Rate Framework: FAQs

Premium rate-setting

What factors will be used to determine premium rates under the new model?

In the new model, your rates will be calculated by considering three components:

  1. Insurable earnings
  2. Number of claims
  3. Claims costs

What years are considered when calculating my premium rate?

A rolling six-year period is used to calculate your premium rate. Specifically the six years prior to the rate-setting year. For example, in 2019, we will use the years 2013-2018 to determine your 2020 premium rate. During the course of that time, your insurable earnings, claims count and claims costs are the components reviewed and taken into consideration.

What are risk bands and how do they relate to premium rates?

In our new model, classes will have a set of risk bands, where each risk band represents a rate in relation to the class rate. A rate is assigned to each risk band, either above or below the class rate. The difference between each risk band rate is approximately five per cent. Depending on your claims experience, your business will be assigned to a risk band that best represents your risk in relation to your class. Your assigned risk band rate includes rate adjustments based on your individual experience.

Starting in 2023, our policies for premium rate-setting under the new model will be fully in effect. Generally, businesses with projected premium rate increases will see their rates increase up to a maximum of three risk bands per year, until they reach their projected premium rate. Businesses eligible for decreases will see their rates decrease up to three risk bands per year until they reach their projected premium rate.

How does predictability impact premium rates?

Your predictability is a measure of how much your past claims experience and insurable earnings can be used to predict future outcomes.

A low predictability means a business’ insurable earnings and the number of past claims is quite low. In this case, your claims experience would not have a significant impact on your rate. Instead, your premium rate will be more influenced by the rates of your class to protect against volatility and the dramatic effect one claim could have on your rate.

Businesses with a higher number of allowed claims, claims costs and larger insurable earnings, have a higher predictability. In this case, volatility is not as high, as each single claim likely will not have a significant impact on your rate.

What is a class rate?

The class rate represents the premium rate for a given class based on the collective risk profile for all the businesses within the class and your class’s shared responsibility to maintain the insurance fund.

Can a business be assigned the class rate?

We assign the class rate to new businesses. Your business is considered a new business if you have less than 11 months of experience available in the review period. Once a business has 11 months or more of experience in the review period, their following year’s premium rate will be set based on their past insurable earnings and claims experience. Businesses with experience similar to the class are also assigned the class rate.

What is a projected premium rate?

Your projected premium rate provides the future direction, up or down, that your premium rate is headed if there is no change in your individual and class experience from year-to-year.

What is starting point rate?

In the new model, each business will be assigned a starting point rate that reflects their claims experience and 2019 rate group rate. Our transition rules will be applied to the starting point rate a business receives in determining the 2020 premium rate that they will pay.

We will take into consideration whether or not your business was previously in an experience rating program, when calculating your starting point rate.

How will businesses transition to the new model?

To help you smoothly transition into our new model, any initial projected rate increases will be staggered over time and any rate decrease will be applied immediately.

Businesses with projected premium rate increases

In 2021, businesses with projected premium rate increases will move up a maximum of one risk band from their 2020 risk band.

In 2022, businesses that have not yet reached their projected premium rate will move up a maximum of two risk bands above their 2021 risk band.

Businesses with projected premium rate decreases

Any projected rate decreases have been applied to your 2020 rates. This will also happen in 2021 and 2022.

Starting in 2023, our premium rate setting policies under the new model will be fully in effect. Businesses with projected premium rate increases or decreases will see their rates move up or down a maximum of three risk bands each year until they reach their projected premium rate, protecting them from any sudden changes to their premium rates.

Can I get a detailed breakdown of how my 2020 premium rate was set?

You can request an extended statement that will provide you with details on how your individual premium rate was calculated, the adjustments made based on your claims experience and a breakdown of your claims costs.

To request an extended statement:

How will lost time and no-lost time claims impact premium rates?

When determining your premium rate, we will assess three components: insurable earnings, number of claims, and claim costs. All allowed claims, both lost time and no-lost time injuries, will be used to calculate premium rates. Lost time claims typically have higher claims costs and may increase premium rates accordingly.

My business is currently ineligible for a potential rate adjustment, what does this mean and how do I become compliant?

Your business is ineligible for a potential rate adjustment as payroll reporting has not been received for one or more years in the review period (2013-2018). As a result, provisional insurable earnings has been applied to those years.

To become compliant and eligible for a rate recalculation and potential rate adjustment, please contact us at 1-800-387-0750 or employeraccounts@wsib.on.ca.

Once your account has been reconciled and you are compliant, we will help you smoothly transition into our new model by staggering any initial projected rate increases over time. Any projected rate decreases will be applied to your rates.

What are provisional insurable earnings?

Provisional insurable earnings are an estimate of a business’s insurable earnings, when a business has not reported their payroll in more than one period in the preceding year, and the account has not been reconciled at the time of rate calculation.

If the transition rules state that any initial rate increase will be staggered over time, why is my starting point rate higher than my 2019 rate?

Your businesses starting point rate could be higher than your 2019 rate if, you have experienced a NEER or CAD7 surcharge or a MAP increase during calendar years 2016 to 2018.

I received my premium rate summary statement and do not agree with the rate, how can I appeal?

Your premium rate cannot be appealed, however, you can appeal any of the following components by providing supporting documentation that shows:

  • Your insurable earnings are inaccurate for 2016 through 2018
  • A claim(s) that occurred between 2013 to 2018 should not have been applied to your account
  • Your claims costs are incorrect from 2013 to 2018

What is transition funding and is it included in my rate?

To help businesses smoothly transition into our new model, any initial projected rate increases will be staggered over time and rate decreases have been applied to 2020 rates. As part of this transition period, a rate adjustment has been applied to eligible businesses’ rates representing the portion of their premium rate needed to ensure a smooth transition for all businesses.

Transition funding adjustments are applied after a business’s rate has been determined based on their 2019 rate group rate, claims experience, the size of their business, new NAICS classification, projected rate increases or decreases and whether or not they were in an experience rating program previously.

Transition funding adjustments will only be applied during the transition period and will come to an end in 2023, when our premium rate setting policies are fully in effect.

Is there a flat fee for transition funding that all businesses will pay?

The transition funding adjustment is not a flat fee for all businesses. The adjustment applied to an eligible business’s rate represents the portion of their premium rate needed to ensure a smooth transition to our new model for all businesses.

Temporary Employment Agencies

How will Temporary Employment Agencies (TEAs) be classified under the new NAICS classification structure?

TEAs will be classified under NAICS code 561320 (Temporary Help Services) for the business activity of supplying labour and you will report your office staff’s insurable earnings under this classification. Each class you supply labour to will also be added to your account, based on the reporting class information you provide to the WSIB.

How will TEAs transition to the new model?

To help you adjust to the new reporting obligations and administration under the new premium rate-setting model, we have implemented a one-year transition approach.

To determine the 2020 rates TEAs pay, we have compared your assigned starting point rate to the class rate of each of the NAICS classes you supply labour to. In 2020, if your starting point rate is equal to or higher than the class rate in a class you supply labour to, you will pay the class rate. You will pay your starting point rate if it is lower than the class rate.

Beginning in 2021, you will be assigned the class rate for each of the NAICS classes to which you supply labour, meaning the rates you pay will be more reflective of your clients' actual business and the associated risk.

For more information on the starting point rate, visit our understanding your 2020 premium rate page.

What are TEAs reporting obligations under the new model?

You need to segregate your earnings for each class you supply labour to and for your operations classified in NAICS 561320. If a temporary employee is going to different clients/industries each day, TEAs will need to segregate that person's earnings between all classes to which they are being supplied.

You also need to report on all of the classes to which you supply labour to ensure the right reporting classes are added to your account. If you add or remove a class to which you supply labour, you will need to provide supporting information to us to confirm a change has occurred, such as a client employer list with legal names and addresses. Further documentation may be requested if there is insufficient or incomplete information.

How can I determine my client employers’ premium rate setting classes?

Download our Businesses Classification Details data to search for your client employers' 2020 classifications. You will need the exact legal names of your client employers in order to find them on the spreadsheet. The data reflects all businesses registered with the WSIB as of April 30, 2019.

If you cannot find classification details for any of your client employers, it may be because they are not required to register with us, or may have registered after April 30, 2019. You can contact our dedicated TEA team to help determine your client employers' classification details by calling us at 1-800-387-0750, and then pressing two from our menu options.

Prior to calling, please have the list of client employers you were unable to locate with their full legal names, addresses and phone numbers.

Who are clients?

Clients are the businesses that TEAs supply labour to on a temporary basis for a fee.

Are TEAs required to provide coverage for the labour they supply to businesses not registered with the WSIB?

Yes, TEAs are required to provide coverage for all the labour they supply to clients, whether they are Schedule 1, Schedule 2 or non-mandatory business activities. 

Do rules of association apply to TEAs?

Yes, the rules of association apply if a TEA supplies staff to an affiliated business. You are considered to be in a cooperative business relationship for the portion of labour you supply to the affiliated business. 

Construction

In the new model, will there be a class similar to the current rate group 755?

In our new model, non-exempt partners and executive officers in construction, who were previously classified under rate group 755, will continue to receive a separate premium rate that reflects the low risk of their work in comparison to the rest of the construction industry.

How is the non-exempt partners and executive officers premium rate calculated?

The 2020 premium rate for non – exempt partners and executive officers in construction is based on the 2019 rate group 755 rate. Moving forward, your premium rate will be based on the collective experience of all non-exempt partners and executive officers in construction. You will gradually move towards a projected rate that is based on that collective experience.

I received my premium rate summary statement and my account was assigned to class G1- Building construction. Why does my classification differ from my business activity?

Your premium rate statement shows your business activity as class G1 to reflect your classification as non-exempt partners and executive officers in construction. In our new model, non-exempt partners and executive officers in construction were previously classified under rate group 755. They will continue to receive a separate premium rate that reflects the low risk of their work in comparison to the rest of the construction industry.

Prior to the new premium rate-setting model, my business activity was not classified as construction, why has my business activity been reclassified in construction?

Your business has been reclassified as a construction business activity based on the North American Industry Classification System (NAICS). NAICS is a more modern classification system that reflects the changes in industry composition and new industries that have come into existence.

Associated Employers

What is the criteria for considering two or more businesses associated?

Two or more businesses will be considered associated if they meet the combined experience outlined under both the Test of Affiliation and Test of Cooperation.

For more information, view the Associated Employers policy.

If family members operate businesses that are separate and distinct from one another, are they considered associated?

If two or more businesses meet both the tests of affiliation and cooperation, they are considered associated. Just being affiliated with another business does not necessarily mean that the two businesses are associated.

When considering the test of Affiliation, what is the definition of ‘control’ in the case of a corporation?

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.

If I close and then re-open my business, will the WSIB transfer the insurable earnings and claims experience to my re-opened business?

Yes, if a business closes and re-opens within 12-months of the closure, the transfer of experience will occur even if the business registers the business under a new name, produces new articles of incorporation, or obtains a new WSIB account number.

The transfer of experience will occur if the reopened business 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.

Non–profit organization

What is a non-profit organization?

Non-profit organizations are associations, clubs, or societies that are not charities and are organized and operated exclusively for social welfare, civic improvement, pleasure, recreation, or any other purpose except profit.

Registered charities are charitable organizations, public foundations, or private foundations that are created and resident in Canada. They must use their resources for charitable activities and have charitable purposes that fall into one or more of the following categories:

  • the relief of poverty
  • the advancement of education
  • the advancement of religion
  • other purposes that benefit the community

How will a non-profit organization transition to the new model?

Non-profit organizations will be a part of an extended transition into the new model.

During the next five years, any rate decrease will be applied to your account and your rate will be capped at or below your 2020 rate.

Projected premium rates, which provide the future direction that your premium rate is headed – down or up – based on your individual and class experience from year-to-year, will not be reflected in your account during this period.

Retroactive rate adjustments

My business activities have changed. Can retroactive adjustments be made to my rate to reflect these changes?

If you have added, changed or deleted any business activities, or if you now meet the criteria for multiple premium rates, you may be eligible for a retroactive rate recalculation.

Adjustments can be made to your rate dating back to January 1 of the current year (or the year in which you notified us of the change).

What other changes can be made to my account resulting in a retroactive rate recalculation? How many years back can these retroactive adjustments be made?

You may be eligible for a rate recalculation if any of the following changes have been applied to your account retroactively. Adjustments can be made to your account dating back to January 1, up to three years prior to the current year.

Changes to account leading to debit or credit adjustments to your premium rate:

  • interest charges are applied to your account
  • a change in insurable earnings, including insurable earnings transfers from one business to another
  • there is a change in your predominant class, including any predominant class changes resulting from a change in insurable earnings
  • change in associated employer status
  • non-compliance penalties
  • status decisions for executive officers and contractors
  • optional insurance
  • claim count and/or claim costs due to a WSIB error
  • earnings of non-registered businesses
  • transfer of costs

Changes to account leading to debit adjustments to your premium rate:

  • you previously provided incomplete or inaccurate information to the WSIB, or failed to act on information provided by the WSIB that directly affects your premium rate
  • you declared your business to be exempt from compulsory coverage in construction under 'home renovation work' or claimed a 'partner or executive officer exemption' while performing construction work that is not eligible for the exemption

Changes to account leading to credit adjustments to your premium rate:

  • Secondary Injury Enhancement Fund (SIEF) relief
  • accident date changes
  • claim amalgamation
  • reversal of entitlement to a claim

What is the notification date?

For the WSIB’s audit area, the notification date for a rate adjustment is the date of the audit visit, or the due date indicated on the Notice of Audit.

For the WSIB’s other operating areas, the notification date for a rate adjustment is the receipt date of a request from a business, a business representative with valid authorization, or the date of a site visit documented in the business’s file.

Are there any other situations that may lead to retroactive rate adjustments?

In cases of court judgments and provisional premiums, debit or credit adjustments may be made in any prior year.

Debit adjustments may also be made in any prior year where non-compliance under the Workplace Safety and Insurance Act has been found (this includes claims reporting obligations and claims suppression).

Businesses who provide inaccurate or incomplete information and who have been identified as the result of the following may also have retroactive adjustments made to their account(s) in any prior year:

  • the WSIB's information exchange agreements with the Canada Revenue Agency or other authorities or administrations
  • Stakeholder Compliance Services referrals
  • audit notifications and discoveries
  • Action Line referrals (anonymous telephone calls)
  • revenue recovery activities
  • decisions resulting from worker status reviews, or any other means of identification

For additional details on retroactive adjustments, see Policy 14-02-06 Employer Premium Adjustments.