November 9, 2020
WorkplaceNL holds discounted average assessment rate at $1.69
St. John’s, NL – Effective January 1, 2021, WorkplaceNL will hold the average assessment rate paid by employers at $1.69 per $100 of payroll, including a temporary $0.21 discount.
The temporary discount is to reduce the surplus in the employer-funded Injury Fund – which was 123.4 per cent funded at December 31, 2019, over its target of 110 per cent. However, the value of the Injury Fund has fluctuated in 2020, primarily due to economic uncertainty created by the worldwide COVID-19 pandemic.
“WorkplaceNL is pleased to be financially able to hold the discounted average assessment rate for employers steady for 2021 during the economic uncertainty created by the COVID-19 public health emergency,” said Dennis Hogan, CEO, WorkplaceNL. “However, rising claims costs, as well as uncertain assessable payroll and volatile investment markets due to the global pandemic, are having an impact on the Injury Fund. If this results in the funded position falling below the 110 per cent target, the temporary discount may be removed within the next few years – earlier than expected.”
Payments for work-related injury or illness have increased in the last five years, from $132 million in 2015 to $157 million in 2019. Payments for 2020 are on track to be higher than 2019.
While the lost-time incidence rate has held at 1.6 per 100 workers for the past five years, more serious injuries, longer claim duration and recent changes to increase benefits are contributing to higher claims costs.
The Maximum Compensable and Assessable Earnings (MCAE) will increase by 1.5 per cent, from $66,980 to $67,985 for 2021 – the highest in Atlantic Canada. This reflects the annual Consumer Price Index adjustment. Wage-loss benefits for injured workers submitting a new claim whose pre-injury earnings are at or above $67,985 will be calculated using this new limit starting January 1, 2021.
Notices of assessment rates for employers will be online by the end of November. Employers who have not yet done so are encouraged to register for a connect (online services) account.
Link to original press release from Workplace NL: Click Here