WSIB to Overhaul Employer Premium Rate System

by | May 16, 2017 | For Employers

WSIB has held ongoing consultations with various stakeholders over the years regarding how it assesses employer premiums. Several concerns have emerged, including inconsistent classifications of employers and inconsistent premiums being assigned to similar employers.

Recently, the WSIB published its report on how it will modernize the Rate Framework for WSIB employees. This will take effect in 2019, which will hopefully see a much more streamlined system where employers are classified properly and pay the appropriate premiums that reflect their risk.

Here are some highlights of the report:

Key Changes

There will be a new classification system, where employers are sorted into 34 classes/subclasses. Further, employers will be classified based on the North American Industrial Classification System (NAICS) rather than the Standard Industrial Classification (SIC) system. The goal is to classify employers transparently and consistently predominantly based on business activity.

An employer’s classification is directly related to the premiums an employer has to pay. Premium rates for each new class will now be set based on the collective experience of the class, which takes into account expected future cost for the class, WSIB administrative expenses, and past claims cost.

The employer’s classification is not the final determination of its premiums. An employer’s individual experience will determine the premiums it will ultimately have to pay. The employer’s premiums will be determined by considering the employer’s insurable earnings, number of allowed claims, and actual claims costs.

What Employers Should Expect

The message is still the same to employers: manage and promote a safe work environment to keep WSIB premiums down. However, under the new system, employers should be able to clearly understand how the WSIB has arrived at the specific premiums that they have to pay.

WSIB will consider the claims from the past six years, especially the last three, when determining the employer’s individual premiums. Therefore, when this revised Rate Framework takes effect on January 1, 2019, employers should ensure that their history of claims is minimized to the best extent possible.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him directly at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.



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