CANADA British Columbia to Inquire into 2008 Farm Worker Deaths

The British Columbia  Federation of Labour (BCFL) is calling for a full public inquiry and coroner’s inquest into a deadly workplace accident in 2008 that claimed the lives of three farm workers and injured three others a year ago at a local mushroom facility.

The accident happen  to a group of workers attempting to repair an electric motor powered a pump system in a confined area of the farm when a flange from the system became disconnected. Some workers were overcome by toxic gas in the oxygen-deficient pump house as workers who tried to come to their aid.

“I’m hoping  there’s a full investigation, not just what chemicals killed them and why they died, but a full investigation of how they got there in the first place,” BCFL president Jim Sinclair said. “Three people died in a place they shouldn’t have been – in close containment.”

Sinclair said  two of the three surviving workers were “seriously, seriously injured” in the incident. Family members of the deceased and injured workers were on hand for the press conference, and one of the severely injured workers was also present. “[He] was taken to intensive care as we were having the press conference because he stopped breathing,” Sinclair said. “He’s still not really conscious,” Sinclair noted, adding that even before the recent episode, the worker suffered brain damage and could not hear or talk.

The investigation  into the accident is ongoing, including the identity of the toxic gas in question, according to WorkSafeBC spokeswoman Donna Freeman. (It was initially believed to be hydrogen sulphide.) The BCFL has questioned the length of time of the investigation, saying family members of the workers are anxious for answers.  (workersxzcompxzkit)

“A full year  after the incident, the Workers’ Compensation Board has still not completed its investigation, a coroner’s inquest has not been called, and no charges have been laid,” the BCFL added in a statement.  Freeman says the investigation is complicated, noting that 25 investigators have worked on the case over the course of the investigation. Furthermore, hazardous waste remained at the accident site for six or seven months afterwards, Freeman noted, due to complexities in removing it safely for workers and disposal/transportation issues.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

We are accepting short articles* (200-600 words) on WC cost containment. Contact us at: Info@WorkersCompKit.com. *Non-compensable.

Posted in Canada Workers Comp, Litigation Management, Medical Issues |

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CALIFORNIA Insurance Agent and Agency Liable for WC Coverage Failure

How Would You Decide? 

Here’s what Tom Robinson, J.D., writer for Lexis Nexis Workers Comp Law Center reports on a rare victory for the insured about lack of workers’ compensation coverage.

Here’s What Happened
Plaintiffs opened  a new dealership, Rhino Linings of Santa Fe Springs, selling and installing spray-on linings onto the beds of pickup trucks and other vehicles.  When plaintiffs inquired about insurance needs, Rhino USA, the company selling the dealerships, referred them to Robyn Thaw, an experienced insurance agent in California, who had handled the insurance programs for a number of the Rhino dealerships. 

Plaintiffs indicated  Thaw told the plaintiffs she was, indeed, knowledgeable about the specific needs of the new Rhino dealership and she had put together a specialized insurance program specifically designed for their business.  Thaw had attended informational seminars for new dealers given by Rhino and at those meetings spoke to the groups about insurance needs and various insurance products tailored for Rhino dealerships. 

When plaintiffs  suggested they meet with Thaw to discuss their needs, they said Thaw indicated a meeting would not be necessary, and she would forward to them the necessary applications.  Evidence suggested the plaintiffs filled out some portions of the forms but left the insurance portions of the forms blank, to be filed in later by Thaw.  Various policies of insurance were subsequently delivered by Thaw to the plaintiffs. 

Still later,  an employee working for plaintiffs was severely injured in a fire at the dealership premises.  It was then determined no workers’ compensation insurance had been procured.  The injured worker sued plaintiffs and others, including Rhino USA, and obtained a verdict exceeding $11 million. 

Plaintiffs then sued  Thaw and her insurance agency, contending in pertinent part Thaw had negligently failed to secure necessary workers’ compensation coverage.  Following a bench trial, the trial court found Thaw and the agency liable for negligently procuring insurance and the defendants appealed.

How the Court Ruled
In Williams v. Hilb, Rogal & Hobbs Ins. Servs.,  2009 Cal. App. LEXIS 1496 (Sept. 9, 2009), the Court of Appeal of California (Second Appellate District, Division Eight), affirmed the entry of the judgment against the defendants.  Initially, the appellate court acknowledged that generally an insurance agent does not have a duty to volunteer to an insured that the insured should procure additional or different insurance coverage.  According to the court, ordinarily the insurance agent’s duty is to use reasonable care, diligence, and judgment in procuring the insurance requested by an insured.

The court noted,  however, the rule changes when any of the following factors was present: (a) the agent misrepresented the nature, extent or scope of the coverage being offered or provided; (b) there was a request or inquiry by the insured for a particular type or extent of coverage; or (c) the agent assumed an additional duty by either express agreement or by holding himself or herself out as having expertise in a given field of insurance being sought by the insured. The court continued that an agent assumes additional duties by holding herself out as having expertise in the insurance being sought by the insured and  may be liable to the insured for losses which resulted as a breach of that special duty.  (workersxzcompxzkit)

While the court  acknowledged that ordinarily an insured has a duty to read and understand the policy of insurance, the court added that the language of the policy might not control because of an insurer’s conduct extrinsic to the contract.  Moreover, an insured’s failure to read the policy did not always render the insured’s reliance on the agent’s advice unjustifiable as a matter of law.  The court concluded that the evidence amply supported the court’s finding that Thaw failed to use the skill and care a reasonably careful insurance professional would have used in similar circumstances and that Thaw had held herself out as an expert.  There was no error.

See generally  Larson’s Workers’ Compensation Law, § 150.02, 152.02, 152.05.

Tom Robinson, J.D. is the primary upkeep writer for Larson’s Workers’ Compensation Law (LexisNexis) and Larson’s Workers’ Compensation, Desk Edition (LexisNexis). He is a contributing writer for California Compensation Cases (LexisNexis) and Benefits Review Board – Longshore Reporter(LexisNexis), and is a contributing author to New York Workers’ Compensation Handbook(LexisNexis). Robinson is an authority in the area of workers’ compensation and we are happy to have him as a Guest Contributor to Workers’ Comp Kit Blog. Tom can be reached at: compwriter@gmail.com.
http://law.lexisnexis.com/practiceareas/Workers-Compensation

TD Calculator:www.ReduceYourWorkersComp.com/transitional-duty-cost-calculator.php
WC 101: www.ReduceYourWorkersComp.com/workers_comp.php

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker about workers’ comp issues.

©2008 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@WorkersCompKit.com

Posted in Broker Issues & Relationships, Insurance Issues, Rates, Premiums, Litigation Management |

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CANADA Saskatchewan Employer Fined $32,000 for Injuries to Workers

In addition to Workers Comp, Other Factors Related to Employee Issues Can Raise Company Costs

Even when workplace injuries or discrimination acts are not directly connected to workers’ compensation, they still may cost the employer additional expenses in fines and orders to provide more training in workplace safety.

Saskatchewan Employer Fined $32,000 for Injuries to Workers

An alleged pair  of separate incidents leading to serious injuries to workers results in a $32,000 fine for Saskatchewan food company.

The company  was charged after a 26-year-old worker fell from the top of a piece of equipment at its Saskatoon plant in 2007 and subsequently pled guilty to six charges under the province’s Occupational Health and Safety regulations.

In a separate case,  charges were handed down when a 27-year-old worker was injured by an exposed auger in January of this year.

According to government  officials, the charges stem to the alleged lack of supervision for the workers and unsafe conditions around the machinery and equipment that were responsible for the injuries.

Business Fined More than $115,000 for Alleged Discrimination

A large mall retailer  was fined $115,264 for alleged discrimination, after employees at the Mall of America store in Minnesota reportedly refused to allow a family member to accompany an autistic girl into the fitting room to try on clothes according to a report from Minnesota Public Radio.

The judge decided  the girl suffered mental anguish as a result of the incident while shopping with her 17-year-old sister for school clothes when a store employee refused to allow the sister to accompany the young girl into the fitting room.  The employee said corporate policy only allowed one person at a time into fittings rooms to reduce the possibility of theft. The clerk stilled refused even when told of the teenager’s autistic disability and that she could not be left alone.   

The mother,  after being called to the store by the older sister said she did not receive any assistance from the employee on the scene, a customer service rep and an assistant manager. Neither did she receive assistance following two letters to the retailer and several phone calls, before reporting the incident to the Minnesota Department of Human Rights.

An administrative law  judge found the retailer discriminated against the 14-year-old girl, in violation of state statutes. The judge ordered the fine after the retailer repeatedly refused to respond to the daughter’s mother’s request for an apology and denied engaging in discriminatory practices.

The company was  ordered to pay compensation of $25,000 for mental anguish; cover $41,069 in attorney fees; pay a $25,000 fine; and other expenses of $24,194 – a total of $115,263.00.

In addition,  the company must display signs in close proximity to the fitting rooms in all Minnesota stores stating the fitting room policy, and explaining disabled customers can seek an exception. (workersxzcompxzkit)

The company  was ordered to provide more disability training to employees, and review and revise its policies in relation to customers with disabilities.

The corporation has appealed claiming the fines are excessive.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

TD Calculator:
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Return to Work in Unionized Companies
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Posted in ADA (Americans with Disabilities Act), Insurance Issues, Rates, Premiums, Integrated Disability Management, Management Commitment, WC in Other Countries (International) |

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Insurance Company Ordered to Pay 4.5 Million in EEOC Case

Note: Workers’ Compenstion Insurance is a type of “property and casualty” business insurance required in all states, except Texas where an employer may opt out. It is referred to as a “line” of insurance coverage and is purchased from an insurance agent or broker.

Major Insurance Company Ordered to Pay $4.5 Million in Age Bias Suit

The U.S. Equal  Employment Opportunity Commission (EEOC) announced a major settlement of an age discrimination class lawsuit against a major insurance company for $4,500,000 to be paid to approximately 90 older former employees, in addition to significant remedial relief.

“Discrimination against  older workers is counterproductive and wrong, and the EEOC has been taking a close look at ways to increase our law enforcement efforts in this area,” said EEOC Acting Chairman Stuart Ishimaru. “Corporate America must be more vigilant in guarding against job bias affecting older workers, or risk action by the EEOC. This settlement shows there is a high price to pay for discriminatory employment policies and practices that adversely impact older workers.”

In its lawsuit,  filed in October 2004 under the Age Discrimination in Employment Act (ADEA), the EEOC charged in 2000 the company adopted a hiring moratorium for a period of one year, or while severance benefits were being received, that applied to all its employee-sales agents who were part of Allstate’s reorganization from employee agents to what the company considered independent contractors.

The EEOC  alleged the policy had a disproportionate impact on the company’s employees over the age of 40 because more than 90% of the agents subjected to the hiring moratorium were 40 years of age or older. The employer denies its hiring moratorium violated the ADEA.

In 2005,  the U.S. Supreme Court held in Smith v. City of Jackson that a facially neutral policy, such as the one used by the insurance company’s hiring moratorium, which disproportionately affected those age 40 and over violated the ADEA unless the policy was based on a reasonable factor other than age.

As provided  in the Stipulated Order resolving the litigation, pending approval by U.S. District Judge E. Richard Webber in U.S. District Court for the Eastern District of Missouri (Civil Action No. 4:04CV01359 ERW), the employer will pay former employees who sought employment — or would have sought employment with the company in the absence of its policy — a total of $4.5 million to be divided among the class via a settlement fund.

The order, effective for three years, also provides for discrimination prevention training, posting of notices, reporting and monitoring, and other relief designed to educate all company managers in order to prevent future violations of the ADEA.  (workersxzcompxzkit)

In 2007,  the parties settled claims of disparate treatment which were asserted for two individuals. Those claims were settled for $250,000 and are not covered by the 2005 settlement.

In July, the Commission held a public hearing on age discrimination and barriers to the employment of older workers. Additional information about the hearing can be found on the EEOC’s Web site at http://www.eeoc.gov/abouteeoc/meetings/7-15-09/index.html

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

We are accepting short articles* (300-600 words) on WC cost containment. Contact us at: Info@WorkersCompKit.com. *Non-compensable.

Posted in EEOC Discrimination Laws, Litigation Management |

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AUSTRALIA Workers Comp Work Related Injuries Survey Released

Safe Work Australia  recently announced the release of four reports based on an analysis of the 2005-06 Work Related Injuries Survey (WRIS). The WRIS is conducted every five years by the Australian Bureau of Statistics (ABS) as a supplement to the Labour Force Survey. Safe Work Australia partially funds the survey in order to complement its collection of workers' compensation data. The analysis  presented in the reports concentrated on groups of people who are either not covered by workers' comp or who are not separately identified in the workers' comp data. The reports includes: 1.  Comparison  of compensation data with all incurred work-related injuries. 2.  The impact  of shift work on work-related injuries. 3.  The impact  of employment conditions on work-related injuries. 4.  Factors  affecting applications for workers' comp. Some of the key findings in the reports include: 1.  Workers' comp  data only captures 60% of work-related injuries but it provides a good picture of the industries and occupations with the highest incidence rates, the way in which injuries occur and the types of injury. 2.  In most  occupations and industries, self-employed workers recorded lower injury rates than employees. 3.  Part-time  workers recorded twice the injury rate per hour worked of full-time workers. 4.  Shift workers  had twice the injury rate per hour worked of non-shift workers. 5.  Female  employees were less likely to apply for workers' comp than male employees. 6.  Only 44%  of employees without leave entitlements (casual workers) applied for workers' comp for injuries requiring some time off work compared to 57% of employees with leave entitlements. (workersxzcompxzkit) 7.  Young  workers aged 15 to 24 incurred much higher rates of injury than other age groups and were the least likely to apply for workers' comp.  See WCK:  http://blog.reduceyourworkerscomp.com/?p=435 The next WRIS  covering the period 2009-10 is currently being conducted and Safe Work Australia will publish the findings in 2011. See http://www.safeworkaustralia.gov.au/  for full reports. 

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

We are accepting short articles* (200-600 words) on WC cost containment. Contact us at: Info@WorkersCompKit.com. *Non-compensable.

Posted in Litigation Management, Medical Issues, Safety and Loss Control, WC in Other Countries (International) |

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Scoring Your Workers Comp Management Practices What Is the Goal

What Is the Goal?
Successful work comp  administrators know the GOAL is to reduce costs of the company’s workers’ compensation program while still taking good care of workers injured in the workplace. The rationale for this is that the financial impact of workers’ comp can be financially devastating for a company. If your company has a large deductible all the losses are within your deductible which means that your company pays directly. If you are in a guaranteed cost program, your experience rating will decline and premiums will increase as your experience “mod” goes up. And, in some cases, if your mod is over 1. you won’t even be able to bid on business in some industries, in some states.  Using a metric that measures operational practices is crucial. One such metric is the National Workers’ Compensation Management Score (NWCMS). For the first time, the 2009 RIMS Benchmark Survey measures operational best practices offering a look at which best practices companies use most and least. This is a noteworthy development.  

  If your company  has this workers’ comp score, you can stop reading!  You’ve reached your perfect goal.

However,  if your company is like most, you will not score a perfect 100+.
More likely your score will look something like this:
                                                                                       

So, WHAT does it all mean?

After answering  88 questions, you’ll receive a measure of where your company stands in reducing with its workers’ comp program costs and receive recommendations for improvement.  That’s it – 88 questions covering 10 key work comp areas.

You will discover  you are doing better in some areas and poorly in others.  The List of Score Rankings tells you where you stand.  The Assessment results tell you what you have to do to IMPROVE!  And, with improvement comes a higher Workers’ Comp Score.

As we like to say,  ”If you don’t know what you don’t know.” then you are going nowhere except your COSTS will be going up, up, up!  Since workers’ comp costs are not part of the stock market, they need to go down, down, down.

List of Score Rankings

Score 1-28 Welcome aboard!  Your score indicates you are just getting started and are new to workers’ comp cost containment.  Don’t be discouraged or try to “fix” everything at once.  Go step by step.  You may put 1-4 Recommendations on your “to do” Timetable.

Score 29-60 Let’s get started!  Your workers’ comp cost containment program is started and you are ready to build by implementing some new procedures and practices.  Prioritized the 4-7 recommendations on your Timetable.

Score 61-82 Push a little harder!  You are in pretty good shape!  But, now is not the time to let down.  Fine-tune your program to build a solid, effective program.  Prioritize the recommendations and put as many as you think you can handle on the Timetable.

Score 83-100+ Great Job! Your company has an excellent program and may only need a little tweak here and there to make it a Best-In-Class.  Because you have so few recommendations, put them ALL on your Timetable and start “tweaking.”

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

Posted in Assessment & Diagnostics, Benchmarking & FTE & Operational Comparison, Workers Comp Kit |

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CALIFORNIA Statistics on How Pharmaceuticals Affect Workers Comp Cost

Here is a synopsis  of “Changes in Pharmaceutical Utilization and Reimbursement in the California Workers’ Compensation System,” available at http://www.cwci.org/

Rising RX & Payment Costs Statistically – Part 1

1.  The average  number of prescriptions and total pharmaceutical payments per claim in California workers’ compensation are up sharply since 2002, despite medical reforms and the adoption of a pharmacy fee schedule.
2.  Average  number of prescriptions (RX) and pharmaceutical payments per claim (PPC)rose from 3.5 in 2002 to 5.0 in 2007, a 52% increase in 6 years.
3.  The cost  of first-year prescription payments (PP) rose from $269.05 to $461.90 an increase of 72%, a rise only partially due to increased number of RXs per claim  (workersxzcompxzkit)
4.   The average  payment for generics declined in the same 6-year period, while “brand” meds rose by 56%.
5.   The study  claims growth in total RX cost to both increased utilization and a shift to “brand” medications.
6.   In years  2005-2007, the average number of first-year RXs per claim rose 25% and first-years PPC rose 35.6%

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

Posted in California Workers Comp, Medical Issues |

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CALIFORNIA How Pharmaceuticals Affect Workers Comp Cost Reform and Rising Costs

Final Part of a synopsis  of “Changes in Pharmaceutical Utilization and Reimbursement in the California Workers’ Compensation System,” available at http://www.cwci.org/

Regulatory Reform and Rising Costs

The Institute  also took a look at the effectiveness of regulatory reforms enacted in 2007 to close a loophole allowing medical providers dispensing repackaged drugs from their offices to obtain much higher payments than pharmacies for dispensing the same drugs.

In 2006 data  showed (just prior to closing the loophole) repackaged drugs represented well over half (54.7%) of all filled prescriptions and 59.2% of all prescription payments in California workers’ comp.

By the mid-2007,  repackaged drugs declined to 10.5% of RXs and 8.3% of the payments, and these percentages continue to decline, with data for the first three quarters of 2008 showing repackaged drugs accounting for just 8.1% of workers’ comp prescriptions and 5.8% of the pharmaceutical payments.

The Institute study  shows even though reforms such as modified fee schedules and non-differential pricings for repackaged drugs can successfully curbed some of the excesses in California workers’ comp, prescription drugs remain a key cost driver as the fluid nature of pharmaceutical pricing, new drugs, limited generic substitution, direct-to-consumer advertising, and lack of formulary controls limit the system’s ability to better control utilization and cost increases from year to year. (workersxzcompxzkit)

In addition,  the recent addition of a Pain Management treatment guideline to the Medical Treatment Utilization Schedule (MTUS) raises questions about the future use of pain medications and ancillary services. The Institute plans  to conduct follow-up research next year which to measure the association between pain management protocols, changes in pharmaceuticals, the use of opioids and claim outcomes.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

We are accepting short articles* (200-600 words) on WC cost containment. Contact us at: Info@WorkersCompKit.com. *Non-compensable.

Posted in California Workers Comp, Medical Issues |

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CALIFORNIA How Pharmaceuticals Affect Workers Comp Cost

Continuation of a synopsis  of “Changes in Pharmaceutical Utilization and Reimbursement in the California Workers’ Compensation System,” available at http://www.cwci.org/

The Role of “Schedule II” Drugs in Rising Costs

The study  identified a steady increase in the use of “Schedule II” medications – including oxycodone, fentanyl, morphine and short-acting barbiturates used to treat injured workers.  These federally controlled substances, while having legitimate medical uses, also have a high potential for abuse or addiction.

The Institute’s data found the use of these drugs in:

1.  2002:   nearly  tripled  from 0.4% to 1.1% of the 2004 prescriptions
2.  2005:   fell back to 0.9%
3.  2006:   took a sharp jump 1.3%
4.  2007:   doubled to 2.9%
5.  2008:   doubled  again  to 5.9% by the third quarter
6.  While usage of Schedule II meds rose, the average amount paid rose also, tripling from $97.73 in 2002 to $279.75 in 2008.   (workersxzcompxzkit)
7.   With the rise  of usage and reimbursement, Schedule II drug payments skyrocketed from 0.7% of California workers’ comp prescription dollars in 2002 to 18% of prescription payments in the first three quarters of 2008.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

Posted in California Workers Comp, Medical Issues |

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Workers Comp Policy Differences in Canada and the US

RIMS: Canada and United States Have Different Employer Practice Liability Needs from Commercial Policies

The Canadian  commercial marketplace requires standard policy wording for Employer Practice Liability (EPL) policies very different from U.S. policies, according to the Canadian Underwriter and discussed by experts  taking part in a panel discussion at the RIMS Canada Conference in St. John’s, Newfoundland.

The Risk Management  Counsel of Canada presented a seminar, ‘Employer’s Dream: Insurer’s Nightmare! Employer’s Liability: The Need for a Canadian Model,’ at the conference.

Panel participants  noted EPL policies differ from Commercial General Liability (CGL) policies and Director & Officer (D&O) Liability policies, since EPL policy cover “intentional incidents”  such as harassment of one employee by another.

Elizabeth Forster, panel member and a partner at Toronto’s Blaney McMurtry, noted there is a breadth of issues relating to EPL policies. These include the fact “there are a huge number of different areas of liability an employer faces and, secondly, we [Canadians] don’t have consistent policy language.”  Panel member Jorge Segovia, a partner at Cox and Palmer in St. John’s, pointed out a pair of main differences between Canada and the United States showcasing the need for Canadian insurers to approach EPL coverage in a distinct manner.

First is the definition  of wrongful dismissal in Canada and in the United States, according to Segovia.  In the United States, a wrongful dismissal claim can take place if the termination involves some form of statutory breach such as discrimination.

In Canada, ”wrongful dismissal is simply the fact a terminated employee has not been given reasonable notice or pay in lieu of notice, because our [employment] contracts, if it’s not built in, have an implied term requiring the reasonable notice or termination or payment in lieu of notice,” Segovia commented.  According to Segovia, “most Canadian EPL insurers will likely try to remove that coverage.”  (workersxzcompxzkit)

Segovia said  the other distinction has to do with punitive damages. “A lot of EPL claims involve claims for punitive damages. In the U.S., punitive damages are not covered by EPL policies because the size of the damages being awarded in the U.S. is quite high.”  In Canada,, where the awards are quite modest, most insurers agree to cover the damage awards.  Segovia noted that “It certainly would be useful over time to develop standard wording and clauses such as what we have for our CGL policies.”

Author Robert Elliott,executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-786-8286.

We are accepting articles, tips and hints* (300-600 words) on WC cost containment. Contact us at: Info@WorkersCompKit.com. *Non-compensable but we will post your link.

Posted in Canada Workers Comp, Insurance Issues, Rates, Premiums, WC in Other Countries (International) |

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