1. By the Office of the Employer Adviser
WSIB Update
Introduction of self
Experience
Territory
By the Office of the Employer Adviser

2. Issues
Funding Framework
Chronic Mental Stress

3. Funding Framework Major Changes
New classification system
New single prospective experience rating system
End of most multiple rate groups (RGs)
Approved by WSIB board of directors for Jan 1, implementation

4. New Classification Structure
Simpler classification structure based on North American Industry Classification System (NAICS) codes
NAICS to replace current RG model
9 Schedule 1 Classes
175+ RGs and 800+ classification units
34 NAICS based classes
Class assignment based on predominant business activity

5. Determining Predominant Activity Class
RG 764
48% IE
RG 741
41% IE
RG 728
11% IE
Subclass 1
Subclass 3
Subclass 3
52% Placed in G31

6. The New Classification Process
Default is one Class per employer based on predominant business activity
WSIB will determine employer’s class based on three years of insurable earnings information
New employers registering after new classification structure implemented, will be classified on proposed business activities
will need to demonstrate their predominant class to the WSIB
Rule 1 – Risk Disparity
Risk disparity would be examined by comparing the risk profile of the 34 industry classes/subclasses to the next level of the NAICS. This would assist in determining if further expansion of the number of classes/ subclasses would produce improved outcomes that address and balance any risk disparity and actuarial predictability. An industry class/subclass would demonstrate risk disparity if the risk profile within each industry class/subclass, tested to the next level of NAICS where appropriate, is greater than +/- 20%.
Risk disparity is when claims experience or premium rates vary significantly from the average experience of the class/subclass
Rule 2 – Actuarial Predictability
If an industry class/subclass met the risk disparity threshold, the actuarial predictability would be tested against a revised level of actuarial predictability that would support reliable and stable premium rate setting, established as either $12.0 billion in insurable earnings over 6 years or $6.0 billion in insurable earnings and $15.0 million in claims costs, over 6 years. Taken together, both risk disparity and actuarial predictability will form part of the regular, ongoing monitoring of the new rate framework that would help determine when or if any further changes to the classification structure would be required. This will ensure that the classification structure evolves with any changing risk and experience within a particular industry, rather than holding to a firm number of classes/subclasses.

7. Exception to Rule of No Multiple Rates
WSIB will allow multiple rates for employers engaged in multiple non-dependent activities without the need of incorporating separate companies if meet three conditions
properly segregate payroll for the business activity
business activity must not form an “integrated operation” with the employer’s other business activity or activities
business activity must be significant enough (a sufficient share of payroll

8. Employer’s Actual Premium Rate
Individual employers assigned an adjusted premium rate representing how much an employer would pay
WSIB Considers
risk band limitations
previous year’s premium rate
minimum premium rate for the class, and
collective experience of all employers in the class

9. Cost Components of Employer Projected Rate

11. Experience Rating
Will be a new prospective experience rating model with no rebates or surcharges for most employers
Employers placed in a risk band relative to the Class Projected Premium Rate

12. Risk Banding 40 – 80 bands / class
Risk bands are subject to limitations
premium rate of the minimum risk band ($0.20)
maximum risk band will not exceed 3X the Class Projected Premium Rate
each risk band represents approximately 5% increments in premium rate
Annual Premium Rate Adjustments capped at 3X the Class Projected Premium Rate
limits an employer’s risk band movement each year, and protect an employer from unexpected catastrophic claim costs in a specific year

13. Lengthened ER Window Proposal recommends a 6 year window
WSIB proposing a weighted experience window that values the most recent three years 66.6% and the next three years at 33.3%

14. Surcharge
WSIB proposes surcharging employers who are consistently at the maximum of their class
WSIB is recommending the Rate Framework include a surcharge mechanism
WSIB will undertake a further review in the development of a specific approach that would work alongside workplaces to identify key drivers for a sustained poor claims experience

15. SIEF
Based on stakeholder response, WSIB will keep SIEF as a interim measure pending the review
Will also look at appropriate cost allocation of relief, considering the potential for some allocation at the Schedule 1 level, compared to current practice of allocating at the Industry Class level

16. Fatal Claims
Current fatal claims policy – loss of a rebate in year of accidental death – will not work in new system
WSIB recommending to use the rolling five year average cost of fatalities across Schedule 1, in place of the actual cost of a fatal claim
2014 average cost of a fatality was about $367,000
the per claim limit will apply to fatality claims

17. Long Latency Occupational Disease
Rate Framework proposes to keep LLOD claims as a collective cost that is pooled at the class level – ie, not experience rated
WSIB asks whether LLOD costs should continue to be borne by all employers in a class or charged directly to the individual accident employer
The majority of stakeholders want LLODs excluded from individual employer experience

18. RG 755 Option Eliminated Funding modernization will eliminate RG 755
WSIB considering creating account for all EOs in construction
Will put all EOs into this account analogous to a separate class
Under current class experience would be a rate of $0.61 instead of current $0.20

19. More Information
Google WSIB Rate Framework Modernization

20. 20

21. Mental Stress Entitlement in Play
Bill 163 – presumptive PTSD leg for first responders
Bill 127 – allows entitlement for chronic mental stress claims

22. Purpose of Bill 163
Provides a presumption for 12 specified groups of workers that their PTSD condition arose out of and in the course of employment
If a worker covered by the legislation is diagnosed with PTSD by a psychiatrist or a psychologist and makes a claim for benefits, the WSIB must presume the condition is work-related, unless the contrary is shown
If worker not entitled to presumption, then s. 13 PTSD stream applies

23. Is worker entitled to the presumption?
Worker in one of the 12 FR categories
Employed as FR for at least one day
Has a DSM 5 diagnosis
Diagnosed with PTSD by a psychiatrist or psychologist
If yes to the above, then PTSD is presumed to have arisen out of and in the course of the first responder's employment, unless the contrary is shown

24. Exception for Employment Decisions
PTSD not compensable if caused by employer HR actions
terminations
demotions
transfers
discipline
changes in working hours, or
changes in productivity expectations

25. S. 13 WSIA -- Mental Stress Provision
S. 13 (5)  A worker is entitled to benefits for mental stress that is an acute reaction to a sudden and unexpected traumatic event arising out of and in the course of his or her employment.  However, the worker is not entitled to benefits for mental stress caused by his or her employer’s decisions or actions relating to the worker’s employment, including a decision to change the work to be performed or the working conditions, to discipline the worker or to terminate the employment.

26. Entitlement Criteria for s. 13 mental stress
To have entitlement the mental stress must be
an acute reaction
to a sudden and unexpected
traumatic event
arising out of and in the course of employment
Excludes benefits for mental stress caused by employer’s decisions or actions relating to the worker’s employment
Must be a DSM 4 diagnosis

27. Bill 127
Repeals current s. 13 and removes prohibition for CMS entitlement
WSIB issued new Mental Stress policy dealing with CMS under Policy for accidents on or after Jan 1, 2018
Traumatic Mental Stress (TMS) policy has been revised under Policy by removing the requirement that the event be ‘sudden and unexpected’.
Bill was passed and comes into force on Jan 1, 2018

28. Distinction Between TMS and CMS

29. WSIB Consulting on Draft MS Policy
Traumatic mental stress essentially the same as in current policy
A DSM (either 4 or 5) will do
A family doctor instead of a psychiatrist of psychologist can make diagnosis
CMS entitlement granted if disability caused by workplace bullying, harassment or interpersonal conflicts
Interpersonal conflicts between a worker and his or her supervisors, co-workers or customers are not generally considered a substantial work-related stressor unless the conflict results in behavior that is threatening or abusive, or unless the conflict generates conduct which amounts to workplace bullying or harassment.

30. Diagnostic Requirements
Before a mental stress claim adjudicated must be a DSM diagnosis which may include, but not limited to,
acute stress disorder
posttraumatic stress disorder
adjustment disorder, or
an anxiety or depressive disorder 
WSIB will accept the claim for adjudication if an appropriate health care professional (family doctor) provides the DSM diagnosis
WSIB decision-maker may subsequently require an assessment by a psychiatrist or psychologist to confirm ongoing entitlement

31. Issues to Consider
WSIB requires contributing factor to be predominant cause as test for work relatedness in CMS claims
WSIB relying on extensively on family doctors not psychologist / psychiatrist as diagnostician
WSIB focusing on RTW soon after diagnosis made
early and ongoing engagement with workers and employers to identify and mitigate the cause(s) of the workplace stress to encourage stay-at- work and/or return-to-work

32. Thank you.
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