Board also approves $21M surplus distribution to employers
The Workers Compensation Board (WCB) of Prince Edward Island (PEI) has just revealed some good news for Islander employers. The WCB announced an 8.8% reduction in its estimated average assessment rate for 2024. This move brings the 2024 average rate down to $1.25 per $100 of assessable payroll, a significant drop from the $1.37 rate in 2023.
Assessment rates are determined annually by the WCB Board of Directors and are calculated based on a per $100 of assessable payroll metric. Additionally, the maximum assessable earnings (MAE) have seen a notable increase, going from $65,000 in 2023 to $78,400 as of January 1, 2024. The MAE is the maximum amount of earnings an employer would pay premiums on per worker. This change is a result of the introduction of benefit enhancements last year and will help ensure that more Islanders have their full earnings covered by the WCB.
Jim MacPhee, chair of the PEI WCB, says "we are pleased to continue the trend of decreasing assessment rates for Island employers. The WCB’s strong funded position creates the opportunity to pursue service delivery and benefit enhancements for injured workers while continuing to reduce employer assessment rates."
Based on the funding status as of December 31, 2022, the board of directors has also approved a $21 million surplus distribution to employers. This surplus distribution stems from investment returns, which can fluctuate from year to year, and is considered on an annual basis by the Board of Directors.
The WCB's funding policy is designed to protect employers by maintaining affordable and stable rates for coverage while ensuring the sustainability of the accident fund. The reduction in the average rate for 2024 was made possible due to several factors, including strong investment returns in 2022, growth in the Island’s assessable payroll, a focus on injury prevention, and efforts to facilitate workers' return to work.
Employers across PEI can expect to receive information about their individual assessment rates in December 2023. These rates will be determined based on the cost of claims, the risks of workplace injury in their specific industries, and the assessment rates by industry group. The surplus funds will also be distributed to eligible employers in December 2023.
