Facts about the WCB’s Funded Position
Recently, the Canadian Federation of Independent Business (CFIB) issued a press release referencing their own research document where they suggest that WCB’s across the country “are holding onto $6.8 billion in extra money.”
Their research document goes on to suggest that all workers’ compensation board’s funding ranges in Canada should fall within 100 per cent to 110 per cent. This, however, runs contrary to the independent external actuarial advice that boards across the country have received to set funding ranges. While a review of CFIB’s research would be beneficial, they have been unable to share the data that led to their suggested funding range.
In Saskatchewan, the WCB is legislated under The Workers’ Compensation Act, 2013 to maintain an Injury Fund sufficient to finance injured worker claims including wage loss, physical and vocational rehabilitation, prevention initiatives and other obligations under the Act. To ensure its funded position, the WCB established a funding range based on advice from its external actuaries that targets a funded position between 105 per cent to 120 per cent. This range ensures sufficient funds are available to meet required benefit levels and protects against unexpected claim activity or potential fluctuating economic conditions.
Based on independent actuarial advice, the Saskatchewan WCB’s funded position ensures sufficient funds are available to meet the needs of workers injured on the job.
In the past 30 years, the Saskatchewan WCB has exceeded its funding range five times – in 1998 ($23 million), in 1999 ($38 million), in 2000 ($36 million) and in 2014 ($141 million) and 2015 ($281.5 million). These were largely the result of positive investment earnings and 100 per cent of all surplus exceeding the funded position was distributed back to employers.
The system of compromise that makes up our compensation system in Canada exists to protect both employers and workers in the event of a workplace injury. While maintaining the balance required to fully fund our compensation system, the Saskatchewan WCB has seen an annual drop in its average employer premium rate for the past 11 years, largely due to the reduced number of injuries, making it the lowest rate in over 30 years. Premiums paid by employers today are used to cover the cost of today’s injury claims.