Document name

Vocational Rehabilitation – Self- Employment Plans

Document number

PRO 11/2014

Customer means an injured worker, or surviving dependent spouse.

Individualized vocational plan (IVP) means a plan approved and signed by the Workers’ Compensation Board (WCB) and signed by the customer to meet a vocational goal. The IVP outlines the short and long-term goals for a suitable return-to-work plan.

1. POL 23/2016, Vocational Rehabilitation – Programs and Services governs vocational rehabilitation programs and services offered to customers, including IVPs for self-employment.
2. The following procedure provides administrative guidelines for the approval and implementation of IVPs for self-employment.

General

1. The Vocational Rehabilitation Specialist (VRS) will only consider an IVP for self-employment when there are no other options for re-employment (see the Hierarchy of Objectives noted in POL 23/2016, Vocational Rehabilitation – Programs and Services). In general, the VRS will only consider self-employment if the following two conditions are met:
   1. The customer cannot return to their pre-injury job or work at a different job because of the work injury. The WCB may consider the impact of non work-related injuries and quality of life issues when making decisions about self-employment.
   2. Self-employment is cost-effective and has a high probability of success.
2. When the VRS finds that self-employment is the customer’s only re-employment option, the VRS will talk to the customer about the:
   1. Risks, benefits, and costs of running a business, and
   2. Customer’s responsibilities in an IVP for self-employment.
3. The VRS will make purchases and get appropriate secondary approvals as required by:
   1. PRO 07/2012, Procurement Procedure.
   2. POL 05/2004, Vocational Rehabilitation – Equipment and Tools.

Business Plan/Feasibility Study

4. The VRS will approve the use of a business consultant to help the customer create a business plan and feasibility study. The customer must get pre-approval from the WCB before work begins on the plan.
5. The customer will ensure the business plan and feasibility study are completed in a professional and timely manner.
6. The business consultant will direct bill the WCB, not the customer.

Self-Employment Funding

7. The WCB will only approve business plans where the total value is $150,000 or less (including the cost of the business consultant). The WCB and the customer will each provide a contribution towards the total value of the plan.

8. The customer will pay for:
   1. Legal fees.
   2. Licensing.
   3. Liability insurance, and
   4. WCB business coverage.
9. The customer will also pay to register the business. The customer will ensure that their name is noted as a business owner/partner on the registration.
10. The WCB will release funds in trust to the customer’s lawyer according to the conditions noted in the IVP.

IVP for Self-Employment

11. The WCB will approve IVPs for self-employment in accordance with the approval limits noted in PRO 23/2016, Vocational Rehabilitation – Programs and Services. The WCB will only approve one IVP for self-employment.
12. The IVP for self-employment will include the following:
    1. Terms and conditions for self-employment.
    2. Expectations, risks and responsibilities of the customer and the WCB.
    3. Conditions for funding.
    4. The customer’s estimated earnings capacity (POL 01/2018, Benefits – Long-Term Earnings Loss).
    5. Earnings loss benefits payable.
    6. Business training programs that the customer will take part in.
    7. Requirements for tools, equipment, vehicles, inventory, property and buildings (POL 05/2004, Vocational Rehabilitation – Equipment and Tools).
    8. Eligibility for travel and sustenance expenses (POL 04/2021 Travel Expenses - General).
    9. The use of a business consultant to help the customer create a business plan and feasibility study.
13. The VRS will approve appropriate business training associated with managing the business.
14. If the IVP allows the customer to purchase tools, equipment, vehicles, inventory, property or buildings, the VRS will arrange for direct billing (PRO 07/2012, Procurement Procedure).

Evaluation Criteria

15. The VRS will evaluate the sustainability and cost effectiveness of the business. The VRS’s evaluation may include, but is not limited to, the following:
    1. A review of the business plan and feasibility study to see if
       1. There are market opportunities in the industry under consideration.
       2. The business is expected to have a three-year net positive value (based on cash-flow projections).
       3. The business has the potential to meet the customer’s pre-injury earnings.
       4. All costs (e.g., business training programs, purchase of personal and real property) are within the WCB’s funding limitations.
    2. A review of the customer’s prior business experience, related expertise or transferable skills to see if they are suitable for business ownership.
    3. Testing for business aptitude.
    4. Determining if the customer can handle the nature of the work, hours, travel and other requirements given the customer’s compensable and non-compensable medical restrictions. The customer must be able to control the day-to-day operations of the business.

Security Interest

16. The VRS, following discussion with Legal Services, will register a security interest with Information Services Corporation (ISC) for the purchase of:
    1. Personal property, or
    2. Real property.
17. The VRS will get a legal description of the real property from the customer or real estate agent prior to:
    1. Releasing funds for purchase, and
    2. Registering the security interest.
18. The VRS will note that a security interest is registered in the customer’s file.
19. The VRS will remove the security interest twelve months after the business becomes a viable operation.

Financial Reviews

20. The VRS will review the customer’s financial statements/ledgers within six months of the start of the business.
21. The VRS may speak to the business consultant that helped create the business plan and feasibility study.
22. If the customer continues to get WCB sponsorship, the VRS will review the customer’s financial statements/ledger’s every six months (or before then if necessary) until the business becomes a viable operation.

Determination of Long-Term Loss of Earnings

23. The VRS will monitor the actual earnings generated by the customer’s employment. Earnings loss benefits will end when:
    1. The customer’s estimated earning capacity exceeds earnings at the commencement of loss (Consumer Price Index adjusted to date), or
    2. The customer demonstrates the ability to generate actual earnings equal to or in excess of the earnings at the commencement of loss (Consumer Price Index adjusted to date) for a period of time sufficient to reasonably predict future earnings (typically two to four months).

POL 01/2018, Benefits – Long-Term Earnings Loss will apply.

24. If the business fails within six months because of factors within the control of the customer, the VRS will use the IVP for self-employment as the customer’s estimated earning capacity in order to determine ongoing entitlement.
25. If the business fails within six months because of factors that are not within the control of the customer (e.g., market conditions, increased productions costs, increased restrictions from the work injury, etc.), the VRS will do another employability assessment and transferable skills analysis (QuickNOC Pro). The VRS will not consider self-employment as an option for re-employment.
26. If the work injury recurs, the WCB will not reduce recurrent benefits by the amount the WCB gave towards the business. The customer will make arrangements for the continuation of the business.

Closure Report

27. The VRS will forward a Closure Report to the Customer Care Facilitator (CCF) at the completion of the IVP. The report must include a final estimation of the customer’s earnings capacity.