(Oct. 30/13) Prince Edward Island will increase benefits under the Workers’ Compensation Act. Key proposed changes and CRFA’s thoughts on these are as follows:
- Maintain or achieve fully funded status
P.E.I.’s Workers Compensation Board (WCB) was funded at 103 per cent in 2010 and 108 per cent in 2012. The WCB’s policy of maintaining full-funded status would be made law under the proposed changes. CRFA supports this provision.
- Reduce wait period from three days to two
P.E.I.’s wait period is three-fifths of one week’s wages, and is likened to a “deductible” in an insurance policy. The proposed wait period is equal to two-fifths of a worker’s weekly wages. CRFA is disappointed the waiting period will be reduced, but acknowledges its maintenance is critical.
- Increase wage loss benefit from 80 to 85 per cent of net insurable earnings
P.E.I’s wage loss benefit is 80 per cent of net insurable earnings for the first 38 weeks on claim, and 85 per cent thereafter. Under the proposed change, benefits would be set at 85 per cent of earnings throughout the claim period, which is generally in line with other jurisdictions. The injured worker does not pay tax on this benefit.
- Increase benefits indexation from 75 to 80 per cent of CPI
Currently, the Workers’ Compensation Act provides for an adjustment of benefits on July 1 of each year that equals the lesser of either four per cent or three-quarters of the percentage change in the Consumer Price Index (CPI) for Charlottetown and Summerside.
These changes are a result of the large surplus in the accident fund. In previous meetings with the WCB, CRFA had expressed concern with moves to increase benefits or eliminate the waiting period. Instead, we had pushed for rate relief as the key way to reduce the surplus position.