Workplace Safety and Insurance Board (WSIB) premiums
The WSIB maintains an insurance fund that is made up of annual premiums paid by employers. An employer’s premium payments are based on the WSIB’s classification of the employer’s business activity (which determines the premium rate) and the employer’s total insurable payroll. The annual premium paid by an employer is equal to its annual insurable earnings (payroll costs), multiplied by the premium rate, and divided by 100.
Annual Insurable Earnings x Premium Rate
______________________________________________ = Premium
Each fall, the WSIB sets the premium rate for each rate group, and announces the maximum insurable amount of workers’ earnings, for the following calendar year. Employers pay premiums only up to the insurable amount.
The WSIB has provided an “Insurable earnings and premium estimator” for the construction industry on its website to enable individuals to get a general idea about how much they may owe in premiums.
Premiums for Non-Exempt Partners and Executive Officers in Construction
Insurable earnings of executive officers include employment income reported to the Canada Revenue Agency (CRA) on Forms T4, T4A, T5, and director fees. Non-exempt partners and executive officers who do not perform construction work may qualify for a reduced premium rate. Applicants for this rate need to complete and submit the “Request for Rate Group 755, Non-Exempt Partners and Executive Officers in Construction” Form 1209WA in order to be considered.
Premiums for Independent Operators (IOs)
IOs in the construction industry who are engaged in both commercial work and home renovations must report all construction earnings to the WSIB as insurable earnings.
For IOs, insurable earnings will be calculated in one of three ways:
- If the business records, invoices, or written contracts accurately identify the labour portion of the contract, the WSIB considers the labour portion to be the IO’s gross insurable earnings.
- If the business records do not accurately identify the labour portion of the contract and there is no evidence that the contractor provided major materials and/or heavy construction equipment, the WSIB considers 100% of the value of the contract to be the IO’s gross insurable earnings for reporting purposes.
- If the business records do not accurately identify the labour portion of the contract and it can be shown that the IO supplied major materials and/or heavy construction equipment, the WSIB will allow the principal to identify the labour portion of the contract as follows.
- If the IO provides labour and major materials, the IO reports 60% of the contract value as gross insurable earnings.
- If the IO provides labour and heavy construction equipment, either with or without major materials, the IO reports 33 1/3% of the contract value as gross insurable earnings.