2016Annual ReportLETTER TO THE MINISTERThe Honourable Cliff Cullen Minister of Growth, Enterprise and Trade Room 358, Legislative Building Winnipeg, MB R3C 0V8Dear Minister:We are pleased to present our 2016 Annual Report in accordance with the provisions of The Workers Compensation Act. This report covers the 12-month period from January 1 to December 31, 2016. It includes the statements of accounts required to be kept under the Act.Respectfully submitted,Michael D. Werier ChairpersonTABLE OF CONTENTS About the WCB 5Vision, Mission and Values 6Message from the Chairperson 7Message from the President and CEO 8Board of Directors and Board Committees 10Our Customers 13Our System 14Our Partners 17Our People 18SAFE Work Manitoba 21SAFE Work Manitoba Financials 22Year at a Glance 23Historical Trends 24Financial Report 26Management’s Responsibility for Financial Information 262016 Management Discussion and Analysis 27Risk Management 32Actuarial Opinion 33Actuarial Review 34Independent Auditors’ Report 35 Consolidated Financial Statements 36To learn about the WCB’s future plans, please refer to the 2017-2021 Five Year Plan at www.wcb.mb.ca.4 2016 WCB ANNUAL REPORTABOUT THE WCBThe Workers Compensation Board of Manitoba (WCB) is a mutual workplace injury and disability insurance agency funded by employer premiums. With a mandate to prevent workplace injuries and illnesses, the WCB and its approximately 625 staff are committed to building a culture of health and safety throughout Manitoba.Services and BenefitsIf people are hurt or become ill as a result of their work, the WCB is here to help, offering a wide range of benefits to assist injured workers in returning to health and meaningful work as soon as safely possible. Some of the benefits offered include:• replacement of lost income• healthcare treatments and payment of medication costs• employment retraining• lump sum payments for permanent impairments• benefits to partners and children in the event of a workplace fatality.As part of the WCB’s commitment to quality service and fair process, injured workers, their dependants and employers may contact the Fair Practices Advocate (FPA), an independent office that works to ensure fair practices at the WCB. Further information is available at www.fairpracticesofficemb.ca.AVERAGE ASSESSMENT RATEper $100 of Assessable PayrollDAYS LOST TO WORKPLACE INJURY OR ILLNESS 1.67per full time workerIn compliance with The Public Interest Disclosure (Whistleblower Protection) Act, the WCB has whistleblower disclosure procedures in place. There were no disclosures reported in 2016.2014 $1.502013 $1.502015 $1.302016 $1.252012 $1.502016 WCB ANNUAL REPORT 5ourcustomersOur Strategic PrioritiesOur Customers – Understanding the diverse needs and expectations of workers and employers. Providing proactive and relevant services.Our System – Protecting the integrity of the compensation system. Honouring our governing principles and delivering on our mandate.Our Partners – Collaborating with our partners to deliver superior services and build a safer Manitoba.Our People – Engaging our employees to harness their commitment and passion. Developing our capabilities and our capacity to excel.Our ValuesIntegrity • Compassion • Innovation • Accountability • CollaborationOur VisionA trusted partner, insuring today and building a safer tomorrow.Our MissionWe are here to insure and support safe and healthy work and workplaces.We put workers and employers at the centre of all we do.We provide them with valued services for injury prevention, compensation and return to health and work while maintaining system integrity.6 2016 WCB ANNUAL REPORTIt was 100 years ago, on September 1, 1916, that 14 staff members began work at the Workers Compensation Board of Manitoba (WCB). A commissioner, auditors, medical officers, clerks and stenographers gathered in the Paris Building on Winnipeg’s Portage Avenue to set up the workers compensation system that would shape our province and city for future generations.Workers compensation was the first social system adopted in Canada; before Employment Insurance, the Canada Pension Plan or Medicare. This historic legacy is one that we, the Board of Directors of the WCB, cherish and honour. We work together to establish the WCB’s strategic direction, approve the policies that guide the organization and monitor the progress that the organization makes towards reaching its strategic goals. The work of the Board benefits from the experience and diverse representation of employers, workers and the public interest.The Board’s commitment to strong governance continues to benefit from the perspective that new members bring. In 2016, Yvette Milner joined the Board as a new employer representative, Sylvia Farley and Jean-Guy Bourgeois joined the Board as new worker representatives and Peter Dyck joined as a new public interest representative. We said farewell to many long-term Board members and we extend our thanks to Paul Challoner, Wendy Sol, Ron Stecy and Ken Sutherland for their years of service to the workers compensation system.In 2016, the Board was active on the prevention front and consulted with stakeholders on funding industry-based safety programs. The Board, with the assistance of the Prevention Committee, also achieved several milestones by approving new policies for a safety certification program and a prevention rebate policy. The Board also approved a number of other policy revisions. For example, to enhance clarity and assist workers and employers in understanding how the WCB determines impairment ratings and benefits, four policies and associated rating schedules were condensed into one policy with two rating schedules. In addition, the Board continued its oversight of the WCB’s investments through revisions to the fund’s policy asset mix. The Board also continued to review and monitor the WCB’s progress on implementing the assessment rate model. In 2016, the WCB phased in changes to the way premiums are calculated. These changes address employers’ key concerns by reducing rate volatility, providing more collective liability protection and ensuring balance and fairness. Working with the Executive Management Committee, the Board also continues to monitor and provide direction on Mental Health in the Workplace as it relates to injury prevention and return to work activities and in relation to our internal organization. I would like to acknowledge and thank our dedicated Board members for their active participation in guiding the organization. I also would like to acknowledge previous Boards who have helped shape and guide the WCB over the years so that we stand today celebrating 100 years of serving Manitobans.On behalf of my colleagues, I also extend my thanks to all of the staff for their hard work in 2016 in support of the Board’s vision of being A trusted partner, insuring today and building a safer tomorrow.Michael D. WerierChairpersonMESSAGE FROM THE CHAIRPERSON2016 WCB ANNUAL REPORT 7On September 1, 1916, the WCB was officially formed. The first 14 staff members were tasked with the job of developing the structure and processes necessary to put the original Workmen’s Compensation Act into effect. They were building a piece of history, a system that was the first social program adopted in Canada. Even more impressive is that the principles on which our system was built still hold true today. Each and every one of our jobs at the WCB is based on a historic compromise struck more than 100 years ago between workers and employers. We protect it, we safeguard it and we ensure the system remains fair in the face of a changing society. It is only fitting that in 2016 we continued our progress in modernizing the workers compensation system to meet the future needs of our customers. Work on the assessment rate model continued with our commitment to lessen the impact of transitional changes to small and medium-sized employers. We were able to achieve this goal due to our strong financial position, which allowed us to reduce the 2016 average assessment rate to $1.25 and announce a 2017 average assessment rate of $1.10. The ongoing trend of returning surplus funds to employers via a rate reduction has occurred due to our strong investment income which helped boost our funded position; and employers’ efforts and successes in injury prevention and return to work. Since 2014, two consecutive years of rate decreases returned $85 million to employers. Further, the rate decreases considered in our upcoming Five Year Plan (2017-2021) are projected to return an additional $521 million to employers.Our efforts to keep Manitoba workers safe in the workplace continued on many fronts. In 2016, we introduced SAFE Work Certified, a safety and health certification standard that will help make workplaces safer and provide a financial reward to employers that take proactive steps to prevent workplace injuries and illnesses. We also introduced a prevention rebate program that will be paid in 2018 to employers who achieve safety and health certification that meets the SAFE Work Certified standard in 2017. Employers that qualify for the rebate will be eligible to receive an annual rebate of 15 per cent of their assessment premium, while smaller employers will be eligible to receive up to $3,000.In 2016, we continued work to increase capacity for the delivery of relevant, cost-effective safety services by enhancing support for existing safety programs and assisting with the formation of new safety programs. Made Safe is our province’s newest industry-based safety program serving the manufacturing sector. As well, SAFE Work Manitoba assisted Keystone Agricultural Producers in establishing the Manitoba Farm Safety Program. The program will provide MESSAGE FROM THE PRESIDENT AND CEOPERCENTAGE OF WORKFORCE COVERED 77%REGISTERED EMPLOYERS35,4278 2016 WCB ANNUAL REPORTpractical, on-farm expertise, resources and training to make Manitoba’s farms safer for farmers, their families and workers. We also worked with other organizations to develop a strategy that will raise the awareness of psychological health and safety in the workplace. Our efforts to enhance return to work made great strides. Our Return to Work Program Services team led the charge by using business intelligence to identify employers who would benefit from our personalized services. Through consultation and education, we are reshaping how businesses view return to work as a means to keep injured workers engaged with the workplace and contributing to the bottom line by focusing on capabilities and what is possible with modified work.We are also providing support and technical expertise to The Workers Compensation Act Legislative Review Committee 2016 (LRC). The LRC is charged with consulting with Manitobans to ensure The Workers Compensation Act meets the needs of future employers and injured workers. The final report may result in legislative changes that will further impact how we operate in the future.The journey we are on to our chosen future state is the result of many years of stakeholder consultation and several complex internal and external studies and reviews. We are changing the fundamental components of our system and by doing so are re-engineering the WCB system. These, and many more initiatives, are bringing us closer to achieving our overriding end state: to reduce the risk and lessen the impact of workplace injuries and illnesses. We will become a province with an all-time low in days lost to workplace injury, with a system that is fair and efficient, with customers that get seamless service, with partners who feel their views count and with staff who are proud to work at the WCB. As we mark a century of progress we celebrate our kinship with those first 14 employees and the role we play in being A trusted partner, insuring today and building a safer tomorrow.Winston MaharajPresident and CEO2016 WCB ANNUAL REPORT 9Next >