DISCUSSION PAPER EXECUTIVE SUMMARY

Transcription

1 DISCUSSION PAPER EXECUTIVE SUMMARY 1. TITLE The Partners in Injury and Disability Prevention Program ( Partners Program ) 2. ISSUES The Partners Program is a voluntary incentive program intended to motivate BC employers to take a proactive role in occupational health and safety. Employers registered in the Partners Program who successfully meet the program requirements achieve a Certificate of Recognition ( COR ) and become eligible to receive a COR rebate. A recent decision of the Review Division has highlighted the following two issues with the Partners Program and the issuing of COR rebates: there is no policy established for the Partners Program to help guide decision-makers; and practice direction on whether an employer is considered to be in good standing, and, therefore, entitled to receive a COR rebate, is not well defined. As a result of this lack of clarity, the Chief Review Officer has suspended reviews of COR rebates where an employer has received an administrative penalty in that same calendar year. 3. OVERVIEW The Partners Program was developed through industry-based safety associations in partnership with WorkSafeBC. It was piloted in industry-specific sectors between 2000 and 2006, after which it was formally expanded to all employers in all industries across BC. Key to the administration of the program is cooperation with the certifying partners who are typically industry-specific health and safety associations. The certifying partners helped in the development of the program and the program s Standards and Guidelines ( Guidelines ). The Guidelines set out the obligations and duties of the participants of the program; certifying partners, employers, WorkSafeBC and auditors. The Guidelines are not policy, and therefore not binding on decision-makers. September 22, 2015 Page 1

2 The need to review the Guidelines has been highlighted by recent Review Division and WCAT decisions. These decisions show inconsistencies in how decision-makers determine whether an employer is in good standing and eligible for a COR rebate. This paper provides an overview of issues raised by the appellate bodies and a possible policy framework. Two draft policies are presented for stakeholder review and comment. Also, this paper invites stakeholders to comment on other significant issues related to the Partners Program. 4. FEEDBACK Stakeholders are invited to provide feedback on the discussion paper, options, and any additional comments that may be relevant to the issue. Stakeholder comments will be accepted until November 27, Contact information can be found in section 7 of the full Discussion Paper. September 22, 2015 Page 2

3 DISCUSSION PAPER 1. TITLE The Partners in Injury and Disability Prevention Program ( Partners Program ) 2. ISSUES The Partners Program is a voluntary incentive program intended to motivate BC employers to take a proactive role in occupational health and safety. Employers registered in the Partners Program who successfully meet the program requirements achieve a Certificate of Recognition ( COR ) and become eligible to receive a COR rebate. A recent decision of the Review Division has highlighted the following two issues with the Partners Program and the issuing of COR rebates: 1 there is no policy established for the Partners Program to help guide decision-makers, and practice direction on whether an employer is considered to be in good standing, and entitled to receive a COR rebate, is not well defined. As a result of this lack of clarity, the Chief Review Officer has suspended reviews of COR rebates where an employer has received an administrative penalty in that same calendar year. 3. BACKGROUND 3.1 Program Overview The Partners Program is designed to encourage injury prevention and the development of effective workplace health and safety management systems. The intent of the program is to recognize and reward employers who exceed occupational health and safety requirements, and to promote a corporate workplace safety culture. The Partners Program operates in cooperation with certifying partners. Certifying partners are independent agencies approved and contracted by WorkSafeBC to administer the program s requirements set out in the COR Standards and 1 Review Division Decision #R September 22, 2015 Page 1

4 Guidelines ( Guidelines ). 2 Certifying partners are typically industry-based safety associations that have in-depth knowledge on industry specific occupational health and safety practices. 3 There are two main elements to the Partners Program. The first is the COR certification requirement, and the second is the incentive, or COR rebate COR Certification To successfully achieve COR certification, employers work in cooperation with a certifying partner to meet the program s standards. This involves implementing occupational health and safety management systems. The scope and complexity of the management system required will vary according to the type of workplace and the nature of its business. Each employer s management system is evaluated by standardized audits, conducted by auditors who are qualified and trained by certifying partners. 4 After passing the certification audit, employers receive a COR. Once an employer successfully achieves a COR, annual maintenance audits are required to maintain certification. The COR certificate is valid for three years, after which a re-certification audit is required Health and Safety COR Rebate A COR rebate of 10% of the employers base premium is paid to employers who achieve a COR certification and who are in good standing with WorkSafeBC. The COR rebate is calculated using an employer s assessable payroll and classification unit ( CU ) base rate for the incentive year. The rebate offered under the Partners Program can be characterized as an advance against the reduced costs that will result from improved attention to health and safety. The COR rebate is a tool that can be used in addition to the incentives offered under the experience rating ( ER ) program. 5 A key difference from ER is that the Partners Program rewards an employer on their health and safety record for the current year. Conversely, the ER program looks at the employers experience over the previous three years The Guidelines were developed by the Partners Program Advisory Group comprised of representatives of industry and WorkSafeBC. Current WorkSafeBC certifying partners include: the BC Construction Safety Alliance, the BC Forest Safety Council, BC Maritime Employers Association, British Columbia Municipal Safety Association, Enform Canada (Petroleum), Farm and Ranch Safety and Health Association ( FARSHA ), Food Industry Occupational Safety Association ( FIOSA-MIOSA ), Alliance of BC, Go2 Tourism HR Society ( go2hr ), and Trucking Safety Council of BC. There are two types of auditors, internal and external. Small companies of 20 or less employees are only required to use internal auditors. See Item AP1-42-1, Experience Rating of the Assessment Manual. September 22, 2015 Page 2

5 3.1.3 Return to Work COR Prior to 2013, employers participating in the Partners Program were able to qualify for two incentives: a Health and Safety COR rebate of 10%, and a Return to Work ( RTW ) COR rebate of 5%. The RTW component of the COR program is temporarily frozen pending a review of this portion of the program. Work is underway to improve the audit tool and examine the need for further auditor training in this field. 6 Accordingly, references to the COR rebate in this discussion paper and the draft policies refer solely to the Health and Safety COR rebate. 3.2 History The Partners Program, in its current form, evolved from two pilot programs. While the pilot programs differed in their incentive structure and in their industry coverage, the main elements of these programs have remained largely consistent over the past ten years. They all emphasize the following: health and safety management systems intend to take employers beyond regulatory compliance; programs serve to increase awareness of health and safety issues among employers; and the importance of creating partnerships with industries in order to improve the safety culture of the workplace The Prevention Incentive Pilot Program ( PIP ) The PIP is an early version of the Partners Program created by a Resolution of the Panel of Administrators ( POA ) in April, The Prevention Division initiated the PIP as a pilot program that ran from May 1, 2000 to June 20, Seventy-three employers participated in the PIP program. The PIP represented an effort by the Prevention Division to experiment with innovative ways to promote workplace health and safety in BC. Fundamental to the PIP was minimal intervention on the part of WorkSafeBC. The PIP demonstrated the potential of industry safety associations to use incentives to encourage members to improve occupational health and safety performance. Following the PIP, WorkSafeBC decided to work with health and safety associations to support industry-led projects. 6 7 Employers with RTW COR or employers, who were in the process of receiving it at the time the program was frozen, were allowed to continue through the 3-year audit cycle. See Panel of Administrators Resolution 2000/03/ September 22, 2015 Page 3

6 3.2.2 The COR Pilot Program Subsequent to the PIP, the COR pilot was developed with input from health and safety organizations. The COR pilot was proposed by the BC Road Construction and Maintenance Safety Network and applied to that specific industry sector. The COR pilot was modeled after a similar program that had been offered for ten years in Alberta, the Partnership in Injury Reduction ( PIR ) program. There was widespread interest among industry associations in the COR pilot. It was proposed to run from January 1, 2003 to December 31, 2003 but was later extended. It was broadened to include the oil and gas industry in 2004 and the remainder of the construction industry in Partners Program Following both pilot programs, in 2006, the Board of Directors ( BOD ) approved the Partners Program, thus formally expanding the program to all employers in all industries in BC. 8 It should be noted that often the terms Partners Program and COR Program are used interchangeably. Initially, the Partners Program included a Health and Safety COR rebate (5%), a Disability Management (or RTW) COR rebate (2%) and a performance based rebate (1-8%). Following industry requests, the performance rebate was eliminated in 2009, so as to increase employer interest and participation. 9 The performance rebate was redistributed as an activity-based rebate of 10% for Health and Safety and 5% for RTW. However, as previously mentioned, the RTW COR was suspended in At present, the COR rebate paid through the Partners Program is the 10% Health and Safety rebate Measuring Outcomes of the Partners Program The Partnership for Work, Health and Safety at the University of British Columbia conducted a multi-year project to measure whether participation in the Partners Program improved occupational health and safety outcomes. 10 The study compared employers certified under the Partners Program with employers that were eligible but not certified in the program between Overall the study found that between , certified firms had, on average 12% lower disability and fatality rates compared to non-certified firms, and a 17% lower serious injury rate. See Appendix B for a research brief that outlines the study See BOD Resolution 2006/05/ See BOD Resolution 2008/03/ Evaluation of the effect of an audit-based occupational health and safety recognition program on firm work-injury in British Columbia. McLeod C, Quirke W, Koehoorn M. (2015). September 22, 2015 Page 4

7 3.3 Legal Framework Legislative Authority The Partners Program falls within the purpose of Part 3 of the Workers Compensation Act ( Act ) as well as WorkSafeBC s broad mandate to protect the health and safety of workers in BC. 11 The Act provides WorkSafeBC with power to develop programs and services that promote occupational health and safety. Specifically, WorkSafeBC has the authority to: provide services to employers in maintaining reasonable standards for occupational health and safety and occupational environment; 12 encourage, develop and conduct or participate in conducting programs for promoting occupational health and safety; 13 and cooperate and enter into arrangements and agreements on matters relating to occupational health and safety. 14 The health and safety component of the Partners Program fits within the authority provided in this framework. The cost of administrating the Partners Program is supported in both Parts 1 and 3 of the Act. 15 Section 42 allows WorkSafeBC to establish differentials and proportions in the rates as may be considered just. This supports the payment of COR rebates to employers who participate in the Partners Program Resolutions of the BOD and POA Historically, three separate Resolutions have provided the authority for the operation of the Partners Program. 16 The Resolutions are attached as Appendix C. The 2000 Resolution establishing the PIP program provides insight as to how the POA initially intended the rules governing disqualification from the COR rebate to be set out Sections 107 and 111 of the Act. Section 111(2)(c) of the Act. Section 111(2)(e) of the Act. Section 111(2)(k) of the Act. Sections 36 and 113(5) of the Act. POA Resolution 2000/03/16-05 and BOD Resolutions 2006/05/24-02 and 2008/03/ September 22, 2015 Page 5

8 The disqualification criteria in the 2000 Resolution provide that a participating employer may be disqualified from receipt of all or part of a credit under the program for: not complying with the Act; conviction in a court or an administrative penalty for a violation of the regulations made under the Act; suppressing claims for compensation or their costs; and other misconduct considered by the Board to be inconsistent with participating in the program. The disqualification criteria has evolved into the in good standing criteria. Most of the criteria is reflected in the current Guidelines. 17 The 2000 Resolution is the sole Resolution explaining the disqualification or in good standing criteria. With respect to the amount of the COR rebate, it is noted that the 2000 and 2006 Resolutions contemplate giving all or part of rebate under the program. 18 This has not been adopted by the current Guidelines and is not the approach in current practice. This has been raised as an issue by appellate bodies The Guidelines The Guidelines are the primary document which sets out the roles and responsibilities of the Partners Program participants, and is used as a practice document by staff and appellate bodies. The Guidelines are structured by way of obligations and duties of the participants of the program; certifying partners, employers, WorkSafeBC and auditors The in good standing Criteria The Guidelines provide that, in order to receive a COR rebate, employers must be in good standing with WorkSafeBC. Section 3.9 of the Guidelines state that an employer is in good standing if it: is registered and is in the correct classification unit(s); is up to date with respect to payment of assessment payments; and does not have outstanding compliance issues The COR Standards and Guidelines. POA Resolution 2000/03/16-05 and BOD Resolutions 2006/05/ See section 3.5 Appellate Review of this paper for further discussion. See the following sections of the Guidelines: Certifying partners 1.1 through 1.11, employers 2.1 through 2.6, WorkSafeBC 3.1 through 3.15, auditors 4.1 through September 22, 2015 Page 6

9 Sections 2.6 and 3.9 of the Guidelines further list a number of conditions that may or would make a participating employer ineligible: the employer has engaged in activity which would cause WorkSafeBC to consider imposing, or has resulted in WorkSafeBC imposing, an administrative penalty; 21 the employer has suppressed claims for compensation or suppressed claims costs; 22 the employer has an outstanding balance related to its WorkSafeBC employer account; the employer has failed to register with WorkSafeBC; the employer has not reported payroll to WorkSafeBC for the audit year; or the employer has engaged in other misconduct considered by WorkSafeBC to be inconsistent with participation in the Partners Program. In its current form, the Guidelines do not explicitly state that employers engaged in an activity that has resulted in a conviction under the Act are disqualified from their COR rebate. Convictions under the Act were initially included in the disqualification criteria set out in the 2000 Resolution The COR Rebate Section 2.6 of the Guidelines provides that an employer will be ineligible for a COR rebate until the condition creating the ineligibility has been resolved. In practice, staff in the Industry and Labour Services ( ILS ) department will look to see if anything disqualifies the employer from receiving their COR rebate before issuing the payment. If there is the potential for an administrative penalty, staff will place the payment on hold pending a final determination. If there are other errors related to reporting payroll or an outstanding balance, staff will hold the payment until the employer is notified of the oversight and given an opportunity to remedy it. The Guidelines are not clear on how to determine the calendar year to which an ineligibility condition (e.g. an administrative penalty) relates. 23 In practice, staff use the year in which the activity or incident occurred. If there are multiple activities over time that lead to the imposition of an administrative penalty, then staff will determine the triggering event and use that calendar year. The Guidelines also do not provide direction on how WorkSafeBC recoups rebates See Policy D Administrative Penalties Criteria for Imposing of the Prevention Manual. The Act and policy do not use the terms claims suppression but instead refer to prevent reporting under section 177. Section 2.6 of the Guidelines. September 22, 2015 Page 7

10 that have already been paid before it has been determined the employer was ineligible Appellate Review Review Division Decision #R and WCAT Decision have highlighted the need to clarify the in good standing criteria. 25 The two Decisions involve a review of a decision to remove an employer s COR rebate. At issue in both Decisions was whether the employer is entitled to a COR rebate for the same calendar year in which they had received an administrative penalty. Both the Review Division and the WCAT Decisions begin by highlighting inconsistencies in sections of the Guidelines that provide guidance to decisionmakers and employers on whether an employer is considered to be in good standing. In particular, the Decisions note that sections 2.6 and 3.9 of the Guidelines are not consistent with the use of the words may, would and will. This inconsistency is confusing to decision-makers and raises questions on whether the in good standing criteria is mandatory or discretionary. Despite the inconsistent use of language, both the Review Division and the WCAT determine that they are not bound by the Guidelines and follow with an analysis of other issues presented by the current in good standing criteria The WCAT Decision The WCAT Decision raised two key issues with the current in good standing criteria as presented in the Guidelines. First, the Guidelines are inconsistent with the 2006 BOD Resolution. As previously mentioned, both the 2000 and 2006 Resolutions contemplate a rebate of all or part of the rebate under the program. The Guidelines are clear that the existence of an administrative penalty is a bar to the whole rebate. The WCAT Decision establishes a more nuanced approach than the all or nothing approach contemplated by the Guidelines. Ultimately, the WCAT determined that the employer was eligible to receive 50% of their COR rebate, despite receiving an administrative penalty in that same calendar year For example, when WorkSafeBC discovers that an employer has not fully reported their payroll for a previous year in which a COR rebate had already been paid. Based on the Review Division Decision #R , the Chief Review Officer has suspended reviews of COR rebates pending policy clarification. September 22, 2015 Page 8

11 The WCAT s decision to reduce the COR rebate is linked with the second issue related to the in good standing criteria. The Guidelines do not allow for an element of discretion in considering the factors that give rise to the administrative penalty. Excluded are concepts of proportionality related to the seriousness of the infraction, the size of the employer and other relevant circumstances. For example, a large employer with multiple operations in a variety of industrial sectors might receive a Category B penalty 26 but still lose its entire COR rebate The Review Division Decision The Review Division raises the same issues as the WCAT Decision and further expands on other factors that should be weighed when considering discretion. These factors include the nature and number of violations, the period of time over which the violations occurred, the location of the violations, the employer s safety record, whether the activity related to the penalty represent a total failure of the employers program, among other issues. To better reflect fairness and proportionality, both the Review Division and the WCAT applied discretion and determined that, based on the circumstances, the employer was entitled to part of their COR rebate. 3.6 Statistics and Costing The Partners Program is administered by ILS with a staff of six that includes a manager, business planning analysts and industry specialists. The Partners Program currently has over 3,700 COR certified employers receiving over $40 million in rebate payments. The administration costs of the Program are approximately $6.5 million Policy D Administrative Penalties Amount of Penalty of the Prevention Manual. Category B penalties are for violations that do not result in serious injury or illness or death; or high risk of serious injury or illness or death; or non-compliance was willful or with reckless disregard. Administration costs for the Partners Program are paid from the aggregate. The COR rebates are paid from the rate level. September 22, 2015 Page 9

12 The following two tables illustrate the growth of the Partners Program over the past ten years COR Certified Employers $45,000,000 $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 Incentive Paid by COR Certification year RTW OHS September 22, 2015 Page 10

13 4. OTHER JURISDICTIONS Six jurisdictions have voluntary incentive programs that are similar in scope to BC. The following table provides an overview of similar programs in other jurisdictions: Voluntary program? AB SK MB ON NB NS NFLD PEI YK NWT PQ Program in policy? Program outside of ER? Incentive payment? 20% 10% 6-10% Administered by 3 rd party? COR and 28 5% 10% SECOR? 29 in good standing criteria? Rebate performance based? See Appendix D for a detailed interjurisdictional discussion. 5. DISCUSSION The appellate decisions have highlighted the need to establish policy and clarify the in good standing criteria. What follows is a discussion of the issues raised by the appellate bodies and a possible policy framework. Through consultation, further issues may be identified that would require further review. 5.1 Overview of Issues Is the in good standing Criteria Discretionary? The appellate decisions have questioned whether the in good standing criteria should be discretionary. They note that it would be inconsistent with the overall intention of the Partners Program to cancel a rebate just because there is a violation of the Act. The appellate decisions establish factors that should be considered when determining whether the employer is in good standing. 30 Overall these factors relate to the general theme of fairness for employers New Brunswick uses a refund stabilization account. See Appendix D for more information. Certification of Recognition (COR) and Small Employer Certificate of Recognition (SECOR). See section 3.5 Appellate Review of the Discussion Paper. September 22, 2015 Page 11

14 5.1.2 Giving a Partial COR Rebate Also identified by the appellate decisions is that the current Guidelines do not allow for a partial COR rebate. The appellate decisions refer to the Resolutions as authority for giving partial rebates. An issue to be considered is whether the all or nothing approach set out in the Guidelines and the flexible approach envisioned by the Resolutions can be reconciled Fairness in Employer Registration The facts of the Review Division Decision also highlight that the method by which an employer registers for the purposes of the COR program can result in unfairness. In the case before the Review Division, the employer had activities in five CUs. The employer was registered in a way that combined the CUs for the purposes of the COR certification. As a result, a penalty in one of the employer s CUs potentially had a disproportionate impact on the company as a whole. The Guidelines are silent on how firms should be certified for the purposes of the Partners Program (e.g. by legal entity, by divisional account, or if it should be CU specific). Currently, employers are registered at the account CU level. However, there are some employers with one account but multiple operating locations and CUs. These employers may be at a competitive disadvantage with other employers who may take a divisional approach to registration, having multiple accounts instead of just one. This is an issue that is commonly raised by stakeholders. 5.2 Establishing a Policy Framework When considering policy options, it is important to recognize that one of the fundamental elements of the Partners Program is delivery through WorkSafeBC certifying partners. The program was developed by WorkSafeBC in partnership with industry and represents a combined effort of WorkSafeBC and an advisory board of industry certifying partners. The unique nature of the Partners Program requires full consultation on any fundamental changes to it. Accordingly, the Policy, Regulation and Research Division ( PRRD ) proposes a simplified policy framework that codifies current practice as previously developed in consultation with certifying partners and other stakeholders. This addresses the immediate need for the development of policy while also providing stakeholders the opportunity during consultation to provide feedback on all of the potential issues related to the Partners Program for future review. The draft policies codify the current in good standing criteria from the Guidelines and add one additional criterion to the in good standing list, convictions by a Court for a violation under the Act. Existing criteria on claims suppression and suppressed claims costs has also been changed to more accurately reflect the language in the Act and policy. September 22, 2015 Page 12

15 As the legislative authority for the Partners Program exists in both Part 1 and Part 3 of the Act, it is necessary to develop policy in both the Assessment Manual (to reflect the COR rebate component of the program) and the Prevention Manual (to reflect the occupational health and safety component of the program). Draft policies reflecting this option are attached as Appendix A. 6. OPTIONS AND IMPLICATIONS Option 1: Status quo Implications The immediate need for policy identified by the Chief Review Officer would not be addressed. Reviews of COR rebates would continue to be suspended. There would continue to be a lack of clarity for decision-makers with respect to the in good standing criteria. Option 2: Establish policy for the Partners Program in both the Assessment Manual and the Prevention Manual that reflects current practice. Under this option, policy would be created to set out the Partners Program and clarify the in good standing criteria from the Guidelines. Stakeholders will have an opportunity to discuss any other issues related to the Partners Program during consultation. Implications Establishing policy for the Partners Program would address the immediate need for policy identified by the Chief Review Officer. Establishing policy for the Partners Program would provide guidance for decision-makers. The in good standing criteria would be clarified. There would continue to be no discretion to award a COR rebate at a reduced rate where an employer receives an administrative penalty. There would continue to be no discretion to consider the employer s size, location, safety record or other factors when determining whether an employer is entitled to their rebate. Lack of clarity on how employer s register for the purposes of COR may lead to potential unfairness among employers. September 22, 2015 Page 13

16 Establishing policy for the Partners Program reflects the approach in six other jurisdictions that have policy for similar programs. 7. CONSULTATION Stakeholders are invited to provide feedback on the discussion paper, options, draft policy, and any additional comments that may be relevant to the issue. Stakeholder comments will be accepted until November 27, When responding, please provide your name, organization, and address. Comments may be sent by mail, fax or to: By By mail: Valerie Vojnic Senior Policy and Legal Advisor Policy, Regulation and Research Division WorkSafeBC P.O. Box 5350, Stn. Terminal Vancouver, B.C. V6B 5L5 By fax: Please be advised that stakeholders will not be contacted regarding the contents of their submissions unless clarification is needed. WorkSafeBC s governing body, the Board of Directors, will consider stakeholder feedback before it adopts any amendments to the current policies. Please note that all comments become part of the Policy, Regulation and Research Division s database and may be published, including the identity of organizations and those participating on behalf of organizations. The identity of those who have participated on their own behalf will be kept confidential according to the provisions of the Freedom of Information and Protection of Privacy Act. September 22, 2015 Page 14

17 APPENDIX A DRAFT POLICY ASSESSMENT MANUAL RE: Partners in Injury and Disability ITEM: AP Prevention Program ( Partners Program ) BACKGROUND 1. Explanatory Notes This policy sets out the framework for the Partners Program. The Partners Program is a voluntary employer incentive program intended to motivate employers to take a proactive role in complying with and exceeding the occupational health and safety requirements found in Part 3 of the Act. 2. The Act Section 36 (in part): (1) The Board must continue and maintain the accident fund for payment of the compensation, outlays and expenses under this Part and for payment of expenses incurred in administering Part 3 of the Act. See Item AP Section 111 (in part): (1) In accordance with the purpose of this Part, the Board has the mandate to be concerned with occupational health and safety generally, and with the maintenance of reasonable standards for the protection of the health and safety of workers in British Columbia and the occupational environment in which they work. (2) In carrying out its mandate, the Board has the following functions, duties and powers: (c) to provide services to assist joint committees, worker health and safety representatives, employers and workers in maintaining reasonable standards for occupational health and safety and occupational environment; September 22, 2015 AP Page 1

18 APPENDIX A DRAFT POLICY ASSESSMENT MANUAL (e) to encourage, develop and conduct or participate in conducting programs for promoting occupational health and safety and for improving the qualifications of persons concerned with occupational health and safety and occupational environment; (k) to cooperate and enter into arrangements and agreements with governments and other agencies and persons on matters relating to its responsibilities under this Part; Section 113 (in part): (5) The Board may charge a class or subclass with the cost of investigations, inspections and other services provided to the class or subclass for the prevention of injuries and illnesses. POLICY 1. DESCRIPTION OF TERMS Certificate of Recognition ( COR ) A COR is a certificate issued to employers who have successfully implemented a occupational health and safety management system under the Partners Program. Certifying Partner A certifying partner is an independent agency approved and contracted by the Board to implement the Partners Program and monitor employer compliance with program requirements. 2. GENERAL The Partners Program is a voluntary employer incentive program designed to encourage injury prevention and the development of effective occupational health and safety management systems. The Partners Program promotes a workplace safety culture by recognizing and rewarding employers who exceed occupational health and safety requirements. All employers are eligible to participate in the Partners Program. To participate, employers must be registered with the Board and maintain an active account. September 22, 2015 AP Page 2

19 APPENDIX A DRAFT POLICY ASSESSMENT MANUAL There are two components to the Partners Program. The first is to recognize employers through program certification. The second is to provide eligible employers with an incentive rebate of 10% of the employer s base assessment premiums. (a) COR Certification Employers work with Board certifying partners to meet the program s standards and achieve a COR. The COR certification requirements are as follows: 1) the employer registers with a certifying partner; 2) the employer implements an occupational health and safety management system as specified by the certifying partner; and 3) the employer passes certification and annual maintenance audits. An employer s COR certificate is valid for three years, after which a re-certification audit is required. The Board is responsible for setting minimum audit standards and approving audit tools. (b) COR Rebate An employer with a valid COR certification may be eligible to receive a 10% rebate on their assessment premiums. COR rebates are eligible to be paid commencing in the year following COR certification. An employer must be in good standing with the Board in order to receive a COR rebate. An employer is not in good standing if: the employer has engaged in activity which would cause the Board to consider imposing, or has resulted in the Board imposing, an administrative penalty; the employer is convicted by a Court of a violation of the Act; the employer has prevented or attempted to prevent reporting to the Board as outlined under section 177 of the Act; the employer has reduced claim costs in a manner that is contrary to the Act or Board policy; the employer has an outstanding balance related to its account; the employer has not reported payroll to the Board for the audit year; or September 22, 2015 AP Page 3

20 APPENDIX A DRAFT POLICY ASSESSMENT MANUAL the employer has engaged in other misconduct the Board considers to be inconsistent with participation in the Partners Program. Employers who are not in good standing will not receive a COR rebate for the year in which the activity or incident occurred. PRACTICE For any relevant PRACTICE information, readers should consult the Practice Directives available on the WorkSafeBC website at EFFECTIVE DATE: AUTHORITY: CROSS REFERENCES: HISTORY: APPLICATION: TBD ss. 36, s. 42, s. 111, and 113(5), Workers Compensation Act. See also Administrative Penalties Criteria for Imposing (Prevention Manual D ) and Partners in Injury and Disability Prevention Program (Prevention Manual D ). The amended policy applies to all decisions, including appellate decisions, made on or after TBD. September 22, 2015 AP Page 4

21 APPENDIX A DRAFT POLICY PREVENTION MANUAL RE: Partners in Injury and Disability ITEM: D Prevention Program ( Partners Program ) BACKGROUND 1. Explanatory Notes The Partners Program is a voluntary employer incentive program intended to motivate employers to take a proactive role in complying with and exceeding the occupational health and safety requirements found in Part 3 of the Act. 2. The Act Section 36 (in part): (1) The Board must continue and maintain the accident fund for payment of the compensation, outlays and expenses under this Part and for payment of expenses incurred in administering Part 3 of the Act. Section 42: The Board must establish subclassifications, differentials and proportions in the rates as between the different kinds of employment in the same class as may be considered just; and where the Board thinks a particular industry or plant is shown to be so circumstanced or conducted that the hazard or cost of compensation differs from the average of the class or subclass to which the industry or plant is assigned, the Board must confer or impose on that industry or plant a special rate, differential or assessment to correspond with the relative hazard or cost of compensation of that industry or plant, and for that purpose may also adopt a system of experience rating. Section 111 (in part): (1) In accordance with the purpose of this Part, the Board has the mandate to be concerned with occupational health and safety generally, and with the maintenance of reasonable standards for the protection of the health and safety of workers in British Columbia and the occupational environment in which they work. September 22, 2015 D Page 5

22 APPENDIX A DRAFT POLICY PREVENTION MANUAL (2) In carrying out its mandate, the Board has the following functions, duties and powers: (c) to provide services to assist joint committees, worker health and safety representatives, employers and workers in maintaining reasonable standards for occupational health and safety and occupational environment; (e) to encourage, develop and conduct or participate in conducting programs for promoting occupational health and safety and for improving the qualifications of persons concerned with occupational health and safety and occupational environment; (k) to cooperate and enter into arrangements and agreements with governments and other agencies and persons on matters relating to its responsibilities under this Part; Section 113 (in part): (5) The Board may charge a class or subclass with the cost of investigations, inspections and other services provided to the class or subclass for the prevention of injuries and illnesses. POLICY See Assessment Manual AP for the policy. EFFECTIVE DATE: AUTHORITY: CROSS REFERENCES: HISTORY: TBD ss. 36, s. 42, s. 111, and 113(5), Workers Compensation Act. See also Administrative Penalties Criteria for Imposing (Prevention Manual D ) and D , Partners in Injury and Disability Prevention Program (Prevention Manual D ). September 22, 2015 D Page 6

23 APPENDIX A DRAFT POLICY PREVENTION MANUAL APPLICATION: The amended policy applies to all decisions, including appellate decisions, made on or after X. TBD. September 22, 2015 D Page 7

24 APPENDIX B Research BRIEF An audit-based occupational health and safety recognition program: Is certification associated with lower firm work-injury rates? Background The Partners in Injury and Disability Prevention Program, established by WorkSafeBC (the workers compensation system in BC, Canada), is a voluntary program that recognizes and rewards employers who exceed legislative and regulatory requirements in implementing occupational health and safety (OHS) and return-to-work programs. The intent is to reduce workplace injuries and assist injured workers in making an early, safe return to meaningful work. WorkSafeBC first piloted the program in 2002 in the construction sector, then expanded to the oil and gas sector in 2004 and to all industry sectors in Employers who pass an audit of their OHS practices receive a Certificate of Recognition (COR) and are eligible for a rebate of 10% of their WorkSafeBC premium. Voluntary audit-based certification as a way of recognizing or encouraging effective OHS practices is a common approach of regulators in Canada and internationally. However, there has been little research examining whether these programs lead to improved OHS outcomes. We evaluated whether COR certification was associated with lower firm-level injury rates in BC by comparing certified firms to non-certified, but eligible, firms from 2002 to Based on research presented in: McLeod C, Quirke W, Koehoorn M. (2015). Evaluation of the effect of an audit-based occupational health and safety recognition program on firm work-injury rates in British Columbia, Canada. Final Report to WorkSafeBC. Vancouver: Partnership for Work, Health and Safety, University of BC. Approach We used an observational research design. Certification is voluntary and firms self-select into the program. Participating firms, by the very nature of choosing to become certified, are different than non-participating firms. Self-selection into voluntary programs is a central challenge in assessing whether program participation has a causal effect (i.e., that any changes in injury rate are due to participation in the program and not due to other factors). We used a difference-in-difference evaluation methodology that can identify change attributed to an intervention (the COR program). This approach utilizes a control group (the non-certified firms) and identifies two differences: (1) the difference between the certified and non-certified firms pre-intervention and (2) the difference between the certified and non-certified firms post-intervention. The impact of the intervention is the sum of these two differences.

25 APPENDIX B PA R T N E R S H I P F O R W O R K, H E A LT H A N D S A F E T Y R E S E A R C H B R I E F What we found Overall Certified firms had, on average, a 12% lower short-term disability, long-term disability and fatality (STD, LTD, and fatality) injury rate between 2005 and 2012 compared to non-certified firms, and a 17% lower serious injury rate. We found no difference in the health care only claim rate. Over time Certification was associated with a lower injury rate for both STD, LTD and fatalities and for serious injuries across all years of the study. In the years with the largest number of certified firms (2009 to 2012), the reduction in the STD, LTD and fatalities injury rate ranged between 10% and 16% and the reduction in the serious injury rate ranged between 14% and 17%. Across sectors We examined construction, forestry, manufacturing and transportation/warehousing firms separately. Certified firms in construction and forestry had, on average, 12% and 16% lower STD, LTD and fatality rates and 16% and 21% lower serious injury rates compared to non-certified firms, respectively. The reduction in these injury rates was largest between 2009 and 2012 for construction firms, while the reduction was similar between 2007 and 2012 for forestry firms. Small reductions or no differences in injury rates were observed between certified and non-certified firms in manufacturing and transportation/warehousing. What are serious injuries? Short-term (at least one day of time loss) or long-term disability claims with at least one of: long duration (>28 days of wage loss); high costs (equivalent to 28 days of wage loss); serious medical diagnosis (e.g., fractures); or fatality. Figure Effect of COR certification on injury rates, by type of injury rate, over time, and across sectors Overall STD, LTD & fatalities Serious injuries Health care only Over time STD, LTD & fatalities Serious injuries Across sectors STD, LTD & fatalities Construction Forestry Manufacturing Transp./warehousing Serious injuries Construction Forestry Manufacturing Transp./warehousing A certified firm has a lower injury risk than a non-certified firm A certified firm has a higher injury risk than a non-certified firm Rate ratio of effect of certification, with 95% confidence interval Injury rate estimates below 1.0 indicate that certified firms have lower injury rates than non-certified firms. Smaller estimates indicate correspondingly lower rates. Where confidence intervals cross 1.0, the difference in the injury rate may be due to chance. W W W. P W H S.U B C.C A

26 APPENDIX B PA R T N E R S H I P F O R W O R K, H E A LT H A N D S A F E T Y R E S E A R C H B R I E F What this means COR program participation is associated with lower injury rates, particularly in the construction and forestry sectors and in the years 2009 to Our interpretation of this finding is that the COR audit process is effective at identifying firms with lower work injury risk; however, caution should be exercised in inferring that certification itself caused any reduction in injury risk. While the difference-in-difference evaluation design attempts to account for pre-certification differences in injury risk between certified and non-certified firms, we cannot rule out that certification served as a marker for existing OHS practices (or other factors) that drove changes in injury risk once a firm became certified. Future research should be focused in three areas: (1) ongoing monitoring of the effectiveness of the program; (2) investigation of how the certification process facilitates change in firm OHS practices; and (3) assessment of the audit tool to improve its efficiency and to incorporate evolving OHS best practices. More information Please contact Chris McLeod, PWHS Co-Lead, at chris.mcleod@ubc.ca with questions about the methods, results, or interpretation of this evaluation, or to request a copy of the full report. General enquiries should be directed to Suhail Marino, PWHS Program Manager, at suhail.marino@ubc.ca. W W W. P W H S.U B C.C A

27 WORKERS' COMPENSATION BOARD g6 rte APPENDIX C PANEL OF ADMINISTRATORS Maureen Nicholls, Chair George Heyman Eric Mittemdorfer Valerie Mitchell Wolfgang Zimmermann WORKERS' COMPENSATION BOARD OF BRITISH COLUMBIA RESOLUTION OF THE PANEL OF ADMINISTRATORS 2000/03/16-05 RE: PREVENTION INCENTIVE PILOT PROGRAM WHEREAS: Pursuant to Section 82 of the Workers Compensation Act, RSBC 1996, Chapter 492 and amendments thereto, the Panel of Administrators (the "Panel") must approve and superintend the policies and direction of the Workers' Compensation Board; AND WHEREAS: In Resolution # "Re: Experience Rating", dated October 13, 1999, the Panel directed the Administration to consult with stakeholders on rate modification programs that consider factors other than claims costs, and bring the resulting pilot projects to the Panel for approval such that evaluation of the pilots may take place in Quarter One, 2001, with full implementation by the end of Quarter Two, 2001; AND WHEREAS: The Panel directed that the factors to be considered in the development of the rate modification programs include claims frequency and severity, health and safety program audits, rehabilitation and return to work programs and other factors as deemed appropriate; AND WHEREAS: The Prevention Division has consulted with stakeholders in the development of a pilot project that addresses some of the factors identified in Resolution # , and the Administration is in the process of developing additional proposals for approval that address the remaining factors; Location: 6951 Westminster Highway Richmond BC V7C 1C6 Telephone Toll Free Fax Mailing Address: PO Box 5350 Vancouver BC V6B 5L5

28 WORKERS' COmPENSATION BOARD raru<: AND WHEREAS: APPENDIX C The timeframe set out in Resolution # does not allow sufficient time for developing, implementing and fully evaluating the pilot projects; THE PANEL OF ADMINISTRATORS RESOLVES THAT: 1. The Prevention Incentive Pilot Program (the "Program") as described in the attached Appendix is approved; 2. The Prevention Division is authorized to conduct the Program in accordance with the attached Appendix ("Description of Prevention Incentive Pilot Program"); 3. The timeframe of the Incentive Pilot Program will be from May 1, 2000 to June 30, The Prevention Division is directed to return to the Panel in October/November 2000 to review progress to date, with a view to incorporating the full range of components as envisaged in the Panel resolution # The Division will report to the Panel shortly after June 30, 2001 on the Incentive Pilot Program, including a recommendation regarding full implementation of all components of the rate modification program addressed by the Program; 4. The Administration will continue to consult with stakeholders to ( address all the factors identified in Resolution # in order that full implementation may occur no later than Quarter Two, 2001; 5. This resolution constitutes a policy decision of the Panel of Administrators. DATED at Richmond, British Columbia, April 28, By the Workers' Compensation Board MAUREEN NIC CHAIR, PANEL 0 LLS DMINISTRATORS

29 APPENDIX C APPENDIX DESCRIPTION OF PREVENTION INCENTIVE PILOT PROGRAM A. INTRODUCTION The Prevention Incentive Pilot Program represents an effort by the Prevention Division to experiment with innovative ways to promote workplace health and safety in British Columbia. The goal is to identify new or improved ways to: reduce injury, severity, and claim costs, encourage employers and groups to go beyond regulatory compliance by taking more control of their safety issues, to develop new ways to reduce the losses associated with workplace injury, to develop grass roots safety solutions, to independently seek advice regarding their safety concerns and issues, promote health and safety as business norms, create a forum for public recognition of success, promote knowledge-sharing between employers and workers, encourage improved rehabilitation and return to work, create financial gains for all concerned. B. FEATURES Fundamental to the program is minimal intervention on the part of the Workers' Compensation Board (the "Board"). Participants will form groups that are meaningful to them. The Board will credit to the account of participants a percentage of any demonstrable savings in their claim costs over year 2000, subject to the level of performance in other areas. At this stage in the development of the pilot, the amount of the credit would depend on the degree of improvement in injury severity and the number of wage loss claims. Other criteria are to be added through the pilot year, such as rehabilitation and return to work and health and safety program audits. As discussed below in the Terms of Participation, the pilot has the following general features: Performance-based: participants can only earn rewards by achieving measurable results, Employer participation is voluntary, ( Administration is elective (groups must organise themselves with minimal Board assistance), Awards are separate from experience rating discounts or surcharges,

30 No risk- employers may earn a reward, but there are no surcharges or penalties if improvements are not realised, Employers from different classifications can participate in the same group, There are no conditions on prior injury or claims cost performance, Retrospective credits to account are offered at the close of year 2000, after employers' payroll information has been obtained (between March and June 2001). C. TERMS OF PARTICIPATION APPENDIX C The following points describe the terms and conditions under which the Pilot Program will be implemented. Terms of Entry 1. The program will be operated up until June 30, Participant employers may sign up no later than April 30, Each participating employer must have been registered with the Board as an employer prior to January 1, 1999 and have reported assessable payroll for The majority of employers participating in a group must have been operating for three full years prior to January 1, Each group of participating employers must have had a minimum combined annual base assessment of $150,000 in Participation is voluntary, and no surcharges will be applied as a result of participation. Calculating Improvement 5. The awards provided by the program are based on: reductions in injury severity, and reductions in the number of short term disability claims, and the derived savings in claims costs. 6. For the purpose of determining whether there has been a reduction in injury severity and in the number of short term disability claims, injury severity is represented by the median days lost by type of claim, an index for each employer participating in the group is obtained for each of the years 1997 to 2000 that relates the median days lost by type of claim and the number of short terms disability claims in each year to the

31 APPENDIX C an index for each employer participating in the group is obtained for each of the years 1997 to 2000 that relates the median days lost by type of ( claim and the number of short terms disability claims in each year to the results for their rate group, a combined index is then calculated for the group by comparing the results for the year 2000 with the results for the years 1997 to 1999, which represents the overall ratio of actual to expected injury severity and short term disability claims. 7. For the purpose of determining the derived savings in claim costs, the types of cost used are the same as those applied to experience rating, (see Assessment Policy 30:50:52), and are accumulated until June 30, 2001, per-claim costs are subject to a maximum equal to the maximum assessable wage ($58,000 in 2000), the claim costs for any year means the costs that are charged to the participants' classification units in that year on claims commenced in that year and the prior two years, the average for each employer participating in the group and the average for their rate group is taken for the period 1997 to 1999 and compared with the average for 1999 to 2000, and a comparison is then made between the result for each employer and their rate group, and a savings in claim costs will be derived when the average of the employer has improved relative to the previous experience of itself and its rate group. Maximum Financial Exposure 8. Where the total awards determined for all participating groups exceed $200,000 multiplied by the number of groups, the award of each group having a total award exceeding $200,000 will be reduced in proportion to the amount of its award until the total awards equal $200,000 multiplied by the number of groups. Groups whose awards do not reach $200,000 will not be affected by the reduction. Form and Particulars of the Incentive 9. The awards take the form of credits to each participating employer's account. The total amount credited to a group is allocated amongst participants in proportion to their contribution to their group's combined base assessment during the years 1999 to 2000.

32 APPENDIX C 10.The awards of individual members of a group (calculated in 7 above) may be differentiated according to rules specified by their group and/or by their group's coordinating agency, and agreed to by the Board, provided that the group submits the required information to the Board prior to May 30, The awards will not reduce the assessment paid by an employer in respect of the pilot year below the minimum annual assessment of $ The awards are separate from employers' experience rating discounts or surcharges and will be credited following June 30, 2001, after the Board has received all the required information and made the necessary determinations. Disqualification 13.Participants are not exempted from compliance with any of the provisions of the Workers Compensation Act (the Act) and regulations. 14.A participating employer may be disqualified from receipt of all or part of a credit under the program for: not-complying with the Act, conviction in a court or an administrative penalty for a violation of the regulations made under the Act, ( suppressing claims for compensation or their costs, and other misconduct considered by the Board to be inconsistent with participating in the program. 15.Groups will not benefit from the experience of disqualified firms. Audit and Evaluation 16.Participants may be subject to inspection or audit by the Board prior to awards being distributed. 17. Participants are required to participate in the Board's evaluation of the pilot program.

33 APPENDIX C BOARD OF DIRECTORS Douglas J. Enns, Chair David Anderson Terry Brown Stephen Hunt Roslyn Kunin Peter Morse Arlene Ward 2006/05/24-02 THE WORKERS COMPENSATION BOARD OF BRITISH COLUMBIA RESOLUTION OF THE BOARD OF DIRECTORS Re: Partners In Injury and Disability Prevention Program WHEREAS: Pursuant to section 82 of the Workers Compensation Act, RSBC 1996, Chapter 492 and amendments thereto ("Act ), the Board of Directors ("BOD") must set and revise as necessary the policies of the Workers' Compensation Board ("Board"), including policies respecting compensation, assessment, rehabilitation and occupational health and safety; AND WHEREAS: The Partners in Injury and Disability Prevention Program ( Partners Program ) is an employer incentive program designed to encourage injury prevention and the development of effective workplace health and safety and return to work management systems; AND WHEREAS: The Partners Program supports WorkSafeBC s primary goal of promoting occupational health and safety in the workplace and is consistent with the Board s strategic initiatives to encourage employers to focus on occupational health and safety and return to work, through the implementation of management systems and participation in Certificate of Recognition ( COR ) programs; AND WHEREAS: The Partners Program is consistent with the Board s functions, duties and powers in carrying out its mandate under the Act; Mailing Address Location Telephone PO Box 5350 Stn Terminal 6951Westminster Highway Fax Vancouver BC V6B 5L5 Richmond BC V7C 1C6 worksafebc.com

34 APPENDIX C THE BOARD OF DIRECTORS RESOLVES THAT: 1. The Board shall implement the Partners Program consisting of a: Health and Safety COR Program Return to Work COR Program Performance Management Program a) The Board may reduce, vary, adjust or refund assessments otherwise payable by employers who participate in the Partners Program in a manner and to a level determined by the Board. b) Funding for the administration of COR programs will be by assessment on all ratable employers contributing to the accident fund. Funding for financial incentives to employers will be at the classification unit level. c) The Board may reduce, vary, adjust or refund assessments otherwise payable by employers who reduce the overall costs of the Board in implementing the Act by interacting with the Board in a cost effective manner as determined by the Board. d) To ensure the integrity and quality assurance processes of the partners program, Board officers and the Certifying Partners Committee will implement an independent audit process which provides a multi-level risk mitigation strategy at the training, auditor, audit, and certifying partner levels as described in Appendix A - Auditor and Audit Process Quality Assurance. e) The Partners Program will be subject to review and/or audit within three years of the date of this Resolution. DATED at Richmond, British Columbia, May 24, By the Workers' Compensation Board DOUGLAS J. ENNS, CHAIR BOARD OF DIRECTORS

35 APPENDIX C