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Royal Commission on Workers' Compensation

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					Volume I
Chapter 1




Introduction
Contents
 A Brief History of Workers’ Compensation in BC ...................................... 7

     The Workplace in the Nineteenth Century ............................................... 7
     State Initiatives To Protect Workers ......................................................... 7
     The Historic Compromise....................................................................... 11
     Growing Pains ......................................................................................... 13
     Royal Commission on the Workmen’s Compensation
      Board (1941 to 1942) ............................................................................ 14
     Royal Commission Relating to The Workmen’s Compensation
      Act and Board (1949 to 1952) .............................................................. 15
     The Board Under Fire .............................................................................. 17
     Commission of Inquiry, Workmen’s Compensation Act
      (1962 to 1965) ....................................................................................... 18
     Politicizing the Board .............................................................................. 21
     New Structure, New Turmoil .................................................................. 24

 Population, Employment and Trends in Injury
 and Industrial Disease ................................................................................ 27

     Population and Labour Force ................................................................. 27
     Industry Trends in Employment ............................................................. 32
     Summary ................................................................................................. 38
R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a , F i n a l R e p o r t

    VOLUME I




                                                 [Chapter 1]

                                           Introduction




                        T
                                he British Columbia workers’ compensation system has a long history.
                                The 1917 Workman’s Compensation Act predates the federal Old Age
                                Pensions Act by 10 years, the Unemployment Insurance Act by 23 years,
                        and the Medical Care Act, the basis of Canada’s healthcare system, by 50 years.

                        Based on principles first stated by the Honourable Sir William Meredith in his
                        1913 report, Laws Relating to the Liability of Employers, the system rose in the
                        second decade of this century to, according to the 1916 Committee of Investi-
                        gation on Workmen’s Compensation Laws:
                                  not only eliminate so far as possible the economic waste attend-
                                  ant on the present system in force in the Province, but which,
                                  while protecting the employer against personal—injury claims and
                                  ensuring the employee an enlarged and better measure of com-
                                  pensation, will in their common interest exercise a constant and
                                  direct force tending to improve personal relations between em-
                                  ployers and their employees, and to the creation of better work-
                                  ing conditions and the reduction of the opportunities for acci-
                                  dent.

                        The injuries these reformers sought to eliminate or compensate were relatively
                        easy to identify; they were acute and traumatic and appeared to be the product
                        of discrete and observable incidents. This is no longer the case.

                        Since the end of the Second World War, the work we do, the risks we face and
                        the people who do the work have all changed dramatically. At the same time
                        new knowledge of the long-term effects of occupational hazards has expanded




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    VOLUME I: CHAPTER 1   INTRODUCTION




                          the definition of “occupational injury” far beyond the original vision underlying
                          compensation legislation, while changes in the field of healthcare have revolu-
                          tionized both the way we treat injuries and the way we fund treatment.

                          The relationship of compensation boards to other agencies and systems has
                          also changed in the last half century. Once largely stand-alone, workers’ com-
                          pensation in Canada is now part of a social safety net that insures Canadians
                          against a variety of risks, including unemployment, health problems and the con-
                          sequences of old age and poverty. Decisions made by any one agency affect the
                          operations and resources of the others.

                          This section of this report places the workers’ compensation system, the Act
                          that regulates it, and the agency generally responsible for its operation and well-
                          being within a social and historical context. This section is not meant to be com-
                          prehensive. The issues touched on are varied and complex and any one of them
                          could justify a chapter of its own. Many of the issues are dealt with in more detail
                          in the body of this report.

                          The section begins with a brief history of workers’ compensation in BC from its
                          antecedents in the late nineteenth century to the establishment of this royal
                          commission in 1996. This is followed by a description of some of the trends that
                          will affect compensation systems well into the future.




6                         R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                      A B RIEF H ISTORY OF WORKERS ’
                                                                                      COMPENSATION IN BC


A Brief History of Workers’ Compensation in BC

THE WORKPLACE IN THE NINETEENTH CENTURY

There is comparatively little information on nineteenth century working condi-
tions in BC’s largest industries: mining and forestry. There is virtually none on
smaller enterprises such as agriculture and fishing (large-scale manufacturing
was non-existent in BC before the twentieth century).

Judging by the accounts that do exist, working conditions before the turn of the
century were harsh. Mining was particularly dangerous, with gas explosions in
the coal industry causing most of the casualties and deaths. James Dunsmuir’s
(provincial premier 1900 to 1902) Vancouver Island coal mines were notorious.
They had a “justly deserved reputation as the most dangerous in the world, with
a death rate three to four times that elsewhere in the British Empire.”

The effect of mining disasters on British Columbia’s small communities is hard
to overestimate. In general there was no systematic monetary relief for the doz-
ens of miners’ widows and their children. Vancouver Coal & Land Co. did provide
free housing and food for as long as needed, and public and private charity
appears to have prevented significant poverty from befalling dead miners’ de-
pendants on Vancouver Island, but such help was not necessarily available in
other jurisdictions. There are indications that some mines might have made ar-
rangements with workers to pool contributions toward injury and fatality funds.
In other cases, union-run injury relief funds and working men’s associations,
such as the Italian self-help societies that sprang up in Extension, Nanaimo and
Cumberland around the turn of the century, provided the services of a doctor or
minimal weekly payments. Unorganized workers, which include the majority of
working British Columbians, usually did not have any type of protection.

There are no indications that forestry, the province’s other major industry, or the
metalliferrous mines in the Interior produced anything close to the number of
injuries found in the coal mines.


STATE INITIATIVES TO PROTECT WORKERS

State-planned workers’ compensation in the West began in Prussia, part of mod-
ern-day Germany. Prussian Chancellor Otto von Bismarck (1815 to 1898) intro-
duced compulsory public workers’ compensation in 1884 amidst workplace ac-
tivism among Prussian workers. Bismarck’s legislation related “all social ben-
efits to a worker’s professional life” to instill “a strong partnership between
employers and employees.”




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    VOLUME I: CHAPTER 1   INTRODUCTION




                          Britain followed Bismarck’s lead with its own version of workers’ compensation
                          in 1897. Until the mid-1800s, English law used an informal, pre-industrial scale
                          which awarded compensation in the event of death according to the value of
                          the item that had caused the fatality. If a worker was crushed by a barrel worth
                          10 pounds sterling, the worker’s dependants received 10 pounds sterling. This
                          proved cost effective for employers in the pre-industrial era; it became less at-
                          tractive as machinery rose in cost and complexity and the economies in the
                          West moved ever more rapidly from farm and cottage-based production to fac-
                          tories, mines and mills.

                          The English compensation system changed substantially after the 1850s. Three
                          defences were created under common law:
                          • “contributory negligence”—if the worker was even slightly responsible for
                            the injury, the employer would not be found liable.
                          • “assumption of risk”—the employer could claim that there were certain una-
                            voidable risks associated with the job and the worker accepted those risks
                            when he entered into a contractual agreement to work for the employer.
                          • “fellow-servant”—if the employer could prove that a fellow employee was
                            even slightly responsible for the injured workers’ injury, then the employer
                            would not be liable.

                          These rules made it extremely difficult for workers to receive compensation
                          through the courts at a time when the number of injuries and fatalities suffered
                          by workers appears to have been growing.

                          As in England and other jurisdictions, in BC the only recourse to compensation
                          for workers and workers’ dependants was to sue. This difficult, if not impossible
                          proposition was complicated by the fact that many deceased workers were im-
                          migrants. It might be months before families became aware of a death; the
                          circumstances of the death might never be known. If the worker did sue, litiga-
                          tion often took months, sometimes years, and those workers who summoned
                          the resources to sue only had between a 20% and 30% chance of winning. In
                          the prevailing social and legal environment of the day, even if a worker con-
                          vinced a jury that monetary damages were due, jury-awarded damages were
                          often scaled back or completely overturned by presiding judges.

                          Despite the political power of employers in nineteenth century BC, there were
                          attempts to improve the odds of injured workers and their families in the courts.
                          In 1878, the Workman’s Protection Act was introduced to the legislature. The
                          bill—one of the very first attempts anywhere in the world to pass a law to help
                          injured workers—never got beyond the first reading.




8                         R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                      A B RIEF H ISTORY OF WORKERS ’
                                                                                      COMPENSATION IN BC


The BC Employers’ Liability Act of 1891 was the first legislation enacted in Canada
to help workers. The Act’s main feature was to severely limit the scope of the
“fellow-servant” defence. It also disallowed employer defences based upon de-
fective works or equipment and concisely and narrowly defined employers’ neg-
ligence.

The Act was neither comprehensive nor concise and left the courts a wide range
of interpretation. Though ground-breaking in its scope, it had a number of short-
comings, including the following:
• only railway workers and manual labourers were eligible;
• workers had to be at least 21 years old;
• cases had to be filed within 12 weeks for injuries or within one year for deaths
  (a big problem for deceased immigrant workers’ families who were over-
  seas);
• the case had to be filed in a set form which was difficult for some whose
  mother tongue was not English;
• acts of nature were not provided for; and
• compensation was limited to three years’ wages or an amount not to exceed
  $2,000.

Despite what appears to have been only modest legislative progress in protect-
ing workers, the courts were becoming more sympathetic. Encouraged by legal
precedents and often backed by the resources of BC’s growing labour unions,
lawsuits against employers increased steadily at a time when the recessionary
nature of the BC economy in the 1890s placed added financial pressures on
businesses. Because employers were vulnerable to financial instability, even a
successful defence could significantly affect businesses; an unsuccessful de-
fence could lead to bankruptcy.

In 1902 British Columbia passed Canada’s first Workmen’s Compensation Act
based almost word-for-word on the British Workmen’s Compensation Act of
1897. Labour unions openly supported the new Act. Employers were generally
not vocal in opposing the bill; however, the lumber industry was particularly
vehement in rejecting it.

The new legislation marked a fundamental departure from preceding compen-
sation legislation by providing compensation regardless of fault. For the first
time an injured worker received damages for injuries that arose “out of and in
the course of employment” regardless of negligence, unless the worker was
grossly at fault. The Act, which covered railway, factory, mine, engineering and
construction workers, provided a set scale of compensation and a system of




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 VOLUME I: CHAPTER 1   INTRODUCTION




                       arbitration, both of which were designed to keep potentially costly and lengthy
                       disputes out of the courts. Any committee that represented both an employer
                       and his workers, or any single arbitrator agreed on by both parties, could arbi-
                       trate. The courts could also be asked to appoint a judge to arbitrate. A non-judge
                       arbitrator could refer questions of law, as opposed to facts, to court judges.

                       The scale of compensation meant that the only major issue was fault. After a
                       waiting period of two weeks, an injured worker could expect to receive 50% of
                       his average weekly earnings during the previous 12 months of employment.
                       Dependants of a deceased worker received the equivalent of three years’ worth
                       of his employment earnings.

                       However, like the Employers’ Liability Act before it, the 1902 Workmen’s Com-
                       pensation Act was subjected to much criticism, including the following com-
                       plaints:
                       • While more workers were covered, many were left out, including loggers,
                         certain transportation workers and electrical workers.
                       • Compensation was limited to $1,500 for partial or total disability; many con-
                         sidered this too low.
                       • The arbitration system, though favored by government, was optional. Cases
                         still proceeded to the courts where there were many areas open to interpre-
                         tation because the Act was neither comprehensive nor concise.

                       From 1900 to 1914 the number of compensation cases going to court appears
                       to have increased significantly, indicating that the Act had not succeeded in
                       moving cases away from the courts. A handful of very large court awards to
                       injured workers and deceased workers’ dependants sent shockwaves through-
                       out the BC private sector. A single liability case could now destroy almost any
                       business, no matter what size. Many employers insured against liabilities through
                       private casualty insurance companies, often having to pay high premiums. Oth-
                       ers aggressively pursued private settlements with injured workers. Every attempt
                       to amend the 1902 Act failed.

                       By the second decade of the century, the logging industry had replaced coal
                       mining as BC’s most dangerous occupation. However, unlike mining, forestry
                       usually took place in remote environments far from civilization; government safety
                       inspections were rare and emergency healthcare was unheard of. Loggers’ camps
                       were notoriously unsanitary. To make matters worse, loggers were excluded
                       from the 1902 Act.




10                     R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                           A B RIEF H ISTORY OF WORKERS ’
                                                                                           COMPENSATION IN BC


THE HISTORIC COMPROMISE

The “historic compromise” in workers’ compensation that the Honourable Sir
William Meredith described in his 1913 Ontario report entitled Laws Relating to
the Liability of Employers, was succinctly restated by the Provincial Committee
of Investigation in 1916. The committee was mandated by the province to ad-
vise on workers’ compensation legislation proposed by the 1912 British Colum-
bia Royal Commission on Labour. It stated that:

        We believe that, though each class surrenders the State certain
        rights, it is in the public welfare that this should be so. The em-
        ployer in submitting to the levy of taxes upon his industry re-
        ceives the benefit of protection from expensive litigation, the
        workman in return, though he loses the precarious right to sue in
        tort for damages, receives in return a stipulated amount based
        upon his economic position in the community. Both, as well as
        the state as a whole benefit from the elimination of the friction
        and loss which necessarily attends litigation.

The Commission on Labour’s report to government had recommended a new
workers’ compensation Act rather than a revision to the Act of 1902. The com-
mission believed that this new Act should provide a state-sponsored manda-
tory scheme where the worker would give up the right to sue in the event of a
workplace injury in exchange for a guaranteed fixed amount, regardless of fault.
In return, the employer would be free from any tort liability. The commission re-
affirmed the basic principle of the 1902 Act, that “industry should bear the
burden of accidents as part of the cost of production”—24 North American
jurisdictions including Ontario already had a similar system.

Government generally supported the recommendations of the commission and
after a brief delay introduced a bill removing a worker’s right to sue his em-
ployer for damages in return for payment of 55% of the worker’s average earn-
ings, with a maximum payment of $40 per month. The proposed act covered a
wide range of industries and trades, including lumbering, logging, mining, mill-
ing, manufacturing, canning, shipbuilding, bricklaying, painting and structural
carpentry. It excluded government employees, fishermen, longshoremen, cleri-
cal workers and casual workers.

Labour slammed the government’s lack of consultation over the bill, stating
that “it is so limited in its scope, that it is to all intents and purposes useless....”
This sort of harsh condemnation prompted the formation of the Committee of
iIvestigation, commonly known as the select committee or the Pineo commis-
sion (Arvid Pineo, the provincial Deputy Attorney General, chaired the commit-
tee), to review the proposed Act.




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 VOLUME I: CHAPTER 1   INTRODUCTION




                       The committee’s report was submitted to the government in March 1916. It rec-
                       ommended a state sponsored scheme similar to the one in force in Ontario, with
                       two major exceptions: state administration, and an end to individual liability and
                       private insurer involvement in the system. The committee also recommended
                       full medical aid for injured workers, including doctor and hospital treatments,
                       transportation, medicine, crutches and other supplies necessary for their recov-
                       ery.

                       No other jurisdiction had such extensive medical provisions in place and em-
                       ployer witnesses to the select committee argued vociferously against the idea,
                       warning of skyrocketing cost. However, in a rare act of conciliation, a committee
                       composed of employers, the BC Federation of Labour and the Railway Brother-
                       hoods met privately and came to agreement on the medical aid issue. Workers’
                       would contribute to a medical aid fund at the fixed rate of one cent a day, and
                       employers would cover the difference if there was a shortfall. This guaranteed
                       immediate and full medical assistance for workers and ensured prompt pay-
                       ment to hospitals and doctors for their services.

                       The select committee also recommended:
                       • a three-day waiting period;
                       • a compensation rate of 55% of average earnings, up to $2,000 per year;
                       • payment of $20 per month plus $5 per child to deceased workers’ widows;
                       • a comprehensive system of government safety inspection that would deem
                         negligent employers liable to prosecutions and penalties;
                       • a tripartite board whose members would be “free from political influence”;
                         and
                       • no right of appeal of a Workmen’s Compensation Board decision.

                       The waiting period and safety inspection recommendations were uncommon in
                       other jurisdictions. The tripartite board was agreed upon after considerable dis-
                       satisfaction was expressed about one-man boards during the out-of-province
                       hearings. Most jurisdictions had an appeal mechanism of some sort.

                       The Act was introduced to the legislature and passed without controversy in
                       May 1916 and was scheduled to come into effect January 1, 1917. The legisla-
                       ture adopted every one of the committee’s major recommendations making BC
                       the only jurisdiction in North America with a full medical aid provision. The Act
                       included a comprehensive accident prevention scheme.

                       Edward Winn, a former lawyer, chaired the new three-person board. The head-
                       quarters, initially in Victoria, had 44 employees.




12                     R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                  A B RIEF H ISTORY OF WORKERS ’
                                                                                  COMPENSATION IN BC


The speaker of the Minnesota legislature headed a committee investigating
BC’s Act in 1920 and called it “the most efficient, economic and comprehensive
in Canada and the United States.” Other delegations from as far away as Sri
Lanka modeled their legislation based on the BC Act. (It should be noted that
while the Act did not cover all workers in BC, those excluded from it still had
access to the courts.)


GROWING PAINS

Allowing for amendments to increase benefits to deceased workers’ depend-
ants, an increase in the compensation rate to 62.5% of a worker’s average
earnings and a $300 penalty for employers for negligence, the honeymoon pe-
riod lasted about a decade. By the mid-1920s labour groups were lobbying for
an appeal board, a change in the method for calculating average earnings and
an expansion of occupations covered. At the same time newspapers began
publicizing individual cases where workers claimed the board had dealt with
them unfairly. Employers also complained that the board was collecting and
amassing too much money at their expense and there were general complaints
that the board was too autocratic.

The complaints prompted the government to appoint a legislative committee
to look into all aspects of the Workmen’s Compensation Board and Act in 1927.
Over a one-year period, five members of the legislature, as well as the three
board members, traveled to various locations in the province where they heard
from individual workers, union officials and employers. The committee recom-
mended that the board expand the number of compensable industrial diseases
and show more “elasticity” in administering the Act. The provincial government
did not respond to the report.

The Great Depression, Canada’s 10 lost years, had a profound affect on Cana-
dian society, and on the workers’ compensation system. As companies, espe-
cially small ones, disappeared into bankruptcy the remaining employers had to
cover the assessments of their fallen competitors, thereby placing their own
companies in a precarious situation. In 1932, 17 logging companies success-
fully sought a BC Supreme Court injunction to temporarily stop the Workmen’s
Compensation Board from levying assessments. The highly publicized trial, which
could have jeopardized the entire workers’ compensation system, lasted sev-
eral months, and the companies ultimately lost.

Many British Columbians believed that the board had become isolated and
needed oversight. There were also increasing demands to revise the Act by
members of the powerful railway workers’ unions. In 1938, the provincial gov-




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 VOLUME I: CHAPTER 1   INTRODUCTION




                       ernment introduced and passed amendments increasing benefits to injured
                       workers, and to widows and dependants of workers killed on the job. However,
                       these amendments did little to appease critics of the Act. It was clear that the
                       historic compromise introduced by the Honourable Sir William Meredith needed
                       to be reviewed. The provincial government created the first royal commission on
                       workers’ compensation in 1941.


                       ROYAL COMMISSION ON THE WORKMEN’S COMPENSATION BOARD
                       (1941 TO 1942)

                       The first commission on the Workmen’s Compensation Board was headed by
                       Gordon McGregor Sloan, chief justice of the Court of Appeal of BC. It lasted from
                       August 1941 until March 1942. The commission heard 160 witnesses, the majority
                       being union and industry representatives and members of the medical profession.

                       Perhaps the most controversial question addressed by Sloan in this first com-
                       mission was whether all workers should be covered by workers’ compensation.
                       Labour argued in favour, claiming that too many workers were falling through
                       the cracks. Industry was opposed, warning of skyrocketing assessments. Sloan,
                       citing the fact that no other jurisdiction had blanket coverage, recommended the
                       status quo.

                       Sloan also recommended that:
                       • the board continue without a medical appeal board;
                       • the Act retain the controversial three-day waiting period; and
                       • the board institute a comprehensive rehabilitation scheme (most jurisdictions
                         had some sort of program in place by the 1940s).

                       There were also a number of housekeeping recommendations touching on the
                       calculation of average earnings, the age of eligible dependent children, evaluat-
                       ing incapacity and adjusting allowances for dependants of deceased workers to
                       take inflation into account.

                       In general, industry was more unified in its demands and stances than labour;
                       coastal and interior unions and other labour groups did not effectively organize
                       to support one another’s causes. All the major industry witnesses held law de-
                       grees, while not a single labour witness had any formal legal background. La-
                       bour witnesses appeared to have difficulty in the trial-like atmosphere of Sloan’s
                       royal commission.

                       Both labour and industry reacted favourably to Sloan’s 400-page report tabled in
                       September 1942; only the BC Hospital Association was openly critical, citing
                       administrative and cost issues that it felt were not satisfactorily addressed by




14                     R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                   A B RIEF H ISTORY OF WORKERS ’
                                                                                   COMPENSATION IN BC


report. Six months later, a new government (there had been an election in the
interim) adopted the majority of the commission’s recommendations.

Despite the commission’s apparent success, demand for change once again es-
calated, and by 1945 the minister of labour was predicting a second royal com-
mission. The government tried to forestall this quick re-appointment of a com-
mission by introducing amendments to the Act, the most important of which
was to eliminate the workers’ contribution to the Medical Aid Fund. However, the
amendments, which were mostly minor, did not appease labour. The Cooperative
Commonwealth Federation (CCF) attempted to introduce amendments to the
Act in the legislature, while labour gatherings throughout the province passed
resolutions demanding blanket coverage, elimination of the waiting period and
access to treatment by chiropractors. The latter was a new and controversial
issue.


ROYAL COMMISSION RELATING TO THE WORKMEN’S COMPENSATION ACT
AND BOARD (1949 TO 1952)

Shortly after Sloan’s first report was acted on, the Second World War ended,
sending thousands of Canadian workers home from foreign battlefields. Tens
of thousands of these workers came to BC, swelling the ranks of the province’s
unions with skilled labourers, competent organizers and experienced lobbyists.
These unionists felt that Sloan’s commission was held during extraordinary times
when sacrifices had to be made, but that the war was over and the socioeco-
nomic and political environment needed to change.

The second Sloan royal commission began in September 1949 and ended two
years later, in November 1951. Testimony was heard from 630 witnesses, most
of them individual workers and medical doctors in four BC cities. Sloan also
inspected several rehabilitation centers in Canada and the United States.
Workplace and medical technology had changed considerably since the war
and much of the testimony centered on these changes. Monetary issues also
played a big part in the commission’s work, and post-war inflation provided a
sense of urgency to these issues.

Several of the issues addressed in the first commission re-surfaced in the sec-
ond. For example, labour and industry made the same arguments for and against
blanket coverage. Sloan listed all workers who were not currently covered and
expressed that some of them (e.g. agricultural workers and domestics) should
be covered while others should not (e.g. fishermen), but he still supported sec-
tor-by-sector inclusion and rejected blanket coverage.




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 VOLUME I: CHAPTER 1   INTRODUCTION




                       Sloan also recommended:
                       • a medical appeal board (and provided great detail as to how it should oper-
                         ate);
                       • a raise in the compensation rate from 66.66% to 70% of average earnings;
                         and
                       • when an injured worker was unable to resume former employment, the worker
                         should receive two-thirds of the difference between the former wage and the
                         new wage (this recommendation maintained the status quo).

                       Once again industry employed considerable legal talent, and labour often was
                       unable to effectively participate. However, there was a significant change in rep-
                       resentation: many members of the medical profession voluntarily testified on
                       behalf of workers. In fact, many of the debates were strictly between board staff
                       and doctors advocating on behalf of workers.

                       The reaction to Sloan’s second report was mixed, possibly due to the complexity
                       of the issues or the two-year wait for the report. Some labour officials expressed
                       mild disappointment, and others gave qualified approval. Business officials gen-
                       erally had little to say.

                       The report was handed down in a period of considerable turmoil. A weak coa-
                       lition government received the report but only adopted caretaker amendments
                       that raised widows’ pensions, dependent children’s allowances, minimum and
                       maximum payment levels, and the compensation rate to 70% of average earn-
                       ings. More substantial amendments were postponed for two years and two
                       elections.

                       When the political dust settled, the Social Credit government of W.A.C. Bennett,
                       which claimed to be neither pro-business nor pro-labour:
                       • established a medical review panel with binding powers;
                       • raised the compensation rate to 75%;
                       • provided optional coverage for domestic workers; and
                       • allowed chiropractors and non-conventional medical practitioners to be clas-
                         sified as physicians.

                       The Bennett government also abolished the 12-year tenure for board members.
                       This was a significant change to the original Act, and it was not recommended
                       by Sloan. Both industry and labour criticized it as an amendment created with-
                       out outside consultation.




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                                                                                     A B RIEF H ISTORY OF WORKERS ’
                                                                                     COMPENSATION IN BC


In 1955 the government once again amended the Act, providing more detail
and structure to the medical appeal board, increasing dependent children al-
lowances and providing optional coverage for fishermen. As was the case after
the first Sloan commission, however, no lasting consensus on workers’ com-
pensation and related issues would be achieved.


THE BOARD UNDER FIRE

In a long history of controversial individual cases where workers or their de-
pendants have felt unjustly treated by the Workmen’s Compensation Board,
possibly no individual protest received the publicity, or had the long-term affect
of the Beatrice Zucco case.

Zucco was the wife of a miner denied a silicosis pension by board doctors. In 1956
she staged a one-day protest with three of her young children outside the Work-
men’s Compensation Board. The protest garnered front-page newspaper cover-
age throughout BC. At first, the labour minister refused to meet with her, but he
relented when she moved her protest to the steps of the BC legislature. In an
unprecedented move, the minister ordered the board to review Zucco’s case im-
mediately.

Once again, the board rejected the pension claim. In response, the minister
consulted federal government officials about possible recourse for Zucco, and
several months later he announced an inquiry into the silicosis issue.

Dissatisfied with the probe, Zucco began a nine-day, round-the-clock vigil out-
side the BC legislature. When this was unsuccessful, she petitioned the provin-
cial cabinet to pass a law giving her husband special permission to sue the
board for a silicosis pension. Her request was denied, despite wide public sup-
port for her position.

Though she had exhausted her avenues for appeal, Beatrice Zucco had be-
come a rallying point for groups angry with the board. Shortly after the second
protest, a labour conference accused the board of “rigid formalism,” being too
slow in its administrative duties and rejecting too many workers’ claims on the
grounds of “legalistic arguments.” Some attendees also called for an overhaul
of the medical appeal board and a restriction to the board’s ability to exercise
discretion. At the same time, the Canadian Manufacturers Association and 15
other provincial employers asked the minister not to change the Workmen’s
Compensation Act, and criticized labour for not realizing how generous the ben-
efits in BC were and for ignoring “the underlying principles of the Act.” A del-
egation representing 100,000 workers asked the provincial cabinet to fire the
board chair, who had been on the job for two years, and his entire board. Edwin




                                                              FINAL    REPORT                                         17
 VOLUME I: CHAPTER 1   INTRODUCTION




                       Eades would be the first of many chairs to be personally demonized by various
                       interest groups.

                       By now, politicians from all parties, including government party members, were
                       calling for another royal commission. A legislative committee to probe workers’
                       compensation issues was rejected because the area was too politically charged.
                       Following two years of criticism, the board finally spoke out, stating that the Act,
                       not the board, was responsible for the problems. The board said it would wel-
                       come an inquiry.

                       With labour blaming the board, the board blaming the Act, and business favoring
                       the status quo, government tried to solve the problems through an extensive
                       package of legislative amendments passed in 1959. These amendments:
                       • significantly raised the compensation and allowance rates retroactive to sev-
                         eral years previous;
                       • extended coverage to industrial workers previously not covered;
                       • overhauled controversial appeal board procedures so that they more closely
                         resembled Chief Justice Sloan’s recommendations; and
                       • eased statutory restrictions on diagnosis of silicosis.

                       The changes were intended to give the board more statutory latitude to give
                       injured workers the benefit of the doubt. Beatrice Zucco could now receive a
                       widow’s pension, her husband having died in the intervening years.

                       Labour and industry took a generally positive view of these changes, though the
                       latter objected to the retroactive rate hikes. However, the consensus quickly broke
                       down. The mining industry, alarmed at rising assessment rates due to an in-
                       crease in successful silicosis claims, accused the board of being too liberal in its
                       rulings. The largest mining union also criticized the board for its handling of
                       silicosis claims and called for a review of the Act. By 1961 an exasperated gov-
                       ernment started to drop hints of a new royal commission.


                       COMMISSION OF INQUIRY, WORKMEN’S COMPENSATION ACT (1962 TO 1965)

                       The third royal commission on workers’ compensation issues was appointed in
                       1962 and began hearings in October. Alexander Campbell DesBrisay, one of in-
                       dustry’s lead counsellors in the second Sloan commission and now chief justice
                       of the BC Appeal Court, was selected to meet the challenge of probing workers’
                       compensation issues.




18                     R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a
                                                                                     A B RIEF H ISTORY OF WORKERS ’
                                                                                     COMPENSATION IN BC


Unlike the previous commissions, the board, and not the Act, was now the
focus of controversy. BC Federation of Labour representatives stated that the
board was the main reason the number of rejected claims had taken a sharp
upward turn recently, and described the board as mean-spirited and insensi-
tive. This sentiment was echoed by the Teamster’s Union, which claimed to
have little dispute with the Act but much with the board.

The commission hearings ran for nearly three years, ending in November 1964
(DesBrisay suddenly passed away in 1963 and Justice Charles Tysoe of the BC
Court of Appeal replaced him). There were over 200 witnesses, but unlike the
Sloan commissions, staff tried to limit the lengthy hearings by screening poten-
tial witnesses. Both the labour and business sectors in BC had fragmented
since the previous commission so more representatives testified for both groups.

For the first time, some sectors of the labour movement had legal counsel,
which meant that labour was more involved in technical issues and made more
detailed submissions and speeches. Employers also retained legal counsel,
though not to the extent they had previously. Business organizations were more
indifferent toward the hearings than they had been in the past. Medical profes-
sionals were again prominent, though not as numerous as before. Tysoe made
mention of the fact that both sides’ participants tended to be “laymen” for the
most part.

Monetary allowance and benefit rates were once again major issues, and Tysoe
sided with labour on almost all of them. However, the three-day waiting period,
a source of controversy since 1917, was upheld—Tysoe feared too great a fi-
nancial burden on business. Tysoe also upheld the compensation rate which
labour wanted raised to 100%, citing other jurisdictions and the previous com-
mission’s report.

Neither labour nor business could come up with many substantial suggestions
for revamping the medical appeal board. Tysoe made a number of recommen-
dations to give the medical appeal board more autonomy and capacity to act
more efficiently, but warned interest groups to expect another trial-and-error
period. According to Tysoe, the advent of unemployment insurance in 1940
protected injured workers who were temporarily unable to resume their previ-
ous occupation, but were still able to work, and couldn’t find any alternate work.
In an unprecedented move, the commissioner suggested that future benefits
and allowances be tied to the cost of living.

Tysoe released an interim report in November 1965 and the final report in Janu-
ary 1966. (The long delay in reporting was in part because Tysoe needed to
review DesBrisay’s work. It was further complicated by the fact that the lack of




                                                              FINAL    REPORT                                         19
 VOLUME I: CHAPTER 1   INTRODUCTION




                       medical and legal representation to the commission placed the onus on the com-
                       missioner and staff to conduct analyses.) The premier announced that govern-
                       ment would “carry out every recommendation of that report.” It immediately
                       increased benefits and pensions retroactive to January 1, 1965, and tied future
                       benefit increases to the consumer price index through an order-in-council.

                       Tysoe’s report was generally seen to favour labour, and labour largely endorsed
                       it. Business focused its comments on pensions and benefits being tied to the
                       consumer price index, especially with the rapidly rising inflation rate in late 1960s.
                       The chair of the BC wing of the Canadian Manufacturers’ Association said, “be-
                       cause of the serious ramifications these increases will have on BC industry the
                       government should accept its responsibility and assume the annual costs of
                       these benefits.” A representative of the BC Mining Association said, “Very few
                       people realize that the total impact of all these things amount to a tremendous
                       amount of dollars.”

                       Despite its initial promise to enact Tysoe’s recommendations, government an-
                       nounced that amendments to the Act would be delayed until the next legislative
                       session, a delay of at least six months. This led to a bitter debate. The opposition
                       New Democratic Party (NDP) orchestrated a filibuster and organized labour groups
                       threatened a general strike to protest the delay.

                       Government did not back down. Nor did it introduce amendments in the next
                       session. Even though legislation was before the assembly and was expected to
                       be passed, government withdrew it and announced a year’s delay for a legisla-
                       tive committee to study the report prior to tabling a completely new Act. This
                       announcement drew opposition not only from rival parties in the legislature but
                       even from government backbenchers.

                       The new Act tabled in March 1968 adopted virtually all of Tysoe’s recommenda-
                       tions. Significant changes included:
                       • simplifying the terms under which a worker could claim that an injury was the
                         result of an industrial accident;
                       • coverage for volunteer workers; and
                       • shifting the onus of proof from the worker to the board.

                       The leader of the opposition Liberals said the year’s delay for detailed study by a
                       legislative committee was worth it and that this was “the way parliamentary
                       procedure in a democracy should work.”

                       In 1972, with an election in the offing, government eliminated the waiting period,
                       upgraded some first-aid features, raised pension bases and extended the time
                       limit for a worker to file a claim.




20                     R o y a l C o m m i s s i o n o n W o r k e r s’ C o m p e n s a t i o n i n B r i t i s h C o l u m b i a

				
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