why the workers' compensation system was set up originally and why it is structured the way it is today. You will understand how it may be changed in the future.
You will learn how the system works today so that you will be able to establish a claim for workers' compensation for yourself and be able to help your fellow workers with problems they may encounter in establishing a workers' compensation claim.
Small Group Discussion
Case 1
Don Farrell works in a fish plant. One day when driving to work, he gets rear ended. His car is damaged but driveable. Don carries on to work and is able to work his normal shift. The next day he is not able to get out of bed due to back pain.
Questions
1. Is Don entitled to workers' compensation?
2. If so, why? If not, why not?
3. What else do you need to know to figure out if Don is entitled to workers' compensation?
4. Do you think workers should receive workers' compensation for accidents that occur on their way to and from work?
5. Suppose Don had arrived at work safely but then had been rear ended in the plant parking lot. Would he be entitled to workers' compensation?
6. What is the general principle used to decide whether an injury or disease is compensable or not? How Did Workers' Compensation Get Started?
In order to understand how workers' compensation got started, we need to see what workers were entitled to before workers' compensation.
The simple answer is, not much.
During the last century, many workers were killed or badly injured in mines, factories, in the forests, and in fishing. As well, many more workers died from diseases caused by their work. One example of these diseases is silicosis. Silicosis is a lung disease caused by breathing in dust in mines or foundries.
There were few laws to protect workers' health and safety. Workers with disabilities were usually fired when they weren't able to do the job they were hired to do. The usual result of major injuries or fatalities was life-long poverty for workers or their families. In theory, injured workers and the families of workers who were killed had the right to sue their employer to try to get enough money to live on.
In practice, suing employers was very hard. Most workers could not afford the cost of the lawyers that would let them take their employers to court. Even if they were able to go to court, the courts in those days were unfriendly to workers.
In lawsuits over workplace accidents, employers were able to use three legal defences to defeat the claims of workers. These defences were:
1. Contributory Negligence - even if the employer was mostly at fault, any fault of the worker prevented the recovery of any money from the employer.
2. The Fellow Servant Rule - the employer was not responsible if the accident was the fault of a fellow worker.
3. Assumption of Risk - workers should have known the risks of the job when they went to work. And if there were risks, they should have bought their own insurance.
Questions for Discussion
1. Do you think workers would be better off today if they had the right to sue their employer instead of trying to get workers' compensation?
2. Do you think the attitude of the courts has changed to workers and employers?
3. What about the results for the families of the workers who were killed in the Ocean Ranger and Westray disasters? Would they have been better off suing their employer?
Pressure for Change
The injustices of the system, unsafe working conditions, low wages, and long working hours led to the expansion of the Canadian union movement. Our movement fought to improve laws to protect workers.
We fought for health and safety laws to protect workers and for workers' compensation so that workers would have an income and medical assistance if they were hurt at work.
Employers were of two minds. While they resisted the development of strong health and safety laws, they saw the advantage of workers' compensation. Such a system would protect them from the occasional successful lawsuit. Remember in the last century and the early part of this century, young children often worked in factories, mines, and in the forest and fishing industries. Maimed children (or their families if the children were killed at work), had a chance of success in court against their employers if the trial was heard by a jury.
The uncertainty of the possibility of a successful lawsuit persuaded the employers in Ontario that they would be better off paying workers' compensation premiums.
Since Ontario was the industrial heartland of Canada, it is not surprising that workers' compensation began there. The pattern had been set in Germany some 30 years before and had been copied in some American states.
In 1912 the Ontario government commissioned Sir William Meredith to study ways to deal with workplace-related disabilities and deaths. In his Final Report in 1914, Meredith proposed that a workers' compensation system be set up in Ontario. He balanced the demands of the employers and the labour movement. For workers, the new system was a significant improvement over the past.
Meredith proposed a compensation system based upon certain principles, most of which still apply today. The Ontario workers' compensation system was copied in the rest of the Canadian provinces either before they entered Confederation or after it.
Meredith Principles
1. Security of Payment - The worker was to be guaranteed compensation for as long as earnings were impaired.
2. No Fault System - It would not be necessary to prove negligence in order to receive benefits. Contributory negligence would not prevent workers from receiving benefits.
3. Employer Funded Collective Liability - The vast majority of employers would have to contribute to a fund from which benefits would be paid. This protected small firms from the potentially high costs of serious accidents.
4. Administration by an Independent Agency - This was the beginning of the Workers' Compensation Boards or Commissions. Workers were to be spared the expense and delay of going to court.
5. Injured Workers Could Not Sue Their Employers - In exchange for the establishment of workers' compensation, workers gave up their right to sue their employers. This is often referred to as the historic trade-off. This means that workers' compensation is not welfare; workers' compensation is a right.
Newfoundland and Labrador
Prior to 1949, Newfoundland and Labrador had workers' compensation laws in which workers had to prove fault on the part of the employer.
After Confederation with Canada, Newfoundland's compensation laws were brought in line with those elsewhere in the country. In 1950, the first Workers' Compensation Act was signed into law by the Lieutenant Governor, and made effective April 1, 1951.
The 1980's and 1990's
Within the last fourteen years, employer pressure to erode Canada's social programs has increased. While the employers as corporations and as individuals have been successful in paying a smaller and smaller share of taxes, taxes on working people have increased. In order to avoid paying even more taxes, business interests lobby governments to cut back social programs which we as Canadians believed we had a right to expect.
Some of these social programs existed in Canada before Newfoundland joined Confederation such as unemployment insurance. Others, such as medicare and Canada Pension came after. Today, all are at risk. In the name of the need to cut the deficit, our social safety net is in jeopardy.
Workers' compensation is no exception. It too is under attack from employers in every province.
In order to understand the basis of the current employer attack on workers' compensation, we need to understand two concepts, experience rating and the unfunded liability.
Experience Rating
Remember the Meredith principle of Collective Liability? Employers would pay into a common fund which would in turn pay benefits to disabled workers. It therefore did not matter precisely what employers paid - workers were still entitled to benefits.
The successful employer lobby of the 1980's and 1990's changed all that. Experience rating began to be introduced in nearly all workers' compensation systems in Canada. In Newfoundland, experience rating began to be introduced in 1989 and by 1995 will be expanded to all industry in which employers paid more than $3,000 in assessments for the preceding three years.
Experience rating is a system in which the assessments of the individual employer vary according to the claims costs of the workers of the individual employer. In other words, the higher the past costs, the higher the assessments; the lower the past costs, the lower the assessments.
Small Group Discussion
In your small group, read the article on experience rating from the Canadian Centre for Occupational Health and Safety's publication, At the Centre. It will help you to answer the following questions.
1. If employers have to pay more money in assessments as a result of their workers getting hurt, do you think they will expend more effort in having a safer workplace?
2. What is a faster and more certain way to get claims costs down?
3. When was experience rating introduced in Newfoundland? When will experience rating be extended to all Newfoundland employers?
4. Do you think workers and our union will have an easier or a tougher time establishing workers' compensation claims when experience rating is expanded?
Unfunded Liability
The Workers' Compensation Commission pays short term and long term disability benefits. As well, for people with permanent disabilities, they pay a permanent functional impairment award.
The Workers' Compensation Act requires the Commission to set aside enough money today to meet all future costs of a claim. In other words the Commission must fund the future costs. This is a common requirement of private pension plans.
If the Commission sets aside enough money to meet all future costs, the fund is said to be fully funded.
If the Commission fails to set aside enough money to meet all future costs, the fund is said to have an unfunded liability.
You can see that the unfunded liability is different from a deficit. The Commission doesn't owe anybody any money. It simply owes money to itself in the future so that it can pay out benefits.
Question for Discussion
1. What is the amount of the Newfoundland WCC unfunded liability?
Growth in the Unfunded Liability
This shortfall in the amount of money needed to fund its future liabilities began for most Canadian Workers' Compensation Boards or Commissions in the 1980's. The Workers' Compensation Boards and Commissions failed to assess employers premiums high enough to meet the future costs. The unfunded liabilities began to grow.
Rather than increasing assessment rates when they should have, the Boards or Commissions gave in to employer pressure to freeze or in some cases even lower employer assessment rates. In nearly all cases rates were not increased quickly enough to meet the future costs.
Today, employers point to these unfunded liabilities in the same way as they point to the federal or provincial deficits. They say that these financial "problems" must be solved by eroding social programs. Federally, they have been successful in threatening unemployment insurance, family allowance, Canada Pension, Old Age Pension, and medicare, some of which are direct erosions and some of which are eroded by reductions in transfer payments to the provinces.
Provincially, they attack welfare and the workers' compensation system.
In Newfoundland, New Brunswick, and Manitoba, the employer lobby has successfully eroded the benefits which we used to be entitled to under workers' compensation.
The answer to the federal deficit is to increase taxes on corporations and rich people, who have paid a lesser and lesser share since the early 1980's. As the taxes on working people have gone up, corporations and rich people have paid less.
The answer to the Newfoundland Workers' Compensation Commission's unfunded liability is to increase employer assessment rates. During the last decade and a half, Canadian employers have paid assessment rates lower than the amounts they should have. It is time this payroll tax break ended.
Instead, in Newfoundland, New Brunswick and Manitoba, focusing on the unfunded liability, the employers have successfully argued for reductions in benefits paid to disabled workers rather than increased taxation on the employers.
Dramatic changes were made to the workers' compensation system in Newfoundland effective January 1, 1993. The Workers' Compensation Commission stated that the reason for the changes was to "address the growing unfunded liability of the Commission and to ensure its future viability". Benefit levels have been drastically cut back in Newfoundland.
The nature of the system has been changed to reflect the private insurance group plan system with its short term and long term disability benefits. Can a push for privatization be far behind? In Atlantic Canada, there has been active discussion about bringing the four Workers' Compensation Boards and Commissions into one system. Nova Scotia is presently actively pursuing a program which we predict will result in the same level of benefit reduction as has taken place in Newfoundland and New Brunswick. Prince Edward Island can't be far behind.
In the future, Newfoundland workers and unions may find that they have to telephone a life insurance company in Halifax instead of the Workers' Compensation Commission in St. John's, Corner Brook or Grand Falls - Windsor in order to get information about their workers' compensation claim.
The Fight in New Brunswick
The New Brunswick Federation of Labour organized a vigorous fightback campaign against the cuts to the workers' compensation system.
This videotape is very well done. It explains the fight in New Brunswick.
Question for Discussion
1. What did you think of the video?
Canadian Workers' Compensation is Inexpensive
In comparison to other workers' compensation systems such as in the United States, Canadian employers are able to buy cheap workers' compensation insurance. The reason for this is because the Canadian workers' compensation system is publicly administered. In the U.S., most workers' compensation coverage is private. Lawyers benefit from the U.S. adversarial court based system where workers must go if they want to appeal a claim disallowal.
Even though employers pay more money for assessments in the U.S., American workers receive a much lower benefit level than Canadian workers. Private insurance companies and lawyers rake off the difference.
Question for Discussion
1. Do you think that the North American Free Trade Agreement (NAFTA) threatens the Canadian workers' compensation system?
Should We Go Forward or Backward?
As the union movement fights against cutbacks to social programs, we have to ensure that we do not simply hunker down in our bunkers and see ourselves get blown to bits.
Our agenda has always been to fight for progress, for improvements to the lives of working people.
Is it possible to fight for improvements to workers' compensation? Can we hope to make things better for workers with disabilities? Our union believes we can.
Our program for progressive change is to abolish workers' compensation and replace it with something better, a universal disability plan that would provide income and other benefits to people with disabilities, regardless of the cause of their disability.
Small Group Discussion
Try to answer the questions first by discussion in your group. Then read the article on Universal Disability together to help you to fill in the answers.
1. Name the types of disability income plans presently found in Newfoundland.
2. If we were to get rid of all of the private and public plans and replace them with one plan
a) what would the savings be to employers?
b) what would the benefits be to workers?
3. Would we want a publicly administered plan or private insurance plans?
4. Could employers get "off the hook" in paying for work-related disabilities if we changed to a universal disability plan?
How Does an Injured Worker Apply for Benefits?
Small Group Discussion
Work together on this. Some of the forms are in your manual. Look for the Form 6 to fill out. Help each other out filling in the Form 6.
1. Who do you have to tell if you are hurt at work and when?
2. What form do workers have to fill in to make a WCC claim? Where do they get these forms? Can someone have help to fill in the form?
3. What kind of form does the employer fill out? If they disagree that the injury is work-related can they refuse to fill in the form? 4. What kind of form does the doctor fill in? Does the doctor have to send in the form right away?
5. Using the following information, fill in the Form 6. Fill in all the personal information about yourself, your workplace, and your doctor. Your injury happened at work on February 21, 1994 at 2 p.m. A co-worker, Mary O'Connell saw the accident. You cut your left hand badly opening a box with a knife and you had to go to the doctor. He told you you would be off work for a couple of weeks. You are filling in the form on February 25, 1994. You've never had a workers' compensation claim before.
Basic Information
Questions for Discussion
1. Can injured workers can go to the doctor of their choice?
2. If the Commission tells injured workers to go to one of their doctors, do they have to go?
3. Do injured workers have to deal with a lot of different people at the Commission?
4. Can injured workers go to chiropractors and will the Commission pay?
Workers' Compensation Benefits in Newfoundland
Questions for Discussion
1. What are the main types of benefits workers are entitled to under the Newfoundland Workers' Compensation Act?
2. Before January 1, 1993, what was the income replacement rate (benefit rate) paid by the Commission?
3. If your gross income was $400.00 per week before January 1, 1993 and your deductions (UIC, CPP, Income Tax), were $94.46, how much money would you receive as the WCC benefit?
4. After January 1, 1993, what is the income replacement rate (benefit rate) paid by the Commission for the first 39 weeks of disability?
5. If your gross income was $400.00 per week after January 1, 1993 and your deductions (UIC, CPP, Income Tax), were $94.46, how much money would you receive as the WCC benefit for the first 39 weeks of disability?
6. After January 1, 1993, what is the income replacement rate (benefit rate) paid by the Commission after 39 weeks? Till what age are these benefits payable?
7. If your gross income was $400.00 per week after January 1, 1993 and your deductions (UIC, CPP, Income Tax), were $94.46, how much money would you receive as the WCC benefit for the first 39 weeks of disability?
8. If your gross income was $400.00 per week in 1992 and you were off work during the whole of 1992 (52 weeks), how much would the total amount of WCC benefits be?
9. If your gross income was $400.00 per week in 1993 and you were off work during the whole of 1993 (52 weeks), how much would the total amount of WCC benefits be?
10. What is the difference between the two amounts you would have received in 1992 compared with 1993?
11. Are workers with disabilities better off or worse off today than they were before the changes to the Act effective January 1, 1993? Do you think it would have been better if employers were charged increased assessment rates rather than workers with disabilities having their benefit rate cut?
12. Can the Commission deduct benefits received from Canada Pension from workers' compensation benefits?
13. Let's say you get a finger cut off by a line on a fishing vessel. You are off work for a few weeks and then return to work. Are you entitled to anything more from the Commission? What is this called? What's it for?
14. What is the maximum annual compensable earnings level? What does this mean per week?
15. What is the minimum weekly compensation?
Vocational Rehabilitation Programs
Questions for Discussion
l. Are disabled workers automatically entitled to vocational rehabilitation in the same way as they are entitled to income replacement benefits?
2. What are some of the types of vocational rehabilitation programs?
3. What is the order of preference for the WCC to offer rehab assistance?
4. Does an injured worker receive benefits while participating in a vocational rehabilitation program?
5. What training benefits are provided?
6. What are the titles of the WCC people who deal with vocational rehabilitation?
7. Does the employer have to modify an injured worker's job so he or she can return to work?
8. What are some of the examples of the kinds of payments that the Commission may consider in the area of vocational rehabilitation?
Survivor Benefits
If an injury or disease causes death, the spouse and dependent children are entitled to benefits. The benefits vary, depending on the deceased worker's income and the age of the spouse and the dependent children.
All dependent spouses are entitled to a lump sum payment calculated at two and a half times the deceased worker's annual compensable rate.
The age limit for dependent children is 18 years of age. If there is no dependent spouse, the dependent children will receive a portion of the lump sum benefit which would have otherwise been paid to the spouse.
The Commission will pay an amount for the transportation of the body and for burial expenses.
The Commission may provide vocational rehabilitation services to the surviving spouse.
If You Disagree With a Decision
Question for Discussion
1. If you disagree with a decision made by somebody at the Commission, what do you do?
Internal Review
Your written request must say in detail what you disagree with and why.
Here's where to write:
Secretary, Review Division
Workers' Compensation Commission
146-148 Forest Road
P.O. Box 9000, Stn. B
St. John's, N.F.
A1A 3B8
Reference: Internal Review
Question for Discussion
1. Who looks at my letter?
The Secretary of the Review Division or the Review Specialist should let you know that your letter has been received. If you don't hear from them, contact them again.
The Review Specialist will look at your file and your letter. He or she may discuss your objection with the person who made the decision.
The Review Specialist may agree with the original decision, agree with you, or amend the original decision in some other way. They will let you know what they decide in writing.
2. Can I have a hearing?
3. Can I see my file?
All requests for copies from files must be made in writing. You must indicate exactly which copies you want to receive.
The basic fee is $5.00 for requesting information and $.25 for each photocopied page.
Write to the Secretary of the Review Division at the above address and put Reference: Access to File on the envelope and your letter.
4. Can my employer see my file?
During 1992, Review Specialists looked at 488 claims. Eighty one percent of the initial decisions were upheld.
Workers' Compensation Appeals Tribunal
Since the likelihood of success of winning a better decision at the Review Specialist is so slim (19%), you should expect to take your case further to the Workers' Compensation Appeals Tribunal (WCAT) where you have a better chance of winning. The WCAT is external to and independent from the Workers' Compensation Commission.
In 1992 the WCAT made 111 decisions; they disallowed 29 % of the appeals; allowed, allowed in part, or referred back to the Commission for further action, 71 % of the appeals.
The WCAT always holds a hearing so that you can go and put forward why you think you should get benefits. You can go by yourself or bring a family member, friend, lawyer, or union representative to represent you.
The WCAT holds hearings in St. John's and also travels to Gander and Corner Brook to hold hearings.
If you have gone to the Internal Review and are dissatisfied with their decision, write to:
Workers' Compensation Appeals Tribunal (709) 729-5542
Ashley Building, 31 Peet Street
St. John's NF A1B 3W8
Talk to someone in the union about your case to see if you need further information such as an opinion from your doctor or specialist which supports your case.
In the Fishing Industry
Workers' compensation is available to inshore fishermen throughout Newfoundland and Labrador.
You don't have to pay for workers' compensation; your employer does. Your employer may be the owner of the boat you work on; or, if you're an independent fisher, the fish buyer must pay the cost of workers' compensation.
If you are an independent fisher and you sell your catch to a fish buyer, the buyer is required to pay into workers' compensation. He pays $1.50 for every $100 worth of fish he buys from you. He must also keep accurate records so you can be paid the right amount of workers' compensation if you have to make a claim for an injury.
If you sold $1000 worth of caplin to a freezer plant, $2000 worth of salmon to one buyer, and $10,000 worth of salmon to a processing plant, all the buyers would be required to pay into workers' compensation. They would pay fees on the total of $13,000 worth of fish they bought from you.
If you then had to make a claim for workers' compensation, the Workers' Compensation Commission would obtain your records of earnings from all your buyers, and you would be paid compensation based on what you earned, less your expenses for catching the fish.
How to Reach the Workers' Compensation Commission
HEAD OFFICE
Workers' Compensation Commission
146-148 Forest Road
P.O. Box 9000
St. John's, NF A1A 3B8
Tel: 709-778-1000
Fax: 709-738-1714
Free: 1-800-563-9000
REGIONAL OFFICES
Workers' Compensation Commission
Main Street
P.O. Box 474
Corner Brook, NF A2H 6E6
Tel: 709-639-9960
Fax: 709-639-1018
Free: 1-800-563-2772
Workers' Compensation Commission
26 High Street
P.O. Box 850
Grand Falls - Windsor NF A2A 2T7
Tel: 709-489-9883
Fax: 709-489-4071
Free: 1-800-563-3448
Small Group Discussion
Case 2
Martha Reid works in a fish plant filleting fish. She's worked there four years. Her wrists started bothering her a couple of months ago but she put up with the discomfort. Last week she just couldn't face going to work on Monday and she called in sick.
1. Did Martha have a compensable injury?
2. Did she report her injury properly?
3. What should she have done?
Case 3
1. Probably. We assume he collapsed at work because he had developed crab workers' asthma.
2. He may need to see a specialist in order to have enough medical evidence to establish a workers' compensation claim.
Case 4
1. Yes.
2. No. Harold has suffered an aggravation of a previous injury. It was his work in Newfoundland that aggravated the injury so the injury is compensable.
Case 5
1. Yes. Margaret has suffered noise induced hearing loss from her noisy plant. This is a compensable condition.
2. Margaret should go to her doctor and ask him to send her to a specialist who conducts hearing tests. She should tell her doctor and the specialist that she works in a very noisy plant. Margaret should ask both doctors to send in medical evidence to the Workers' Compensation Commission about her noise induced hearing loss.
Case 6
1. John should contact the Vocational Rehabilitation Counsellor at the Workers' Compensation Commission. He should explain his problem and ask the Counsellor to persuade the company to take him back on a gradual return to work basis. Once the company finds out that the WCC will pay for such a gradual return to work, they will be more willing to take John back.
Case 7
1. She should write to the Secretary of the Review Division and ask for an Internal Review. She should get a copy of her claim file and read it thoroughly to see if additional medical evidence is needed.
2. She should appeal further to the Workers' Compensation Appeals Tribunal (WCAT).
THE WORKERS' ADVISOR
There is a Workers' Advisor who helps both unionized and non-unionized workers free of charge on any matters related to workers' compensation. The Workers' Advisor provides general information about the workers' compensation system and helps workers interpret the Workers' Compensation Act. This person will also liaise between the injured worker and the Workers' Compensation Commission (WCC) and the injured worker and the Workers' Compensation Appeal Tribunal (WCAT).
To speak to the Workers' Advisor, contact the:
Newfoundland and Labrador Federation of Labour
Phone: 754-1660
FAX 754-1220
