July 14, 2008

Point-Counterpoint

Experience rating system fails to account for ‘rating prevention practises’

Peter Kenter

correspondent

Gary Robertson is President of Wellington at Work, a Hamilton company specializing in injury prevention, claims and disability management in the construction sector. He is past president of the Council of Ontario Construction Associations and has almost 20 years of human resources experience working for construction contractors.

While he isn’t an opponent of the WSIB’s experience-rating system, he says he supports changes that would provide meaningful incentives to make workplaces safer.

“If we purchase home insurance we have a good idea of the risks and activities associated with the cost of premiums,” says Robertson.

“You’ve installed smoke detectors and the cost decreases. With the WSIB experience rating system the construction contractor doesn’t have those markers or incentives — there is no risk assessment of the firm, and the premium is based entirely on what happened with similar firms in previous years.

“I think the costs of insurance should have some component to reflect what employers are actually doing to affect safety, rather than simply counting the number of claims filed. Experience rating is not a well-tuned tool for rating prevention practices.”

While the CAD-7 experience rating program created for the construction sector attempts to deal with specific industry concerns, Robertson says that the emphasis on injury frequency and the board’s view that a claim is the result of a contravention by the employer is counter-productive.

“The Ministry of Labour already enforces regulations,” he says. “Yet the WSIB, which is supposed to be a no-fault insurance system, is involved in finding fault, making judgements and penalizing employers when worker claims are filed against them. The board is creating conflict in a system which was supposed to remove it.”

Because of high turnover in the workforce, Robertson says that construction contractors are often simply the last employer of record when claims are filed.

“If a carpenter has been banging a hammer with multiple employers for 20 years without an injury, then suffers a disablement resulting from that hammering, how is that injury tied to that one contractor,” he asks.

“If this worker happened to be on the contractor’s books at the time, then it’s supposed to be their claim? There was no ‘accident.’ Is the contractor supposed to prevent carpenters from hammering?”

Robertson says he would prefer to see experience rating rebates or surcharges applied prospectively to the following year’s insurance premium rate, rather than almost one year later as a lump sum payment.

“A cheque results in some extra cash,” he says. “But a predictable lower rate in insurance premiums could be used by contractors to offer more competitive quotes.”

If the WSIB continues to offer incentives, Robertson argues that those rebates should flow through another vehicle outside of the experience rating system, perhaps tied to actual programs proven to improve on-the-job safety.

“I think we’re sort of half-way there,” says Robertson. “Experience rating causes contractors to perform better because there’s a driving principle to force insurance costs down and risk management becomes the focus of the attention, but we need a meaningful reward applied to companies for hitting the right marks in safety program performance instead of penalizing them for no-fault injury claims unrelated to their efforts.

“We need a better balance — one that isn’t so focused on penalizing and finding fault and more focused on innovative tools to improve workplace safety.”

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