WCB faces bullying allegations in dispute with safety association

The Workers’ Compensation Board is the only place to go in Saskatchewan if a person is hurt at work, and its mission for years has been to reduce the number of workplace injuries.

However, it’s currently in the middle of a fight with one of the groups that provides training meant to reduce those injuries, and the group’s survival could be in the balance.

Safety Association of Saskatchewan Manufacturers (SASM) incorporated in 2011. It provides safety training to manufacturing companies in the province and, until recently, received levies collected from industry by the WCB for that purpose.

However right now, a good chunk of the employers have moved from SASM to its motor safety cousin, the WCB has stopped paying it levies, and is taking SASM to court.

Private Information

It’s a dispute between SASM and the WCB over its contract, or lack thereof, and how much information the WCB is entitled to from SASM.

While one side of SASM’s business provides training funded by the WCB levies, it also has a private section which sells other safety training and assessments the WCB doesn’t do, like safeguarding engineering and audiometric testing.

Desira Rostad is the head of SASM. She said the years-long dispute has centred around the WCB wanting details and information from the private side, which she maintains it’s not entitled to.

Rostad explained most of the employers who utilize the private side of the business don’t want that information given to the WCB because it can include trade secrets to their manufacturing. She said they don’t want the WCB to even know what services they’ve accessed and, in some cases, have had SASM sign non-disclosure agreements.

According to Rostad, that separation has been important to industry since she started working at SASM nine years ago.

“When you would go to site with them, people wouldn’t even work with us if they thought we were associated with WCB, if they thought we were going to give anything to them (WCB),” she explained.

She said there could be lawsuits if that information was shared and, at the very least, employers wouldn’t trust working with SASM anymore.

Funding

Since 2020, Rostad said the WCB has tried to get SASM to sign funding agreements which include giving the WCB more reach into the business and into the private side of the company.

The WCB’s court documents state the WCB has the right to monitor and evaluate a safety association’s reporting and to audit them. It also states funding agreements require an association to use the funds only for outlined purpose, identify any surplus, provide reporting and documentation, permit an audit, and return all assets that came from the WCB’s funds back to the WCB when the agreement ends.

The WCB claims SASM has not allowed or completed required audits, but Rostad said the company has completed multiple audits, spending $90,000. She said what the WCB really wanted out of those audits was information from SASM’s private side, however she claims the WCB can’t audit external revenue.

Documents released by the Buffalo Party, a registered political party in Saskatchewan politics, show employers in the industry actually filed complaints about what was going on, calling it bullying, unethical practices and asked for an investigator to look into it.

The two sides eventually went to mediation and Rostad said SASM thought a deal had been figured out and the WCB had said to tell its members a deal would be forthcoming, but SASM claims no deal was ever presented.

“After all that, WCB is now claiming we didn’t have an agreement. We did have an agreement – we were told to follow our agreement,” said Rostad.

In court documents, the WCB claims the funding agreement was terminated. Rostad argues the previous one expired and no new one was presented to be signed.

Through the subsequent budget process, Rostad said the WCB tried to claw back more than $400,000 from SASM because there was money in a reserve account, but Rostad claims that money was all external revenue.

“SASM did (request an arbitrator) because they clawed back that funding and that was part of that pilot process. No arbitrator was ever provided to us,” said Rostad.

Minister of Labour Relations Don McMorris declined to comment on the situation because it’s before the courts and, as such, did not reply to specific questions like why he didn’t respond to the request for arbitration. Instead, his office sent a statement which was nearly word-for-word identical to the statement sent by the WCB.

Losing customers

Rostad claims the WCB went behind SASM’s back and spoke to its members in January, telling them SASM was no longer an option for a safety association. Some members moved to another association and the WCB stopped sending the rate code levies to SASM.

“(Some members were) like ‘we’re just tired of the drama with WCB and we just want to get our services,’” said Rostad.

SASM is no longer listed among the province’s safety associations on the WCB website.

Those who left SASM went to motor safety, which Rostad said does good work, but that the association isn’t currently equipped to provide the kind of safety training manufacturing companies need – so the employers are paying their levies to the WCB, but some are still buying training from SASM.

Rostad admits the agreement between SASM and the WCB did expire, but she said safety associations have operated under expired agreements before. She pointed to the 2022 Provincial Auditor’s Report which talked about the Heavy Construction Safety Association not having a signed agreement for 2021 or 2022 – it is still currently operating as a safety association.

“They got their funding,” Rostad said. “They didn’t get their assets taken back, they weren’t taken to court. WCB did not have meetings with their members, WCB did not tell their members that there was only three options and they were not one of them. How did that happen?”

Court

The WCB has now taken SASM to court, filing to take control of SASM’s assets. The WCB said in court documents those assets would include the training material, but Rostad claims that material was from a previous iteration of SASM and wasn’t created with funding from the WCB.

SASM is defending itself against the WCB’s claim and putting in a counterclaim talking about breach of contract, breach of trust and fiduciary duty, breach of duty and good faith, conspiring to usurp SASM’s authority, and damage to reputation.

Meanwhile, the Buffalo Party said it’s talking to the RCMP about the whole situation, claiming the WCB’s CEO Phil Germaine’s previous interest in a private safety training company which is a direct competitor to SASM, has something to do with it.

“It’s an absolute conflict of interest because you can’t be part of a safety company when you work WCB,” said party leader Phillip Zajac.

The RCMP would not say whether or not it’s investigating Zajac’s allegations.

Documents obtained by the party show complaints that were filed against the WCB — the first was filed in 2021, and alleges the WCB is trying to limit the safety advice and training that’s offered to non-WCB rate code members.

Other documents allege a business partner of Germaine’s outside the WCB knew about a funding contract in 2022, before it was presented to the safety associations, that included a conflict of interest clause which would have stopped SASM from selling its private memberships and services.

The Buffalo Party also has multiple letters that seem to show pleas for help made to the Minister of Labour over the situation, including a request for a third-party investigator.

From the WCB

The WCB declined to provide someone to answer questions about SASM or Phil Germaine, given this is before the court. It did provide a statement.

The statement said the WCB believes there’s great value in well-run safety associations, and that it has a legal responsibility to make sure money given to associations is used for the intended purpose.

The WCB said funding agreements have been signed with six of the safety associations, and “we are disappointed mediation proved unsuccessful with the one remaining safety association.”

It also said the impacted rate code members made their own decisions when it comes to getting their safety services.

“The WCB is committed to protecting Saskatchewan workers and businesses through innovative and effective programs and services and will continue to work with the industry partners to ensure they have access to the work of a safety association in whatever form that might take,” read the statement.