Glossary for reconciliation

Anyone you employ in your business for whom you set:

• the nature and place of work
• when it is performed, and
• how it is performed

Employees can be employed either full-time or part-time, including:

• seasonal, temporary or occasional employees
• students, apprentices and learners
• training participants
• domestic workers working for you for more than 24 hours a week

For information on training participants and domestic workers review our policy on Coverage for Unpaid Trainees or Domestic Workers.

An occasional (or casual) employee is a person who is employed by you on an occasional basis (i.e., less than part-time, and works on an irregular schedule). If this person is employed for the purposes of your industry, then you must report insurable earnings and pay premiums for the work performed. However, if this person is employed for purposes unrelated to your industry, then there is no need to report insurable earnings or remit premiums for the work performed.

For example, if a restaurant operator hires an additional cook during busy periods in the year, the insurable earnings of this employee must be reported and premiums paid for the work performed.

If the same restaurant operator hires a different employee to clear snow around the building on a less than part-time basis during the year, they aren't required to report the earnings of this person to us.

A family member, including spouse, children and other relatives, receiving earnings are considered employees. Their earnings must be included in your premium calculation.

We consider executive officers to be the individual(s) who control the direction of the organization and are empowered or appointed to act as an officer of the organization. We determine who is an executive officer for our purposes. Title alone does not make an individual an executive officer.

To determine if one (or more) of the individuals on your payroll is an executive officer, we consider a number of factors, including if they:

• hold a position (as corporate officer or director) and is named in your corporation's minute book as holding this position
• is enumerated, appointed or empowered through corporate documents such as Articles of Incorporation, Charters, by-laws, and/or Corporation Profile Reports filed with a federal or provincial agency to act as an officer
• does, in fact, perform the duties and executes the responsibilities of an executive officer, as defined by us, and
• has significant functional responsibilities demonstrating the individual is a 'directing mind' and/or is wholly or partially responsible for the organization as a whole

Executive officers aren't automatically covered under the Workplace Safety and Insurance Act, 1997 (WSIA) unless they are engaged in non-exempt construction work or apply for optional insurance. Review our Expanded Compulsory Coverage in Construction policy for details.

Learn more about who can obtain optional insurance and review a complete description of who qualifies as an executive officer.

An individual in construction who has an exemption under the Expanded Compulsory Coverage in Construction policy may apply for optional insurance.

If you're a contractor/subcontractor or owner-operator and we confirm that you're considered to be an employee, you're automatically covered.

If you're a contractor/subcontractor or owner-operator and we confirm that you're considered to be an independent operator, then you're not required to have insurance coverage with us (unless you're in the construction industry).

If you're a contractor/subcontractor or owner-operator and you have employees or helpers, then you must register with us. If you retain a contractor/subcontractor to perform a service and there is evidence that the contractor/subcontractor hires help, you should verify that the contractor/subcontractor working for you is registered with us and remains in good standing by requesting a clearance.

For the period being reconciled, if you retained contractors and did not obtain rulings from us confirming independent operator status for these individuals, or didn't obtain a clearance for those contractors/subcontractors who employ help or have optional insurance, we strongly encourage you to do so.

If we find these contractors/subcontractors were your employees and they haven't registered employers or are registered but aren’t up-to-date on payment and reporting, you could be liable for premiums that are owed in connection with the work or service they performed on your behalf.

In the construction industry, if independent operators, sole proprietors, partners in a partnership, and executive officers of a corporation are “deemed workers,” you must report their insurable earnings unless they are exclusively performing exempted home renovation work or they are a partner or executive officer to whom we granted an exemption from compulsory coverage.

For more information on “deemed workers,” review our policy on Expanded Compulsory Coverage in Construction.

When a principal hires an individual contractor to provide construction work and they aren't an independent operator in construction, the principal is their employer.

If you're a contractor/subcontractor or owner operator and we confirm that you're considered to be an employee, you're automatically covered.

If you're a contractor/subcontractor or owner operator and we confirm that you're considered to be an independent operator, then you're not required to have insurance coverage with us (unless you're in the construction industry).

If you're a contractor/subcontractor or owner operator and you have employees or helpers, then you must register with us. If you retain a contractor/subcontractor to perform a service and there is evidence that the contractor/subcontractor hires help, you should verify that the contractor/subcontractor working for you is registered with us and remains in good standing by requesting a clearance.

For the period being reconciled, if you retained contractors and did not obtain rulings from us confirming independent operator status for these individuals, or didn't obtain a clearance for those contractors/subcontractors who employ help or have optional insurance, we strongly encourage you to do so.

If we find these contractors/subcontractors were your employees and they haven't registered employers, or are registered but aren’t up-to-date on payment and reporting, you could be liable for premiums that are owed in connection with the work or service they performed on your behalf.

Insurable gross earnings include an employee's total gross earnings for the calendar year before any deductions. Total gross earnings include pay and other compensation that can be estimated in terms of money.

Gross earnings include:

• wages (hourly, daily, etc.), annual salary, and payment for piecework. These are usually reported on pay stubs and on T4 slips and include any amounts reported on a T4 as deductions, including, but not limited to:
  • income tax
  • Employment Insurance (EI)
  • Canada Pension Plan (CPP)
  • loss or use of equipment or tools
  • union dues
  • gratuities (tips, verifiable by the employer)
• allowances for car, clothing, moving, tools, and travel that are reported as taxable benefits and are included in income
• bonuses, incentives, taxable awards, prizes, taxable gifts
• director fees : if the director is an employee of the company, the amount of fee is added to the regular pay period's earnings

Review our Determining Insurable Earnings policy for a complete list of insurable gross earnings and non-insurable gross earnings.

These include:

• gratuities: tips paid directly to the employee by the customer being served
• maternity benefits paid by the employer
• severance pay as required under the Employment Standards Act, 2000
• sick benefits paid to an employee directly by a private insurance company

Review our policies for a complete list of insurable gross earnings and non-insurable gross earnings:

• Determining Insurable Earnings
• Insurable Earnings – Construction

The insurable earnings are each person's annual self-employment business income (subject to the annual maximum amount of insurable earnings). The annual self-employment business income is the amount reported to the Canada Revenue Agency as net business income (Line 135) on their Income Tax and Benefit Return (T1 General). In the case of a partnership, each partner's share of the total business income is reflected in their own T1 General or T2125 Statement of Business or Professional Activities.

The insurable earnings submitted to us must be an accurate reflection of your annual net business income.

The insurable gross earnings of an executive officer is based on the total of:

• employment income reported on a T4 Statement of Remuneration Paid
• other insurable employment income reported on a T4A, Statement of Pension, Retirement, Annuity, and Other Income
• dividends reported on a T5 Statement of Investment Income
• director fees issued by the corporation to the executive officer

A partnership or corporation in construction may report the insurable earnings of non-exempt partners or non-exempt executive officers who don't perform any construction work. Review the

The insurable gross earnings for independent operators in construction are based on the labour portion of the contract for work performed during the reconciliation period.

If you contract work to a contractor/subcontractor who we've determined, for the purposes of WSIB coverage, is your employee (worker), their insurable gross earnings must be part of your premium calculation.

The insurable gross earnings for contractors/subcontractors are based on the labour portion of the contract for work performed during the reporting period.

If a contractor's/subcontractor's service (e.g. construction, transportation or any other kind of activity) involves only labour, without money spent by the contractor/subcontractor on materials, equipment and/or installation supplies, then the total price of the contract is treated as insurable gross earnings.

The simplest way to determine the labour portion of the contract is for the contractor/ subcontractor to keep adequate records of all expenses on materials or equipment. Once these acceptable expenses are deducted from the total contract price, the remainder is the labour portion of the contract. Apply the annual maximum insurable earnings ceiling to eliminate any possible excess earnings.

Business records, contractor's invoices or written contracts that accurately identify the actual labour portions of the contract are treated as the contractor's gross earnings by identifying the amounts allocated and billed for labour and for materials, equipment and/or installation supplies. The labour portion is treated as the contractor’s gross insurable earnings.

We consider records adequate if they can show separate amounts paid for labour from materials, equipment and/or installation supplies and can be verified.

If your records don't accurately verify the labour portion of the contract, we consider these records inadequate and we consider the entire contract value to be gross insurable earnings.

Review our policy on Determining Insurable Earnings for more information on major materials and heavy equipment.

If your records are inadequate and you're in the landscaping, logging, construction, or the transportation industry, we use different contract values. For details, please see the following policies:

• Determining Insurable Earnings - Landscaping
• Insurable Earnings - Logging
• Insurable Earnings - Construction
• Insurable Earnings - Drivers in the Transportation Industry

Earnings records confirm the total gross earnings of your employees for the calendar year. Records should include:

• names of your employees and positions
• earnings, hours and days they were paid
• dates on which they were employed

Keep business records, including written contracts and contractors'/subcontractors' invoices that show:

• dates worked, days and hours paid
• amounts earned
• amounts paid for labour and costs of material/equipment supplied by the contractor/subcontractor

Businesses pay premiums on gross insurable earnings up to the maximum insurable earnings set for the year. Any earnings above this limit are not subject to WSIB premiums. Excess earnings for an employee are any earnings above the annual maximum insurable earnings.

For 2023, the maximum insurable earnings ceiling is $110,000.

For the 2023 year-end reconciliation, use the 2023 annual maximum insurable earnings ceiling.

If you're closing an account in 2024, the 2024 annual insurable earnings maximum is $112,500.

Example:

• If person one’s 2023 gross earnings are $115,000, their gross earnings are above the WSIB 2023 maximum insurable earnings, so they only pay premiums on the WSIB maximum insurable earnings ($110,000)
• If person two’s 2023 gross earnings are $86,000, their gross earnings are below the 2023 annual maximum insurable earnings, so they pay on their total gross earnings

If a person works for more than one business during the year, the annual maximum insurable earnings applies to the insurable gross earnings with each employer. You aren't responsible for tracking an employee's earnings with other employers.

NAICS codes are assigned to your account based on your business activity(ies), and insurable earnings are reported under the NAICS code(s).

For accounts with only one NAICS code, all earnings are direct earnings and will be reported under the one NAICS code.

NAICS codes are assigned to your account based on your business activity(ies), and insurable earnings are reported under the NAICS code(s).

We may assign more than one NAICS code to your account. This happens if you:

• have two or more distinct business activities listed in different NAICS codes, and
• keep properly segregated earnings records for each NAICS code

If the NAICS codes are in different classes/subclasses, then we'll assign the appropriate premium rate for each activity.

Direct earnings are earnings that can be assigned to a NAICS code directly from records that clearly show the earnings by business activity.

There are two types of direct earnings:

• those that relate only to the business activity of the NAICS code
• those from ancillary operations or optional insurance amounts that can be directly assigned to a NAICS code

If you have optional insurance, and no employees, your optional insurance amount is considered direct earnings.

If a NAICS code pre-printed on your reconciliation form has no direct earnings, contact us for assistance.

If you have more than one NAICS code, common earnings are any earnings from ancillary operations or optional insurance amounts that cannot be directly assigned to a single NAICS code and cannot be supported by segregated earnings records. These are called common ancillary earnings as they support more than one business activity and must be assigned to the relevant NAICS codes on a prorated basis. Learn more about assigning common earnings.

An ancillary operation supports one or more business activity but is not itself classified separately. This includes administration related to the employer's business activity, such as administrative staff, payroll and human resources.

Learn more about assigning common earnings if you have earnings, including optional insurance, that you cannot assign directly to a NAICS code.

Review our policy on The Classification Structure for more information.