History of Workers' CompensationThe concept of workers' compensation had its origins in Germany, Great Britain and the United States between the late 1800's and early 1900's.
In Germany, Chancellor Otto Von Bismarck introduced a compulsory state run accident compensation system between 1884-1886. This initial system was financed by workers and employers.
In the United States, between 1908 & 1915, several states enacted compensation legislation. The state of Washington enacted an exclusive mandatory system based on collective liability. As compensation was given state jurisdiction, the US developed a mixed bag of WCBs, mandatory insurance, self-insurance and combinations.
Workers' compensation in Canada had its beginnings in the province of Ontario. In 1910, Mr. Justice William Meredith was appointed to a Royal Commission to study workers' compensation. His final report, known as the Meredith Report was produced in 1913.
The Meredith Report outlined a trade-off in which workers' relinquish their right to sue in exchange for compensation benefits. Meredith advocated for no-fault insurance, collective liability, independent administration, and exclusive jurisdiction. The system exists at arms-length from the government and is shielded from political influence, allowing only limited powers to the Minister responsible.
There were five basic cornerstones to the original workers' compensation laws; cornerstones which have survived, to a greater or lesser extent, as follows:
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No-fault compensation: Workplace injuries are compensated regardless of fault. The worker and employer waive the right to sue. There is no argument over responsibility or liability for an injury. Fault becomes irrelevant, and providing compensation becomes the focus.
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Collective liability: The total cost of the compensation system is shared by all employers. All employers contribute to a common fund. Financial liability becomes their collective responsibility.
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Security of payment: A fund is established to guarantee that compensation monies will be available. Injured workers are assured of prompt compensation and future benefits.
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Exclusive jurisdiction: All compensation claims are directed solely to the compensation board. The board is the decision-maker and final authority for all claims. The board is not bound by legal precedent; it has the power and authority to judge each case on its individual merits.
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Independent board: The governing board is both autonomous and non-political. The board is financially independent of government or any special interest group. The administration of the system is focused on the needs of its employer and worker clients, providing service with efficiency and impartiality. |
These are known as the 'Meredith Principles'. See the 'Meredith Report' for more information.
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