Overview of the workplace safety and insurance system
Workplace safety and insurance is a no-fault insurance system for work-related injuries and diseases that is governed by the Workplace Safety and Insurance Act, 1997 (WSIA).
Who needs to register with the WSIB
If your business is providing construction services and you hire workers, including family members, or apprentices for your business you must register with the Workplace Safety and Insurance Board (WSIB) within 10 days of hiring your first worker. Likewise, if you acquire any or all of an existing construction business with employees, you must register with the WSIB within 10 days.
As of January 1, 2013, independent operators (IOs), sole proprietors, some partners in a partnership, and some executive officers who work in construction are also required to register and have coverage with the WSIB, and are deemed “workers” under the WSIA for this purpose. Private insurance is not an acceptable substitute. Where there are no other workers, the sole proprietors, partners, or corporations those individuals work for, or carry on business under, are deemed “employers” under the WSIA. In some cases, an individual will therefore be considered to be both an employer and a worker for the purposes of the WSIA.
Exempt from mandatory coverage are,
- home renovators who work exclusively in home renovation and are contracted directly by either the person occupying the residence or by a family member of that individual, and
- one executive officer or partner in a business, as long as that individual does not perform any construction work on any building site.
The latter exemption does not apply to executive officers of corporations that have only one executive officer and no employees. Individuals who operate their business on their own – either as sole proprietors who have no workers or as single officer corporations – must submit a status declaration confirming their status as an IO.
Your obligations regarding compulsory coverage and clearance certificates are set out in OPM Doc. Nos. 12-01-06, 14-02-04, 14-02-08, 14-02-19, and 22-01-10. All of these policies are available on the WSIB’s website. The WSIB has also posted two Administrative Practice Documents related to expanded compulsory coverage in construction on its website. These documents, which are supplementary to the actual WSIB policies, offer additional information and practical examples to further explain the application of the new law and policies. For more information, please refer to the WSIB’s needwsibcoverage.ca website.
Precautions when acquiring an existing business
If you acquire an existing business you will inherit the seller’s accident history and financial obligations, including any money owed to the WSIB. To protect yourself, you should get a purchase certificate from the WSIB. A purchase certificate is a document the WSIB will issue if the original employer’s account is in good standing, on the date the business is sold.
If a purchase certificate is issued, the WSIB will not hold the purchaser liable for any amounts charged to the original owner’s account, up to the date the business changed hands.
For audit purposes, purchasers must keep a copy of any purchase certificate received. Both the purchaser and the vendor are required to keep a copy of any purchase certificate issued directly to them by the WSIB.