Contractor and sub-contractor - A person or business entity providing contractual services to a principal. The business relationship between a principal and a contractor includes the relationship between a contractor the principal in this relationship and a sub-contractor the contractor in this relationship.
Therefore, the term "contractor" includes sub-contractor in this policy. The term "earnings" relates to the individual worker; whereas, the term "payroll" is the total earnings of all workers reported by the employer. Earnings are the total employment earnings of a worker from any source, which are capable of being estimated in terms of money.
There are two kinds of earnings, insurable and non-insurable. Only insurable earnings, subject to the maximum insurable earnings set each year, are included in the premium calculation.
Insurable earnings for premium calculation purposes are not always the same as average earnings for benefit purposes, see , Determining Short-Term Average Earnings. Section 25 1 employer contributions for employment benefits on behalf of injured workers are not considered earnings, and are not included in the calculation of premiums.
In industries other than construction, sole proprietors, independent operators, partners, and executive officers of corporations, as accepted by the WSIB, are not considered workers, are not insured by the WSIB, and their earnings are not included in insurable earnings unless they have voluntarily elected WSIB optional insurance.
Unless otherwise stated, any subsequent reference to contractors refers to individuals in industries other than construction. Insurable earnings include amounts reported on an earnings statement, or wage slip before any deductions are made for income tax, Employment Insurance EI , Canada Pension Plan CPP , health care plans, loan payments, union dues.
For further details, see , Optional Insurance. If a contractor who is not registered as an employer with the WSIB for any portion of the period under contract with the principal is found to have employed workers, then the principal is liable to pay the premiums owed retroactively for the insurable labour portion of the contract between the principal and the contractor.
The extent of the add-back of earnings to the principal is determined by , Employer Premium Adjustments. To calculate the portion of insurable earnings and the resulting premiums payable to the Ontario WSIB when:. The table is also used in cases where the WSIB finds that an unregistered contractor has employed workers.
In these cases, if there is evidence that the contractor supplied major materials or heavy equipment, then the WSIB uses Column B to determine the labour portion of the contract between the contractor and the principal. Major materials means major structural, mechanical and electrical components, such as:.
Heavy equipment means any large item of capital equipment used in the landscaping industry, such as:. The WSIA sets annual maximum average earnings as the basis for the calculation of benefits.
In addition, the WSIA provides that the insurable earnings of an individual worker for the purpose of premium calculation be limited to an annual maximum amount of insurable earnings. Excess earnings for an individual worker are any earnings that are above the annual maximum insurable earnings amount. Excess earnings are not insurable and premiums are not paid on them.
Employers pay premiums on gross insurable earnings until the earnings of the worker reaches the annual maximum insurable earnings amount. The following guidelines apply when the employer has more than one classification code, and the employer is determining insurable earnings for calculating premiums for:. Employers with an account having more than one business activity in more than one classification code are required to allocate insurable earnings amounts to each classification code.
Employers must have segregated wage records in order to have multiple classification codes. The general rules for assigning separate classification codes for multiple business activities are provided in , The Classification Structure. An employer with segregated payrolls may have workers dedicated exclusively to each classification code, or workers may perform business activities in more than one classification code.
As long as segregated wage records are maintained for each worker, insurable earnings can be assigned to multiple classification codes, see policy , The Classification Structure. The separate classification codes for non-exempt partners or executive officers in construction are distinct from other construction classification codes, and are to be used only for reporting the insurable earnings of non-exempt partners or executive officers who are eligible.
Determine the gross earnings for each person during the reporting period. This includes optional insurance and volunteer forces, if applicable. Gross earnings include items such as room and board, vacation pay, and any taxable benefits that are included in Box 14 of T4 earnings. For details see earnings to include. Include the labour portion of the contract for contractors or subcontractors, if the WSIB does not consider the contractor to be an independent operator.
Deduct non-insurable gross earnings such as supplementary maternity benefits, executive officers earnings, not included in mandatory coverage in construction, and excess earnings above the annual maximum from your total gross earnings.
The result is your total insurable earnings. See examples of non-insurable gross earnings under earnings to exclude below. No earnings to report? Who you are responsible for insuring Anyone you employ in your business, including family. Full-time, part-time, seasonal or temporary employees, certain domestic employees, unregistered individuals engaged in construction work, students, apprentices, learners and training participants Yourself — if you are an independent operator, sole proprietor, partner or executive officer in the construction industry.
See Expanded Compulsory Coverage in Construction for exceptions. For details and exceptions on who must be insured, please see our policy on Workers and Independent Operators. Earnings to include Any taxable benefits included in box 14 of the T4 such as wages, annual salary or payments for piece work Room and board that are part of earnings Bonuses and commissions Merchandise awards Profit-sharing Overtime pay Sick pay Vacation pay Severance pay if an Employment Insurance EI Record of Employment has not been issued For the complete list of earnings to include, see appendix I of our Determining insurable earnings policy.
If common work is performed, you must include a portion of the common earnings with each NC when calculating premiums as follows: Determine the direct earnings for each NC. Learn about the partnerships we create with developers of products related to our fields of activity, SRM installers and QESI promoters, trustees and mandataries.
Online Services Forms and Publications. Use our online services and download our forms, publications and guides. Search search Launch search. Learn More. Calculating Source Deductions and Employer Contributions. Minimum qualifying threshold. Print Share. For all. One vision.
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