WorkSafeNB started 2019 on a high note as the government, with the broad support of all parties, passed an important piece of legislation on December 20, 2018. This legislation introduced a long-overdue benefit for injured workers with the gradual elimination of the unpaid three day wait. It also resolved two key issues that had been driving workers’ compensation claims costs significantly higher for the previous four years. It clarified that only our board held the authority for creating policies and that workers’ compensation is only payable for injuries arising out of and in the course of employment. Concurrently, our board immediately announced that the average assessment rate for 2019 of $2.92 per $100 of payroll was being reduced to $2.65.
During 2019, an additional three pieces of legislation were passed by the government, further addressing recommendations of the Task Force on WorkSafeNB, the recommendations of the Auditor General, and recommendations from WorkSafeNB following consultation with stakeholders. Of note, these bills focused on improving areas of governance, improving workplace health and safety by clarifying the duties of supervisors, and embedding the duty-to-accommodate requirement in the Workers’ Compensation Act. Together, these legislative changes, combined with our Strategic Plan pillars, form the backbone upon which we build our future.
It’s not by accident that our first strategic pillar is to “Drive a safety-first culture.” In 2019, we created a team whose sole focus is to work with employers, employees and other stakeholders to raise awareness on the importance of safety leadership and safety culture. We observed a high level of interest in workplace safety by all stakeholders as we emphasized the duties and responsibilities of employers, supervisors and employees under the Occupational Health and Safety Act. Therefore, I’m delighted to report that our 2019 lost-time injury frequency is at its lowest level of the past 10 years. We also recorded a 50% reduction in total fatalities to 14, as well as a sharp decrease in acute workplace fatalities, dropping to eight compared to 13 the previous year. But 14 workplace fatalities is 14 too many, regardless of the cause. Every one of them was preventable. A single year showing improvement does not represent a trend, and we are fully committed to driving improvements until we reach zero.
Our claims management and rehabilitation team experienced some of the most significant changes in 2019. This team had been working on a geographic basis for many years but was now operating by function. We designed this change to improve consistency in our processes and improve service levels for our clients. At the same time, we were on-boarding additional talent required on the executive team within Finance and Information Technology to start our transformation journey.
Before long, it became clear that we would have to make significant changes to our initial transformation plan. Our claims management and rehabilitation division, which required the most investment, was not able to move as quickly as initially planned on a new claims management system. Instead, we would have to invest in a new financial system first and then integrate a new claims management system. It also meant delaying the timing of some of the targets for improvements stemming from the recent Auditor General’s recommendations.
Systems issues aside, we remained focused on process improvements and implementing the new legislation. By doing so, we achieved substantial improvement in several key areas. Once our transformation investment is complete, we have a longer-term goal to provide easy 24-hour access to the information for our clients. In the meantime, when clients do call, we strive to provide full, accurate information during the first call. I was thrilled that our enquiries team took this on as a challenge this year and achieved a 72% first-call resolution rate, which is more than twice the level achieved in 2017.
Our focus on safe early return to work also resulted in improvement over the previous year. Compared to 2018, we saw 6% more workers return to work within 26 weeks and 2% more return to work after two years. A safe return to work is a healthy part of rehabilitation and, though we still have work to do, we are now in the “middle of the pack” when compared to other provinces.
One area where we failed to improve in 2019, and actually got worse, was in our time-to-first cheque. This is a critical metric as continuity of income is essential for all injured workers. These delays are unacceptable, and we are investing a great deal of effort in 2020 to rapidly turn this around.
On the financial front, we saw the cost curve flatten and start to decline in the first six months of 2019. Though the amount of decline was nominal, the fact that three years of continuous cost increases were shifting to cost reductions was substantial. This shift allowed our board to announce an average 9.4% reduction in assessment rates for 2020. Through the balance of the year, we observed continued cost reductions and a strong stock market. Claims costs for assessed employers finished the year $10 million lower than 2018, future liabilities fell by $71 million, and investment income exceeded $184 million. The year-over-year change in net income was $580 million. In all, our funding level improved by 30%, ending the year at 105%. These positive trends will bode well for costs into 2020.
As I write this message, I am approaching the halfway point of my term as president and CEO. I’m very proud of my team and what they have accomplished so far, though we know that we still have much to do. We are a couple of months into the COVID-19 pandemic and most of the WorkSafeNB team has transitioned to working from home. What we initially thought would be a very challenging change, has instead brought forth opportunity and innovation. We think differently. We look at challenges differently. We consider better ways to serve our clients as they face similar challenges. I find myself now looking forward to the next two and a half years with even more optimism, thinking about how much more we can accomplish than we had planned. I can’t wait for all of you to join me on the journey.
Douglas Jones