Associated Employers

Policy

The WSIB combines the insurable earnings and claims experience of associated employers for the purposes of classification and prospective premium rate setting.

Purpose

The purpose of this policy is:

  • to outline when the WSIB will consider two or more employers associated, and 
  • to promote health and safety in workplaces by allowing for the transfer of employers’ experience in limited circumstances.

Guidelines

Combining experience

If two or more employers meet both the below-noted tests of affiliation and cooperation, they are considered associated under this policy. Associated employers’ entire operations are combined for the purposes of classification and premium rate setting.

An employer may not belong to more than one association.

1) Test of affiliation

Two or more employers are affiliated if any of the following criteria apply:

Family members

They are individuals who are related to each other as any of the following:

  1. spouses (as defined in Part III of the Family Law Act),
  2. parents and children
  3. grandparents and grandchildren
  4. father-in-law or mother-in-law, and son and/or daughter in-law
  5. sibling or a spouse’s sibling, or
  6. a step or half relationship corresponding to one mentioned in clause b), c), d) or e).

Corporations

One employer is a corporation and another employer is:

  • a person who controls the corporation, or
  • a member of a related group that controls the corporation, or
  • an individual who is related to a person who controls the corporation, or to an individual who is related to a member of a related group that controls the corporation, or
  • a partnership that controls the corporation, or
  • the employers are both corporations, and
    • the corporations are controlled by the same person or group of persons, or
    • the corporations are controlled by individuals who are related to each other, or
    • one corporation is controlled by an individual who is related to a member of a related group that controls the other corporation, or
    • the corporations are controlled by related groups and a member of one of the related groups is related to a member of the other related group.

Partnerships

The employers are two or more partnerships, and there are persons who are general or limited partners of the partnerships and those persons are entitled to at least an equal share of the profits of each partnership.

For the purposes of this policy:

  • A person, group of persons, or partnership controls a corporation if enough voting shares in relation to the holdings of other shareholders are held by or for the benefit of the person, group of persons or partnership, in order to elect a relative majority of the board of directors.
  • A related group is a group of individuals each of whom is related to all the other members of the group.

An employer is affiliated with other employers that are affiliated with each other if the employer is affiliated with any one of the other affiliated employers.

2) Test of cooperation

Two or more affiliated employers are engaging in a cooperative business relationship if at least one of the following criteria is met:

  • The operation of one employer is primarily ancillary to the operation of the other if both operations were carried out by a single employer. For a description of ancillary operations, see 14-01-01, The Classification Structure.
  • The employers’ business activities primarily form an integrated operation. For a definition of integrated operation, see 14-01-07, Single and Multiple Premium Rates.
  • If one of the employers is a temporary employment agency (TEA) and it supplies workers to any employer to whom they are affiliated. The TEA is only considered to be in a cooperative business relationship for the portion of labour they supply to an employer to whom they are affiliated.

Transferring experience

If an employer closes and then re-opens a business within a 12-month period, the WSIB will transfer the insurable earnings and claims experience to the re-opened employer.

The transfer of experience will occur if the reopened employer substantially retains the same of any two of the following:

  • employees
  • clients
  • suppliers
  • business processes and equipment
  • health, safety and disability management programs, and
  • management team.

Under this section, the transfer of experience will occur regardless of whether the employer registers the business under a new name, produces new articles of incorporation, or obtains a new WSIB account number.

For more information on how experience transfers, see 14-02-05, Closures.

Application date

This policy applies to all decisions made on or after January 1, 2020.

Policy review schedule

This policy will be reviewed within five years of the application date.

Document history

This document replaces 14-01-06 dated March 3, 2008.

This document was previously published as:
14-01-06, dated October 12, 2004.
08-03-12 dated October 22, 2001.

References

Legislative authority

Workplace Safety and Insurance Act, 1997, as amended
Sections 12.2, 75(3), 77, 80, 81, 82, 83, 88 118(2)1, 135

Minute

Administrative
#5, June 1, 2018, Page 560