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Act Now - The Report of the WCB Legislative Review Panel to the

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3.6.5 Indexing Compensation by CommunitySome stakeholders suggested that <strong>the</strong> basis for calculating financial compensation shouldinclude a fac<strong>to</strong>r for <strong>the</strong> injured worker’s community <strong>of</strong> residence.<strong>The</strong> majority <strong>of</strong> respondents <strong>to</strong> <strong>the</strong> Stakeholder Questionnaire disagreed with thissuggestion.No o<strong>the</strong>r jurisdictions provide for indexing <strong>of</strong> financial compensation.<strong>The</strong> <strong>Panel</strong> does not agree with <strong>the</strong> suggestion and makes no recommendations for change.3.6.6 Net Annual RemunerationSome stakeholders suggested that some or all <strong>of</strong> <strong>the</strong> statu<strong>to</strong>ry deductions (Subsection39(5)) should not be subtracted from a worker’s remuneration when calculating netannual remuneration. <strong>The</strong>y argue that while injured workers are receiving financialcompensation, <strong>the</strong>y are not able <strong>to</strong> contribute <strong>to</strong> <strong>the</strong> Canada Pension Plan or apply forEmployment Insurance benefits. Contributions <strong>to</strong> <strong>the</strong> Canada Pension Plan are based onincome. Compensation is not considered income, and this is why it is not taxable, asnoted earlier.<strong>The</strong> majority <strong>of</strong> respondents <strong>to</strong> <strong>the</strong> Stakeholder Questionnaire thought that income taxshould be deducted, with some saying Employment Insurance premiums and CanadaPension Plan contributions should be deducted.All but 2 jurisdictions use a net annual remuneration for calculating financialcompensation.After consideration, <strong>the</strong> <strong>Panel</strong> believes that deducting statu<strong>to</strong>ry contributions from wagesmakes sense. By deducting income tax payable, <strong>the</strong>re is recognition <strong>of</strong> an injuredworker’s family status in <strong>the</strong> amount <strong>of</strong> financial compensation.<strong>WCB</strong> <strong>Legislative</strong> <strong>Review</strong> <strong>Panel</strong> <strong>Report</strong> Page 58 <strong>of</strong> 128December, 2001

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