Alberta’s Workers’ Compensation Board (WCB) has set the 2012 maximum insurable earnings at $86,700, a 4.7-per-cent increase from the current maximum of $82,800.
Maximum insurable earnings has two roles — it is the maximum earnings for each worker on which an employer must pay premiums and it is also the maximum earnings a claimant can be compensated, which helps to balance premiums and expected losses, according to the Alberta WCB.
From 2007 to 2009, the WCB’s board of directors set the maximum insurable earnings at a capped rate of six-per-cent growth.
In 2010, the board of directors adopted 2011 maximum insurable earnings of $82,800, which was a 7.5-per-cent increase over 2010. This was done because the previously capped rate had resulted in a more gradual attainment of 90-per-cent coverage than the board envisioned in 2007.
Statistics Canada said Alberta’s wage inflation declined in 2009 and 2010 relative to 2005 and 2008, which facilitated a more rapid catch-up to the target of 90-per-cent coverage. This means the full target is expected to be achieved with the 4.7-per-cent increase.
Subsequent increases will depend upon actual wage inflation but is expected to remain below six per cent in the next few years, according to the WCB’s current economic assumptions.
© Copyright Canadian HR Reporter, HAB Press. All rights reserved.