Blue Collar scores six-figure cost relief for oilfield services company facing existential WCB crisis
Situation: Edmonton-based employer sought cost relief when faced with a 3X rise in WCB premiums due to a single disability claim. The injured worker in question was a high wage earner who was awarded a lifelong pension (ELP) due to a permanent clinical impairment. Because the associated seven-figure claim costs capitalized all at once, the employer was confronted with a crippling increase in premiums. Moreover, due to the skewing effects of the worker’s lost-time days, the employer was disqualified from serving its most important, long-standing client because of diminished WCB stats.
Response: Blue Collar went to work scrubbing the 2000 page claim file for any grounds warranting cost relief. In the process, the worker was found to have a preexisting health condition and comorbidities that frustrated his recovery, salient facts which had gone completely unnoticed by WCB. The worker was also denied access to treatment and specialists for upwards of a year due to the pandemic, a complication which further impeded the recovery process.
Result: Acting on behalf of the employer, Blue Collar argued for cost relief on the basis of preexisting conditions and the frustration of recovery due to extraordinary circumstances. In the end, our client had over $100,000 worth of claims costs removed from their experience rating, as well as the removal of lost-time days that precluded working for a major oil company. The client was also absolved of all future costs related to the worker’s permanent pension.
The final analysis
An economic loss payment (ELP) is a capitalized cost where the estimated lifetime cost of this benefit is recognized in the year the cost is charged. Therefore, an increase in the number of ELP cases substantially impacts annual claim costs. Between 2017 and 2019 ELP costs increased by approximately $318 million generated by around 1200 additional claims.
Employers are wise to seek the services of an experienced representative whenever a complex WCB claim arises, lest an ELP award precipitate a prohibitive rise in premiums.
