For the first time in seven years the Yukon Workers’ Compensation Health and Safety Board will increase the average assessment rate paid by employers.
That money goes into a compensation fund to support injured workers.
But because of good investment returns, there is more money than required in the fund.
While it sounds like a good thing, the excess money has been used to subsidize the rate employers should pay.
That means employers have become used to paying less than what it actually costs to care for injured workers.
The calculated cost of caring for workers is at $2.30 per $100 earned.
This year employers will pay on average $1.87 per $100 earned. That’s a two cent increase over last year.
Last year the board gave back over $10 million to employers to reduce its surplus money and help shorten the gap between the current rate and the real cost.
It wants to close that gap within the next four years.
As it stands, the fund is worth $218 million - $36 million more than required by law.
In 2015, over $13 million in interest was generated by the board’s investments, down from $18 million in 2014.
On Thursday the board chair, Mark Pike, said the board would look this fall at whether a further rebate - sending cheques to employers to reduce that extra money - would be needed.
Assessment rates are industry-specific and the average rate only indicates if the rates generally will increase, the board said.
Those specific rates will only be released in the fall.
The rates are calculated based on how much it costs to care for injured workers, with more claims increasing the rates.
By law the board is required to have enough money at any time to cover all the medical expenses for Yukoners who have already had their claims accepted until their death.
On top of that, there’s an additional reserve to offset a market crash or a workplace disaster.
But with only a two-cent increase this year, and the board’s goal to close the gap by 2020, that means the next years could see sharp increases.
“I think it’s fair to say if you go from 1.87 to 2.30 over four years, you’re going to have significant increases,” Pike said when asked about it.
The year 2015 saw no work-related deaths.
That came after 2014 set a sombre record with five deaths.
“Zero is possible but unfortunately it’s still the exception, not the rule,” Pike said.
Since the beginning of the year there have already been two deaths: one resulting from asbestos exposure decades ago and one last week near Gladstone Creek when a rolling SUV fell on top of a man.
There were 434 Yukoners injured badly enough to stay at home in 2015,
about the same as 2014.
Thirty-seven of them were permanently impaired.
The cost of caring for injured workers continues to rise, Pike noted.
If the board were to shut down today, it would cost about $141 million to take care of all Yukoners who have already filed medical claims.
In 2011 it was only $119 million.
Yukon Chamber of Commerce President Peter Turner congratulated the board for what he called a balancing act between increasing the rates to reflect true costs and making sure employers absorb it gradually.
“You don’t want to give everything away at one time,” he told the News.
If the market were to suddenly crash or if a large-scale disaster happened injuring a lot of workers, the current excess would be able to absorb it, he said.
Contact Pierre Chauvin at
pierre.chauvin@yukon-news.com