Construction Employers Coalition Opposes WSIB's Discontinuation of Second Injury Enhancement Fund

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The Construction Employers Coalition (CEC) has expressed strong opposition to the WSIB's decision to eliminate the Second Injury Enhancement Fund (SIEF), arguing it undermines fairness for employers and could lead to increased costs and litigation.

The recent announcement by the Workplace Safety and Insurance Board (WSIB) to terminate the Second Injury Enhancement Fund (SIEF) has sparked significant backlash from the Construction Employers Coalition (CEC) and its legal counsel, compensation lawyer Les Liversidge. During a recent webinar organized by the Residential Construction Council of Ontario, Liversidge raised concerns about whether the supposed administrative efficiencies would justify the considerable disruption this decision will cause. He noted that the elimination of SIEF could potentially free up around 24,000 hours of work, which is roughly equivalent to the workload of 12 employees within the WSIB's expansive workforce of over 5,200. However, Liversidge emphasized that maintaining fairness for Ontario employers is worth the investment in these positions.
The SIEF was established to alleviate financial burdens on employers when a worker's pre-existing disability or medical condition exacerbates a workplace injury or leads to a more severe disability. Originally created in the aftermath of World War II to assist returning veterans, the fund has been a crucial element in reducing discrimination against employers hiring individuals with pre-existing conditions. The WSIB announced the discontinuation of the fund following an audit, effective June 16, but employers were not informed of this significant policy change until a WSIB update was released on July 16.
Having been in operation for 80 years, the SIEF has undergone numerous reviews, yet it has consistently remained intact until this recent decision. In a pointed letter directed to WSIB President and CEO Jeffery Lang and Minister of Labour, Immigration, Training and Skills Development David Piccini, CEC Chair Andrew Pariser urged the WSIB to reconsider its decision and instead engage in comprehensive stakeholder consultations, accompanied by a policy options paper that allows ample opportunity for feedback.
Pariser articulated in his letter that the SIEF serves as an effective insurance mechanism for employers, designed to mitigate the financial risks associated with medical factors that are unrelated to workplace accidents. The coalition represents numerous firms employing tens of thousands of workers and contends that the Ontario workers’ compensation system is inherently unfair to employers in the absence of the SIEF. The CEC pointed out that the WSIB acted unilaterally without prior consultation with employers, which they argue contravenes the principles of transparency and openness that the board is supposed to uphold.
The CEC's letter further highlighted that the SIEF had been a reliable mechanism for encouraging the employment of individuals with disabilities while ensuring that employers are not held liable for costs stemming from pre-existing medical conditions. Liversidge criticized the lack of stakeholder engagement in the decision-making process, stating that the abrupt nature of the WSIB's policy change has raised alarm among employers. He pointed out that claims filed before June 16 would generally not be eligible for SIEF relief unless a request had already been initiated.
Liversidge expressed that many employers feel the WSIB's decision to eliminate the SIEF is fundamentally flawed. He stated, "It is wrong." The CEC argues that without SIEF relief, employers will bear the entire financial burden of claims even when pre-existing conditions play a role in the severity of the injuries, leading to increased premiums for employers whose claims history could now include costs that should have been mitigated by SIEF.
This situation is particularly troubling given that Ontario's rate framework is designed to correlate individual employer premiums with their claims experience. The removal of SIEF relief means that costs that would typically be adjusted could remain on an employer's record. Liversidge foresees that employers facing heightened financial exposure may be more inclined to dispute whether a worker’s ongoing disability is a result of the workplace incident or an underlying medical condition, potentially escalating litigation surrounding claim entitlements.
The CEC's correspondence warns that injured workers may face less stable decisions regarding their entitlement due to the anticipated increase in litigation initiated by employers. The coalition is advocating for a return to a more balanced and fair approach to workers' compensation in Ontario, emphasizing the need for stakeholder consultation before implementing such consequential changes to long-standing programs.

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