Question.

That concludes the Standing Committee on Agencies, Boards and Commissions' report, Mr. Chairman, but I would like to acknowledge, again, the participation and input from the Arctic College board of governors, the Arctic College departmental officials, staff, and student representatives throughout the review. As well, the committee appreciates all the comments and input from members of the public who appeared as witnesses or provided written submissions. I would also like to thank the Minister for meeting with us over the last two years. I would like to thank committee Members for working together on this report. Mahsi.

Mr. Chairman, we cannot do bills two, three and four because the Minister is not in for these particular bills. I would like to ask for the indulgence of the committee to consider Committee Report 5-12(4), the Standing Committee on Legislation report on Table Document 145-12(3): Legislative Action Paper on the Workers' Compensation Act. Thank you.

Agreed.

---Agreed

Thank you, Mr. Chairman. The Standing Committee on Legislation held public hearings on the Legislative Action Paper on Workers' Compensation Act, from September 29 through October 1, 1993. Based on the submissions received during the public hearings and extensive discussions, the Standing Committee on Legislation was of the opinion that amendments to the current Workers' Compensation Act should be made an immediate priority of this government. Amendments to the Workers' Compensation Act should be introduced to the Legislative Assembly as soon as possible and, if this Bill receives second reading, it would again be referred to the Standing Committee on Legislation for a detailed review.

Summary Of Major Concerns

The meetings held in Yellowknife on the legislative action paper brought forth many strong concerns and considerations for the development of amendments to the Workers' Compensation Act. The major concerns brought forth during the public hearings were:

Office of the Workers' Advisor

The final report of the Standing Committee on Agencies, Boards and Commissions recommended that the office of the workers' advisor be formally established in legislation. The Chief Commissioner, in his report, further recommended that the office be classified as an, out-of-scope position.

During the public hearings on the legislative action paper, the Standing Committee on Legislation heard strong concerns about this position. It was felt that this position should be established in legislation. However, the position should be funded independently from the Workers' Compensation Board and, therefore, would remain independent from the Workers' Compensation Board. It was suggested that the Public Service Act be amended to establish the position in legislation.

Therefore, I move that this committee recommends that the office of the Workers' Advisor remain independent from the Workers' Compensation Board. And further, that the position be funded directly by an alternate government department.

Question.

Mr. Chairman, I thank you for having called the Members back in. However, what I will likely do from here on is probably go through the report and then complete all the recommendations at once. It would make it easier. Mr. Chairman, a second major concern:

Workers' Compensation Board's Annual Report

Some presentations spoke about a shroud of secrecy that surrounds the Workers' Compensation Board. It was felt that information about the Workers' Compensation Board, and access to its services, was difficult to obtain. Many would like to see a more detailed annual report developed and tabled in the Legislative Assembly. Suggestions as to what information should be included in the annual report were:

a) Chair's report: Brief overview of Workers' Compensation Board operations over the last year.

b) The board: Who is on the board. Who nominated them. Length of their terms. Contact numbers.

c) Staff: Names, duties and contact numbers.

d) Workers' Advisor: Summary of position description including a contact number. Statistics on travel and cases dealt with.

e) Review and appeal process: Description of the appeal process. Names of review committee and appeal tribunal. Statistics on number of review and appeals.

f) Accident claims: Number of claims for the year and a breakdown by industry.

g) Details on claims on a part-of-body basis.

h) Assessment revenue collected by Workers' Compensation.

i) Accident fund: dollar amount.

j) Rehabilitation services activity: percentage of clients by province, plus costs to administer.

k) Late reporting: Statistics.

l) Failure to report: Statistics.

m) Administration expenses.

Merit Rebates/Super-Assessments

This program would entail matching the assessments charged to employers to fund the workers' compensation system with their safety record, within each industry.

The legislative action paper states that the authority for this program already exists within the act, so no amendment would be necessary to design this program.

The Chief Commissioner, in his report, stated that, although there will remain a number of policy issues that need to be addressed, this program could be implemented without amendment to the act.

Point of order, Mr. Chairman.

Yes, Mr. Chairman. I am just wondering, since we are presenting the report of the standing committee, and since we do make recommendations in our report, for the record, they should appear as being in the report. When we get to motions in the committee of the whole, we just simply go through each motion at the back of the book. We have six of them. We could go through those six as motions of the committee of the whole. The recommendations that are in the report should be read in anyway. It is just a suggestion, Mr. Chairman.

Thank you, Mr. Chairman. The recommendation, then, after the second major concern was that the Standing Committee on Legislation recommends that the annual report of the Workers' Compensation Board include

more operational details and statistics as listed in this report.

Mr. Chairman, going back to the merit rebates/super-assessments, there was great concern about a merit rebate/super assessment system expressed during the public hearings. Most labour organizations felt this system would bring forth the issue of failure on the part of an employer to report accidents. It was suggested that there are fines already in place in the act for failure to report accidents. It was felt that more severe penalties should be applied to those employers who deliberately avoid reporting accidents to make their record look good and keep their assessment rate low. It was suggested the Workers' Compensation Board consider a penalty assessment system, such as the British Columbia system.

Recommendation 3

The Standing Committee on Legislation recommends that the merit rebate/super assessment program be implemented, however, the act should be amended to increase the fines used as penalties for failure to report accidents.

Board Composition

During the public hearings, it was expressed that the board should be representative of the Northwest Territories. That would mean a requirement to include at least one member of aboriginal descent. A larger board would ensure that at least one person from every part of the territories and the diversity of the occupations was represented. It was also felt that nominations to the board should be scrutinized to ensure appointments were based on qualifications and not patronage. Although the presenters were not suggesting this is the case currently, they felt public scrutiny would prevent nominations from seeming to be based on patronage.

Recommendation 4

Therefore, the Standing Committee on Legislation recommends that the board membership be increased to include at least one member of aboriginal descent and to ensure that the diversity of occupations is represented.

Traditional Harvester/Aboriginal Artists and Carvers

The legislative action paper makes no specific proposal for dealing with the issue of traditional harvesters. However, in July 1993, the Workers' Compensation Board released a proposal paper drafted jointly by the board and the Department of Renewable Resources. The following changes to the existing program were proposed:

- a change to the policy criteria used to define "principally engaged." Rather than using a minimum income level of $10,000, the policy would require that the injured harvester earn at least 25 per cent of his or her yearly income from harvesting. The use of country food by an applicant could be valued to a maximum of $7,000. However, it is not proposed that this definition be added to the act; and,

- an amendment to the act to reduce the amount of compensation provided to traditional harvesters from the YMIR of $47,500 to $24,000. The Workers' Compensation Board stated that this figure was compiled by the Department of Renewable Resources, based on sales records of harvesters for the past several years. Harvesters who earn greater than this amount could apply for optional coverage.

The legislative action paper, similarly, does not address the issue of aboriginal artists and carvers in detail. It notes that the Workers' Compensation Board has the authority under the act to determine an industry or an independent operator to be within the scope of the act; however, it makes no specific proposal regarding the structure of such a program, or compensation levels or eligibility.

There were many varied opinions on these particular issues. Many felt that the board and the department should be commended for their efforts to address the "principally engaged" dilemma. However, a majority of those who made presentations felt that the workers' compensation system was designed to meet the requirements of a wage economy and, more specifically, workers of employers. It was felt that perhaps workers' compensation was not suited to cover independent operators and piece workers.

Recommendation 5

Therefore, the Standing Committee on Legislation recommends that the Minister responsible for the Workers' Compensation further investigate other programs of guaranteed income that may provide coverage for traditional harvesters, artists, carvers and other occupations which my not clearly fit into the workers' compensation scheme.

Management of Pension Fund

It was brought up a number of times during the public hearings that the responsibility of the board of directors, with respect to the management of the fund, is not clearly stated in the legislation. Many were concerned that the legislation did state that the board shall manage the fund, but that it doesn't say that the board of directors is accountable, has a fiduciary obligation to manage these funds in a responsible and knowledgeable manner. Some people feel that this accountability should be in legislation.

Recommendation 6

Therefore, the Standing Committee on Legislation recommends that the Workers' Compensation Act be amended to clearly state the fiduciary obligation of board members for the management of the fund.

Commutation/Lump Sum Payments

Currently, the Workers' Compensation Act allows the board to commute certain permanent disability pensions to lump sum payments. This is possible in cases where impairment of the worker's earning capacity is not greater than 10 per cent, at the discretion of the board. However, the board has adopted a policy that uses the percentage of disability rating, rather than percentage of earning capacity as the 10 per cent guide. This discrepancy between earning impairment and disability impairment has created much confusion.

The legislative action paper proses that the 10 per cent limit on eligibility remain, and that the act be clarified. It also proposes that, within the 10 per cent limit, commutation be available to workers as a right upon application, and where no application is made, the board should have the discretion to commute.

Opinions on commutations varied from strongly opposed to strongly supportive. Most employer groups and organized labour groups did not support a change to the current legislation. Most felt that lump sum payment provisions do not belong in a workers' compensation scheme and that commutations are contrary to the established purpose of workers' compensation legislation. Individuals or employees supported the lump sum provision being available upon application. They felt the current legislation was too paternalistic. They believe that the current legislation takes away the right of the individual to decide.

Recommendation 7

Therefore, the Standing Committee on Legislation recommends that the ten percent disability on eligibility for commutation of pension payments remain in the legislation as currently is, and that the commutation be provided as a right upon application of the worker and that the discretion of the board to commute in the absence of an application from the worker, be eliminated.

I'll ask Mr. Lewis to continue with the report.

During the review of the legislative action paper on the Workers' Compensation Act, the Standing Committee on Legislation did hear other concerns expressed by one or more presenters. We felt these concerns were worth noting, at this time.

Full Funding

Most groups and individuals who made presentations during the public hearings on the legislative action paper felt a full funding requirement in the legislation was a good idea. However, there was some concern that a legislated full funding requirement may have a negative effect on the economy. There was concern that full funding opened the possibility to an increase in assessment rates if the fund should begin to dip out of full funding stats. This increase in assessment rates would raise the cost to do business which in turn would be passed on to the consumer. The presenters felt costs were high enough. For example:

For an employer in building construction sub class that current rate is $10.25 per $100 wages. The class and sub class in the Yukon and Alberta respectively, the rates are $5.50 per $100 wages and $3.00 per $100 wages. The impact to the consumer can be seen when a comparison of an average new house in Fort Smith will cost an additional $7,000, compared to an equal house built just across the border in Alberta.

Safety Education

The Standing Committee on Legislation heard from every group the desire to keep safety and safety education with the Department of Safety and Public Services. Most felt it would be poor public policy to have insurance and policing functions within the same agency.

Review Of The Workers' Compensation Board

During the review of the legislative action paper on Workers' Compensation, the standing committee became aware that the legislative action paper was not clear whether the section regarding review pertained to the scrutiny of the act, the operation of the Workers' Compensation Board, or the entire system.

All presenters during the public hearings did express support for a review of the operations. Most agreed that a legislated review every four or five years was adequate providing the review is conducted by a committee comprised of equal representation of employers and workers with a neutral chair.

Length of Appeal Process

There is a concern about the delay between the time a decision is made that an applicant is eligible for assistance and the time they can appeal the decision. The review process is too long. Many felt that the length of time posed undue financial hardship on behalf of the injured party. It was felt that the process should be streamlined so the amount of hardship is minimal.

WCB Medical Practitioner

As with the position of the workers' advisor, it was felt this position, too, should be independent of the Workers' Compensation Board.

Now, Mr. Chairman, I would like to hand the report back to the Chairman of the Standing Committee on Legislation to move motions in committee of the whole.