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Bill 41 (2022): Significant Changes to the BC Workers Compensation Act

December 14, 2022

WorkSafeBC

Bill 41 (2022): Significant Changes to the BC Workers Compensation Act

With the many recent significant changes to the workers compensation system, understanding an employer’s obligations under the BC Workers Compensation Act (“WCA”) has never been more important. Bill 41- 2022: Workers Compensation Amendment Act (No. 2), 2022 (“Bill 41”) received Royal Assent on November 24, 2022, and contains further amendments to the WCA that increase employers' obligations to injured workers and have significant impact on both employers and employees.

Background on WCA Amendments

By way of background, since 2018, the BC Ministry of Labour has commissioned 5 lengthy and comprehensive reports reviewing various aspects of the compensation system. The reports can be found here. In summer of 2020, the Government started implementing some of these recommendations through amendments to the Workers Compensation Act. The amendments included increased worker benefits, Covid-19 related amendments, as well as new tools added for criminal prosecutions for serious health and safety violations.

Most of the amendments introduced with Bill 41 originate from the Workers Compensation System Review by Janet Patterson, report released in October, 2019. The Report is a mega-report which totals no less than 517 pages, and contains 102 Recommendations. It expanded on the “worker centered approach” that was mandated in the Petrie Report. Ms. Patterson is a former labour lawyer with a strong connection to the BC Federation of Labour.

In our view, the most significant aspect of Bill 41 is the introduction of two new statutory duties – the Duty to Cooperate and the Duty to Maintain Employment.

These duties will require both employers and workers to become much more active participants in claims.

Importantly, both duties are triggered when a worker:

  1. suffers an injury that arose out of and in the course of employment; and  
  2. is disabled from earning full wages as a result.

There needs to be an accepted WorkSafeBC claim and the worker has to be disabled from their pre-injury job in some way for these duties to be triggered.  

Another important point is that these duties apply to union and non-union settings. Section 154.4 of the Act says that if there is a conflict between these duties and the collective agreement, the WCB duties will take precedence if they are more generous to the worker.

Important note: at this time, these sections are not in force yet - they are going to come into force by regulation at some time in the future, so they do not yet apply to any current WorkSafeBC claims (as of December, 2022).  

More details about these duties below.

Duty to Cooperate

Section 154.2 creates a duty for both employer and worker to co-operate and work together with each other and with the Workers’ Compensation Board (the "Board") to facilitate the injured worker’s return to suitable work as soon as possible.  

The reciprocal duty to cooperate between the employer and the worker includes the following components:

  1. Contacting each other as soon as practicable after the injury and maintaining communication;
  2. Identifying suitable work for the worker that, if possible, restores the full wages the worker was earning pre-injury; and
  3. Providing the Board with information the Board requires in relation to the worker’s return to, or continuation of work.

The first component is essentially a duty to communicate, and it is reciprocal, so the injured worker also has an obligation to contact and communicate with the employer about coming back to work.  The section says if they don’t, then their benefits can be reduced or suspended until they do. The duty to communicate does not apply if, having regard to all of the circumstances, contact and communication between the employer and the worker are likely to imperil or delay the worker's recovery.

The second and third components introduce a formal obligation to identify suitable work with the goal of restoring the workers full earnings. This duty is just about providing the information, and only deals with identifying the work and giving the Board this information and whatever information the Board might require.  It does not deal with actually offering that work to the employee, that comes in the next section.

Dispute Resolution

If either the employer or the worker believes the other is not cooperating in the process, they can lodge a complaint to the Board, and the Board has to make a determination about the complaint within 60 days.  

If the employer is offside, they can be hit with a fine, if the worker is offside their benefits can be suspended.

Duty to Maintain Employment - Accommodating and Returning Injured Workers to Work

Most notably, the Bill 41 amendments establish a new legal duty requiring employers to maintain employment of injured workers and make any necessary changes to the work or workplace to accommodate their successful return to work, up to the point of undue hardship (section 154.3).

Exceptions: This duty applies only to employers with 20 or more workers, and in respect of workers who have been employed by the employer for at least 12 continuous months, and who have been unable to work as a result of a work-related accident.

This duty comes into play when the injured worker has been cleared to return to work by WorkSafeBC and there are two situations:

  1. A worker is “fit to work”, but cannot carry out the essential duties of their pre-injury work, the employer must offer the worker the “first suitable work that becomes available.”
  2. A worker is fit to carry out the essential duties of their pre-injury work, the employer must either (a) offer the same pre-injury work to the worker, or (b) offer the worker alternative work “of a kind and at wages that are comparable to the worker’s pre-injury work and wages from that work.”

What is “suitable work”? – that is not defined, so we think it will become the subject of much dispute. Do you have to offer work that that worker is not trained or qualified for? Probably not, because that is not suitable.  Do you have to create work that you don’t actually have?

This new duty to accommodate is separate from any obligations under BC’s Employment Standards Act, any employment or collective agreements, or the existing accommodation duty under the Human Rights Code, meaning employees will have the option of filing a claim with the Board or a complaint with the Human Rights Tribunal (or both) in connection with termination and accommodation issues relating to the same work-related illness or injury.

Limit to the Duty to Maintain Employment

An employer must make any change to the work or the workplace that is necessary to accommodate a worker, up to the point of undue hardship. Whether or not accommodating an injured worker amounts to undue hardship is a complex issue and requires a detailed analysis of the specific circumstances, including physical requirements, evidence of financial impact on the business and operations, etc.

These duties expire 2 years after the date of injury if the worker has not returned to work or if the worker is carrying out suitable work - this coincides with the concept of “frustration of employment.”

Employer’s Failure to Comply & Penalties – Six Month Rule

The amendments also include a built-in mechanism to ensure that employers comply with the duty to return injured workers to employment. If an employer terminates a worker within six months of their return to work, the employer will be deemed to have failed to comply with its legal duty to return the injured worker to work unless the employer can prove that the termination was unrelated to the worker’s injury.

If the employer is found to have breached the duty to re-employ, the Board may compensate the worker by paying them an amount equivalent to the compensation that the worker was entitled to pursuant to the temporary total or partial disability provisions of the WCA. In addition, the Board can impose an administrative penalty on the employer in an amount not exceeding the Board’s maximum wage rate for the applicable year - for 2023 maximum wage rate is $112,800!

There will be the usual right to seek a review to the Review Division or appeal to WCAT to challenge these fines but again that is more time and cost to employers and no guarantee they will win the appeal.

Other Changes Implemented with Bill 41

  1. Establishing an entirely independent Fair Practices Commission to hear complaints from workers, which would be funded by the Accident Fund;
  2. Giving employers and workers the right to request an Independent Health Professional to provide independent advice in a Workers’ Compensation Appeal Tribunal (WCAT) appeal;
  3. Requiring interest to be paid on compensation benefits that are determined by the Review Division of WorkSafeBC or WCAT to be owing to a person for 180 or more days;
  4. Adding explicit provisions against employers dissuading workers from filing claims, with enforcement through penalties under the WCA (claim suppression);
  5. Indexing workers’ compensation benefits to the full rate of annual percentage changes in the Canadian Consumer Price Index for cost of living increase (used to be CPI less one percent); and
  6. Increasing the maximum compensation for non-traumatic hearing loss, which is currently capped at 15% of a total disability when there is no loss of earnings.

Many of these amendments will result in increased claims and benefits costs, which means higher premiums for employers who fund 100% of the workers compensation system. This gives employers a further reason to ensure they understand their obligations under the WCA, and carefully evaluate employees who are injured at work as well as any WorkSafeBC claims started by their workers.

Please see the "Commencement" table at the end of the Bill for information as to when the various parts of the legislation will take effect – details below:

Employer Takeaways

  1. Given additional duties and obligations towards injured workers, employers should evaluate whether they wish to protest new WorkSafeBC claims. Once claim accepted, everything triggered.
  2. Avoid terminating workers returning from WorkSafeBC claims within the first 6 months. If you must terminate returning injured workers, make sure you document reasons very well.
  3. Communication is key – ensure early communication with worker and Board in event of a claim.
  4. Keep an eye out on Regulations to know when some of the amendments come into force.
  5. Take these obligations seriously – penalties can have a big impact.
  6. Get to know and follow the WCA provisions.
  7. Have good record keeping for: date of employment, injury date, termination date, length of time off work.
  8. Review human rights law around undue hardship concept.

Our experienced Employment & Disability Group is ready to assist you. Get in touch today.

Author

CHRIS DRINOVZ

Partner

Chris D. Drinovz is an experienced employment and labour lawyer and the head of the Employment & Labour Group at KSW Lawyers. He was born and raised in Surrey and has practiced law exclusively in the Fraser Valley since 2010. Chris’ expertise covers all facets of the workplace including wrongful dismissal, severance opinions, human rights, discrimination/harassment, employment standards, employment contracts and workplace policies, dismissal planning, employee investigations, pension & benefits, disability and other insurance claims, employment insurance...

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