Court decision sheds more light on WCB, SASM court dispute

Details from a court decision between the Sask. Workers’ Compensation Board (WCB) and the Safety Association of Saskatchewan Manufacturers (SASM) have shed more light on the situation.

Last month, 980 CJME reported on the dispute, explaining both sides were suing each other. The WCB claimed SASM wouldn’t complete audits, and demanded its assets back from the group after ending payment of levies from employers. At the same time, SASM filed a countersuit, claiming things like breach of contract, breach of trust and damage to reputation, and explaining the situation as unfair and an overreach.

Now, a judge has ruled on interim orders in the case, siding with the WCB. The written decision also added more detail about what’s been happening between the two groups.

The decision quotes WCB CEO Phil Germain, explaining that SASM’s deal with WCB meant it could only use WCB funding for the purposes outlined in the strategic plan, that it couldn’t put funds from the WCB together with funds from private sales from non-rate code members, and it had to identify any surplus at the end of the year.

The decision also talks about an audit Deloitte did on SASM in 2020, that found the safety association hadn’t sufficiently reported on excess surplus funds, hadn’t provided enough support for the hours indicated to safety services, and would only give photos of its ledger, not the ledger itself.

While SASM provided the WCB with audited financial statements for 2022, the judge wrote the statements didn’t explain which activities or initiatives were paid for by the WCB funding and which were supported by the funds from private sales — the agreement between the two specified that members buying safety training privately couldn’t also benefit from WCB funding.

Looking at the money, the WCB claimed to the court that the 2022 audited financials for SASM showed $536,672 in assets which weren’t related to the WCB funding, plus $145,636 from the WCB funding. However, the statement also showed SASM spent $1,143,592 from the WCB funds, and $75,399 from the non-WCB funds for the year.

In court documents, the head of SASM Desira Rostad said that until 2021 none of the agreements between SASM and WCB required that WCB and non-WCB revenue and expenses be separated.

SASM has said all along that it can’t give WCB information related to its non-WCB business because it includes proprietary information and their clients expect privacy.

WCB is in court demanding a number of things from SASM, including the safety association to return all the funds and assets that came from the WCB.

In the court documents, Rostad was quoted as saying the WCB funds have been used up in trying to operate since the WCB stopped forwarding levies to SASM.\

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Murray Yeager, vice-president of manufacturing at Brandt Industries Canada Ltd., gave an affidavit for the case.

Brandt was a client under SASM and got training from the association. He said in his affidavit that he got wind of what was happening between SASM and the WCB through a letter saying that SASM was no longer being funded through the WCB, so Brandt would have to buy safety services directly from SASM going forward.

Yeager said Brandt and other rate code members heard from the WCB as well, and eventually asked SASM to co-operate with the WCB requests and also called on the SASM board of directors to resign, but to no avail.

Brandt’s membership with SASM expired and was not renewed.

The decision from Court of King’s Bench did not decide the whole issue between SASM and WCB but did decide some orders for the meantime.

The WCB was granted a preservation order to stop SASM from destroying or disposing of any property that could be the WCB’s, including money that could end up being part of a future judgment.

The judge deemed that the $20,000 already paid to the court by way of security would stand.

SASM’s application for an injunction to stop the WCB from interfering with its internal governance or communicating with its rate members was denied.

And SASM’s application for a preservation order stopping the WCB from dissipating the funds from the rate-code levies SASM has previously received was dismissed as well.

SASM was ordered to pay costs to the WCB.

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