Compensation Café: Claim Suppression – No More.

Written by: Janet Patterson, WELLS Director

This blog series is meant to cover all things related to Workers’ Compensation. It is managed by one of our WELLS Directors, Janet Patterson.

“Claim suppression” involves any practice which discourages or prevents a worker from filing or pursuing a compensation claim for a work injury. In B.C., the Workers Compensation Act offers no protection to workers who may be disciplined or fired for filing a compensation claim.[1] This is a deep concern for workers injured on the job, especially if they are not in a union or have precarious employment.

In his report, Restoring the Balance: A Worker-Centred Approach, Paul Petrie recommended that WorkSafeBC commission an independent review as “the issue of claim suppression is fraught with allegations that are difficult to document”.[2] To their credit, WorkSafeBC has done this.

Now, Estimates of the Nature and Extent of Claim Suppression in British Columbia’s Workers Compensation System[3], is available, issued by the Institute for Work and Health (IWH) and Prism Economics and Analysis. The complete Report is available on the Institute’s excellent website at the link below. My thanks to Tom McKenna[4] who posted the Report’s highlights on Povnet and brought attention to its important findings.

FINDINGS – CLAIM SUPPRESSION

The IWH Report documents and quantifies findings of claim suppression, resulting from their file review of over 600 claims files. (The Report sets out, in detail, the data, methodology, findings and interpretation.) In brief:

FINDING#1: 53.7% of the sample Underclaimed for Lost Time of 2 or more days

Underclaiming refers to any situation where workers who appear to be entitled to a WorkSafeBC benefit but who chose either not to submit a claim, or having submitted a claim, chose not to proceed with the claim. The reasons for underclaiming are important.

About 40% of workers did not apply due to lack of knowledge
About 21% did not think it worth the trouble or their injury was minor
About 17.5% did not think it worth the trouble, given they had a sick leave plan
About 12% thought they would get in trouble with their employer or were pressured not to apply
About 3% were encouraged by fellow employees not to apply for fear of losing a bonus
About 21.5% did not apply for other reasons

In summary, the leading cause of underclaiming was lack of knowledge (40%) or feeling that it was not worth it for some reason (35.9%). Perceived pressure to not make a claim was about 14.3%.

FINDING #2: 4-12 % of Claims were Misrepresented as “No Time Loss” Claims

Misrepresentation refers to claims which are submitted and classified by WorkSafeBC as “no time-loss” claims, notwithstanding that the injuries or diseases involve lost working time. The Report estimates that between 4-12% of claims were misclassified by WorkSafeBC as “no time loss” claims when the evidence suggested there was time loss.

FINDING#3: 12-18% of Rejected or Abandoned “Time Loss” claims were Problematic

The Report estimates that about 21.8% of rejected, suspended or abandoned claims likely pertained to compensable time loss injuries. Of these, between 12-18.6% were considered “problematic”, in that there was evidence to suggest a compensable work injury or disease. The Report estimates that for about 2.3 – 8.3% of this sample, there was a risk of claim suppression.

FINDING #4: 3.7-13% showed evidence of Claim Suppression

Claim Suppression involves any overt or subtle actions by an employer or its agent which have the purpose of discouraging a worker from reporting a work-related injury or disease. The Report, using different indicators of claim suppression, estimates a range from 3.7% to 13% over the whole sample. The different indicators are necessary because an analysis of claim suppression can be complex. For example, 13% of the workers reported that their employer asked them not to report time loss and/or threatened them with repercussions if they did so. However, it is not clear whether these threats actually deterred workers from making a claim or to what extent the threats were sanctioned by management.

AND THE TAKE-AWAYS?

THERE ARE UNNESESSARY BARRIERS TO COMPENSATION:

Over 40% of workers with injuries (time loss of 2 days or more) either didn’t know they were entitled to compensation benefits or did not know how to apply for them. As the Report notes, “Underclaiming is more common among those who immigrated to Canada, workers with lower educational attainment, workers who are not union members, employees of small employers, and those who work on a temporary basis (directly or through temp agencies.)

These barriers are not unknown, only unaddressed. In the past, many recommendations have been made to pierce these access barriers. In the New Directions report alone, it is recommended that a simple information package for workers and employers be developed, in several languages (Recommendation #42) with special accessible resources for farm workers (Recommendation #41) and Indigenous communities (Recommendation #99). Perhaps now that there is a quantification of this issue, progress can begin and WorkSafeBC can remove these barriers, in keeping with improvements made in other public bodies.

THE SYSTEMIC MISREPRESENTATION OF “NO TIME LOSS” CLAIMS IS SERIOUS

It is disturbing that an independent review estimates that WorkSafeBC likely misclassifies “time loss” claims (2 days or more) as “no time loss” in 4.1-12.1 % cases. The misclassification results in a misrepresentation of the nature and frequency of serious injuries.

Equally disturbing is the information in the employer survey. Almost 27% of employers reported their belief that, in their industry, time loss injuries are reported as no time loss injures “all of the time or almost all of the time”.

This misrepresentation is likely the result of WorkSafeBC’s Case Management System (CMS) which systemically classifies injuries, even serious injuries, as “no time loss” claims when an employer offers the injured worker “light duties” on the same day as the injury. In such cases, the injury is coded in CMS as “HCO” or “Health Care only”, meaning “no time loss” benefits. Unless there are follow up events, the injury remains coded as a “no time loss” claim, even if it is a serious injury. This misclassification can have serious consequences for the injured worker, even while benefiting the employer’s experience rating.

The New Directions recommendation #51 addressed this and other issues in the “light duty” area. However, the extent of this misrepresentation is now documented and flagged as type of claim suppression. Clearly, this practice must be revised if time loss claims are to be fairly and accurately understood and the fix is easy – a specific change to both CMS coding and reporting practices around “light duties”.

CLAIM SUPPRESSION EXISTS – LEGISLATIVE CHANGE IS NEEDED

Among all cases, 13% of the sample reported that their employer asked them not to report time loss and/or threated them with repercussions if they did so.[5] About 6% of employers reported in their survey, that in their industry, time loss claims were “rarely or never” reported to WorkSafeBC.

Clearly, the Act should be amended to protect workers’ right to make a compensation claim and that interference with that right is a discriminatory act, whether before or during a compensation claim. This specific recommendation was made both by WCAT and by the New Directions report (#43).

Bonus Systems as a form of claim suppression

An equally big take-away is the finding that bonus systems in the workplace play in claim suppression. Bonus plans will reward a group of workers for being accident-free but may directly or indirectly incentivize workers to discourage fellow employees from reporting injuries or submitting claims. About 11% of employers reported providing such a plan. For example, one employer installed a large TV in the lunchroom and said it would be removed when the first compensation claim was filed.

The toxic dynamic of claims suppression, including bonus system issues, was presented in a public submission to the Review by the Boilermakers. Below is a partial excerpt from their submission, with workers’ names redacted.

Boilermakers must continually train for safety in the workplace due to the possibility of exposure to hazardous materials, gases, and other safety factors….The Lodge’s primary concern is that many employers coerce employees not to file claims when injured. This coercion can be direct through personal appeal, promises, favourable treatment, or threat. ….

In the case of “Y”, he suffered an overuse injury from fabricating…When he reported the incident to his employer, he was apologized to and advised that the employer would take care of him. However, when he filed a claim, the employer immediately protested on the basis that he injured himself playing sports. The frivolous protest resulted in a prolonged appeal that also meant that Y was both personally and financially impacted.

…it is not uncommon for our members to be advised that if a worksite goes a certain period of time without a reported claim that all members would be entitled to a bonus of some kind.

Their submission also noted that the “experience rating” system has created a “perverse incentive” where efforts are focused on reducing the reporting of claims, rather than reducing injuries. This may be at the root of the claim suppression problem.

CONCLUSION

The IHW report on claim suppression in B.C. compares its findings with other reports in other jurisdictions, including those from Manitoba (2013) and Ontario (2013) and concludes:

…the studies concur on the importance and approximate magnitude of under-claiming, the risk of misrepresenting lost working time incidents as incidents that entailed no lost working time and the existence of claim suppression conduct on the part of employers.

Clearly, there are practices which suppress claims and even potential rewards for such practices. For a compensation system to have basic integrity, workers must have both the right and the means to make a compensation claim and clear protection for doing so.

For WorkSafeBC, this means doing better education outreach and making special efforts made to reach underserved populations. It also means revising its classification processes so as not hide “time loss” claims and ending any employer benefit from misrepresentation.

For the government, it is simple. Amend the Act to protect workers from claim suppression.

https://www.iwh.on.ca/sites/iwh/files/iwh/reports/iwh_report_claim_suppression_bc_dec_2020.pdf

https://www.iwh.on.ca/archive/iwhnews/iwhnews_2021_06.html

[1] Sometimes, this gap is a shock, given that the Act protects workers against retaliation for exercising safety rights in the workplace. In 2015, a WCAT vice-chair thought that the gap likely was the result of “an error or oversight in legislative drafting” and recommended that the Act be amended. (WCAT 2015-03765)

[2] Paul Petrie, Restoring the Balance: A Worker-Centred Approach. page 34, Recommendation 21

[3] The full IWH Report is 137 pages long. It has a helpful Executive Summary, with short summaries also available in an IWH Issue Briefing document and in the June 2021 newsletter, all available on the IWH website.

[4] Tom McKenna is the National Representative Health and Safety and WCB Advocacy, for the Canadian Union of Public Employees (CUPE).

[5] Issue Briefing, May 2021, page 6.

Originally published September 30, 2021