OTA slams WSIB rate hikes
TORONTO, Ont. — The Workplace Safety and Insurance Board (WSIB), whose workers’ compensation system currently has a $14 billion unfunded liability, has announced that the 2011 premiums paid by Ontario employers will rise by an average of 2%.
For the trucking industry, the General Trucking (rate group 570) rate will increase by 11.1% going from $5.79/$100 of insurable earnings to $6.43. Warehousing (rate group 560) and Courier Services (rate group 577) will also see increases, with Warehousing increasing by 18.4% from $2.77 to $3.28 and Courier Services by 17.5% from $2.46 to $2.89/$100 of insurable earnings.
OTA president David Bradley reacted to Friday’s announcement saying, “This is the worst possible time for the government to be increasing payroll taxes. The economic recovery is still fragile and anything that discourages hiring is only going to prolong the pain.”
Bradley pointed to the fact that Ontario Premier Dalton McGuinty recently invoked the “now is not the time to raise payroll taxes” mantra when he chided the federal government for increasing EI premiums. “The WSIB should take the Premier’s advice and do everything in its power to keep rates stable rather than hiking them when businesses are still so economically vulnerable,” Bradley said.
As part of the announcement, the WSIB also indicated that it would be undertaking a comprehensive review of funding for the WSIB system headed by Harry Arthurs, former Dean of Osgoode Hall Law School and President Emeritus of York University. According to Bradley, “any decisions about the need for rate hikes should wait until after the completion of this review.”
“Regardless,” he says, “funding is only part of the problem at the WSIB; it has got to get costs under control, eliminate fraudulent claims, and making sure that all employers who should be in the system are.”
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Mr. Bradley should get his facts straight.
Employers have enjoyed rate reductions for over 10 years, this is a major contributor to the unfunded liability (UFL). Worker fraud is negligible, employer fraud is far more prevalent. “For the 10-year period from 1995 to 2004, the average premium rate paid by Ontario’s employers declined 27 per cent from $3.00 to $2.19, and contributed significantly to the rise in the unfunded liability in recent years.”
The question I pose to Mr. Bradley is, when all other costs have risen in the past 10 years (health care, prescription drugs, etc.)how does he explain that employer rates should remain stagnant or be reduced?
Should injured workers bear the brunt of inflation alone, I think not.
Perhaps Mr. Bradley would prefer a system where injured workers sue their employers
The WSIB administration costs are under 11% of the total system expenditures, one of the lowest in the Country.
It is time for a frank discussion on the system and I applaud the WSIB and the Government for having the guts to tackle it. I would also add that the members of the funding review committee are fairly balanced (labour, academia, industry and government), in fact the only group not represented are injured workers.
To Mr. Bradley and the other employers who cry wolf about this review I say “suck it up buttercup”, fairness in this system is in everyone’s best interest.