ERCB Persistent Noncompliance Framework

As part of the ERCB compliance strategy, ERCB groups will monitor industry compliance performance to identify licensees (or the responsible duty holder, as defined in legislation) that have an unacceptable rate, ratio, percentage, or number of noncompliances in either the same or different compliance categories. Licensees identified as persistently noncompliant will be required to develop strategies to improve their compliance performance.

Failure to improve compliance performance can result in additional enforcement actions.

The Persistent Noncompliance Framework provides guidance to ERCB groups to ensure a fair, transparent, and level playing field. Within the framework, ERCB groups will be required to clearly indicate the criteria for initiating early intervention activities and determining persistence.

Any questions/comments regarding the ERCB Persistent Noncompliance Framework should be directed to ComplianceCoordination@ercb.ca. Any questions/comments regarding the persistent criteria for a specific Compliance Category should be directed to the respective ERCB group.  Feedback that is provided may influence updates to the persistence criteria for the following year.  A link to the compliance category contact list is provided in the ERCB Persistent Noncompliance Criteria list by clicking on the Branch name.  

ERCB Persistent Noncompliance Framework

By December 1 of each year, ERCB groups are responsible for publishing any changes to the Persistent Noncompliance Criteria by Compliance Category. The criteria will be in effect for the following year.

2012 Persistent Noncompliance Criteria - updated December 2011 for 2012

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ERCB Persistent Noncompliance Framework (in accordance with Directive 019 : ERCB Compliance Assurance Enforcement)

Introduction

• Each ERCB group will use the following framework to determine whether a licensee is persistently noncompliant.
• Each group will track surveillance activities by compliance category. Items to be captured will include the total number of inspections/audits/investigations conducted and their results.
• If after management review, a licensee defined as persistent is not subject to persistent consequences, the decision and rationale must be recorded and maintained on file by the ERCB group.

Definitions

• Persistent noncompliance an unacceptable rate, ratio, percentage or number of noncompliances by a licensee, either in the same or in different compliance categories.
   Licensee noncompliance rate the total number of noncompliances divided by the total number of conducted ERCB inspections/audits/investigations on that licensee within a compliance category.
• Licensee status for the purposes of determining High Risk persistence, "low" means the number of noncompliances or a threshold at which the ERCB may intervene, "monitor" means the level at which the ERCB will intervene, and "persistent" is the level at which the ERCB will intervene and take High Risk Enforcement Action 2.
• Noncompliance threshold for the purpose of High Risk persistence Option 2, the percentage of noncompliances found during an inspection/audit/investigation above which a licensee will be determined to be at low, monitor, or persistent status.
• Industry average rate the total number of industry noncompliances divided by the total number of conducted ERCB inspections/audits/investigations on industry within a compliance category.

Low Risk

• Within each compliance category, surveillance activity results must provide the ability to compare individual licensee noncompliance rates with industry average rates to assist in the determination of Low Risk persistent noncompliance.
• At the conclusion of each calendar year, or at a predetermined period as determined by the ERCB group, the ERCB group will generate a report that identifies licensees whose noncompliance rate exceeds the industry average rate.
• The five to ten licensees with the greatest exceedance of the industry average rate are defined as persistently noncompliant for Low Risk and are subject to the requirements of Directive 019, Section 4.1: Low Risk Review. The number of licensees identified is determined by the ERCB group.

High Risk

By December 1 of each year, ERCB groups will publish on the ERCB Web site the Persistent Noncompliance Criteria by Compliance Category (hyperlink). This will include the licensee status criteria for Persistence, Monitor, and Low.

Option 1: Number of Noncompliances

• Review period will be a 90-day rolling window (ongoing) or a period predetermined by the ERCB group.
• For the review period, each ERCB group will generate a report outlining the number of High Risk noncompliances in each compliance category experienced by each licensee. The number of noncompliances during the review period will determine the ERCB response in relation to the Number of Noncompliances column below.
• Upon being designated as persistent, a licensee must operate in compliance for 60 days or a predetermined period of time from the date of the ERCB accepting the High Risk Enforcement Action 2 action plan (see Directive 019) to return to a satisfactory compliance rating. If a licensee fails to operate in compliance during this time frame, High Risk Action 2 (Persistence Noncompliance) will be repeated and a licensee may be subject to additional enforcement consequences, as outlined in Directive 019.

The example below is for representative purposes only; exact noncompliance numbers are to be determined for each compliance category by the respective ERCB group.

		Determined by ERCB Group
Licensee Status	EUB Action	Number of Noncompliances	Review Period	Operate in Compliance
Persistent	High Risk Noncompliance Action 2 and must intervene and educate	≥3	90-day or predetermined rolling window	60 days or predetermined period
Monitor	Mustintervene and educate intervene and educate	2
Low	Mayintervene and educate intervene and educate	1

Option 2: Noncompliance Threshold

• Review period is annual or a predetermined review point, as determined by the ERCB group, of a licensee's activities within a compliance category.
• Licensees whose inspection/audit/investigation results indicate noncompliance equal to or greater than the Noncompliance Threshold are defined as persistent and may be subject to enforcement consequences, as outlined in Directive 019.
• Licensees that fail to improve their performance (i.e., their noncompliance rate is equal to or greater than the Noncompliance Threshold) after a subsequent review period will be subject to repeat High Risk Action 2 and may be subject to additional enforcement consequences, as outlined in Directive 019.

The example below is for representative purposes only; exact thresholds are to be determined for each compliance category by the respective ERCB group.

		Determined by ERCB Group
Licensee Status	ERCB Action	Noncompliance Threshold	Review Period	Operate in Compliance
Persistent	High Risk Noncompliance Action 2 and must intervene and educate	≥10%	Annual or predetermined review point	60 days or predetermined period
Monitor	Mustintervene and educate intervene and educate	8 to 9.99%
Low	Mayintervene and educate intervene and educate	7 to 8.99%