March 9, 2000

Mr. Peter Hopkins

WCB Ombudsman

Workers Compensation Board

6951 Westminster Hwy

Richmond, BC V7C 1C6

Dear Mr. Hopkins:

On behalf of the employers and employees of the hospitality industry, I am writing to request your investigation into serious misrepresentations by the Board that have the effect of insinuating that our industry is lying.

It is widely accepted that there are three kinds of lies: lies, damn lies and statistics. With each passing day it is becoming more obvious that the professional spin doctors who have been hired by the WCB to justify the unilateral smoking ban have an incredible knowledge of how to best employ misleading statistics to attain set goals.

Specifically, the WCB Communications Department has issued news releases, made comments and posted erroneous and misleading information on its website relating to job losses in the hospitality sector.

As you may be aware, since the ban began, our industry has been keeping a "census" of unemployed by requesting our members to report directly on layoffs that have resulted from the smoking ban. These layoffs are not, as the WCB Communications Department has stated "the result of a typically slow Winter season". Our managers are looking at their revenues, and comparing them from last year’s figures and noting in some cases, extreme drops in revenues - anywhere from 15% - 85%. Several bar owners have explained to me that they previously grossed $1,000 a day in sales, and are now doing $80. What is happening is that our previous smoking patrons are opting to pick up a six pack, going home or going to their hotel room, and socializing there instead.

Clearly, this is causing serious economic hardships and resulting in direct job losses.

According to the figures received from the 152 businesses that have reported as of this writing, 695 people are no longer working in our industry. Seventy (70%) of these people are women, many of them single moms.

The WCB Communications Department has published a set of gerrymandered statistics in an unbelievably ludicrous attempt to convince the people of British Columbia that there have been little, if any, job losses as a result of the Board's heavy handed anti-smoking regulation for bars, pubs and restaurants.

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The WCB Communications Department has used a baffling set of incomprehensible statistics provided to them by Human Resources Development Canada. To say that the Board stretched the limits of literary license (never mind statistical credibility) in its efforts would be to understate the case. The Board has twisted and distorted the data and stopped just short of calling industry representatives liars. Whether the Board did so out of sheer incompetence or malicious intent is not clear (if the Communications Department is willing to admit its incompetence at analyzing statistical data we are willing to give it the benefit of the doubt but until such an admission is forthcoming we will assume that this malfeasance was deliberate).

As Winston Churchill pointed out, "the first casualty in war is truth," and the Communications Department has now made it very clear that they will stop at nothing to triumph in their crusade against smokers. The spurious insinuations that industry representatives are drastically and dramatically fudging on the numbers of employees who have been laid off as a result of this draconian and odious regulation is proof that "the truth" has not been an innocent casualty of the WCB attacks. The Communications Department has methodically performed a clinical assassination on "the truth" and we have little doubt that they will continue to do so unless checked immediately.

We have received the same tables from HRDC that were used by the Board to develop their statistical tables. We have further researched this information with experts on HRDC policies and have been informed of the following:

• The tables are raw estimates generated from HRDC's Benefits and Overpayments file (BNOP). They are administrative information used in the administration of the EI program.

• They are not statistically reliable as indicators of labour market performance or behaviour -- nor are they used as such within HRDC.

• Specifically, the monthly estimates appearing in the several tables represent point-in-time estimates (mid-month); ie, they do not represent a monthly average, they do not measure labour market flows (when persons may have actually left their jobs), whether there is any bias as a result of having chosen the middle of the month for the monthly estimate, and the occupational coding has not been verified as to accuracy.

• Further, the estimates refer to 'work ready clients'. This reference is not one that is generally used -- it has, however, been in use in BC/Yukon since 1993. It is defined as: a population of claimants who are ready and able to work (excluding claims that are not active, and claimants on training, sickness, maternity and parental claims; skeleton incomplete files -- and benefit period not established (BPNE) files are excluded because of incomplete and uncertain information). Claimants who have established entitlement to benefits and are serving their 2 week waiting period are included (considered work ready).

• The proportion of the unemployed who are EI claimants (the beneficiary to unemployed ratio) may also affect the usefulness of the data.

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• It is generally accepted that EI claimants have fallen as a proportion of the number of unemployed persons in the labour market. This decline could suggest that estimates of EI claimants by occupation under-represent the available labour supply (because persons who believe that they don't qualify for benefits don't bother applying, yet they are available and likely looking for work).

• The majority of claimant information files do not include information on industrial sector, which explains why HRDC relies on Statistics Canada and Revenue Canada for its data on labour market trends.

With this information, we request that you investigate the Board’s use of these figures, issue a cease and desist order against the Communications Branch, and remove the erroneous figures from all existing Board communications.

The continued use of these statistics is an insult and an affront to the 695 workers who now find themselves unemployed because of this regulation

Thank you for your time and consideration of this serious matter and we look forward to your reply.

Sincerely,

Rick Boyd

President

BC & Yukon Hotels Association

c.c. Hon. Jane Stewart, Minister of Human Resources Development Canada

Hon. Ujjal Dosanjh, Premier of British Columbia

Hon. Ian Waddell, Minister of Small Businesses and Tourism

Hon. Joy MacPhail, Minister of Labour

Mr. Eric van Soeren, BC Job Protection Commissioner