Canadian Contractor

The unexpected ripple effect of mandatory WSIB in Ontario

In a few weeks, Ontario's WSIB mandatory coverage will be extended to self-employed sole proprietors, partners in partnerships and officers of corporations in the construction industry. Contractors who are carrying independently-purchased disability insurance need to take a close look at how their own coverage dovetails, or conflicts, with that of the WSIB. If you don't, you might find that you are wasting money and not getting the coverage you need.

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December 17, 2012 by Alec Caldwell

Most Ontario contractors I’m sure know by now that in a few weeks WSIB’s mandatory coverage extends to self-employed sole proprietors, partners in partnerships and officers of corporations in the construction industry, whether they like it or not. Suddenly all these individuals will lose their independence and be forced into the compulsory WSIB system, with few exceptions.

This aggressive extension of the WSIB’s reach is already starting to cause concerns amongst those affected. And not just because of being forced into the system; it’s the ripple effect of how many will now be forced to treat any individual disability income insurance coverages that they already have. Will this be a duplication of coverages? If so, can you afford to pay both in today’s economy?

We all know that the WSIB covers you for injuries at work and the loss of income if you cannot work because of those injuries. Independent disability income insurance works along the same lines, but normally goes a little further and extends coverage to included off-the-job accidents, accidents on weekends and illness – if you have those eventualities added.

There is no doubt that some duplication will occur if you decide to carry independent disability insurance as well as the WSIB. So don’t expect each to pay you fully if you’re disabled at work and you can’t work. Most independently-purchased disability income insurance coverage carries an offset clause. This allows insurance companies to reduce what they’ll pay you dollar for dollar on any money coming to you from WSIB. Meaning for every dollar of income you receive from WSIB, the insurance company will remove that dollar off their payment to you, sometimes down to half the monthly income benefit you expected, or to zero, where you receive no payment!

Now some good news, there are a few coverages out there that correct this unfairness and do not carry an offset clause. Meaning they’ll pay you the full monthly income benefit, regardless of what WSIB or your auto insurance company may pay. Right now a good number of contractors we’ve talked with are considering changing over to this type of coverage or simply going with the non occupational version that is built around WSIB and tops up a person’s coverage to 24 hours a day, 7 days a week, without them paying duplication costs.

If you want to explore your option,s CARAHS can help you do this with its newly introduced “Know your options” service. Anyone can use our free service, by contacting our qualified advisors, who are equipped to answer your questions. Contact us by email or toll free.

Email or by phone toll free at: 1-866-366-2930

CARAHS is a non-profit Occupational Health & Safety Association delivering education, training & benefits to self employed contractors, renovators, builders & trades.

Alec Caldwell

Alec Caldwell

Alec Caldwell is the Founder of CARAHS, a Health & Safety Organization. We are approved providers by the Ministry of Labour (Ontario) to teach Working at Heights Training (Pro#34609) Visit the Ministry of Labour's web site to view our listing
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27 Comments » for The unexpected ripple effect of mandatory WSIB in Ontario
  1. Posted on behalf of Rose Griffiths, CMA

    LinkedIn Groups – Group: BNI Canada

    Discussion: The unexpected ripple effect of mandatory WSIB in Ontario

    Glad Alec has written on this subject. Realize of course this is to catch the underground economy that hid some or all of their income. A few bad apples in the construction industry has made it hard on the honest ones, so unfortunately everyone pays. I will certainly speak to my clients who are in this industry about their private insurance to ensure that are not paying for something they will never get.

    Posted by Rose Griffiths, CMA

  2. Posted on behalf of Amir Riaz

    LinkedIn Groups

    Group: Networking for Trade Professionals Ontario
    Discussion: The unexpected ripple effect of mandatory WSIB in Ontario

    Coz they don’t have money plus they paid lot of claims that’s why they force to everyone
    Posted by Amir Riaz

  3. Posted on behalf of Raymond Hunt

    LinkedIn Groups

    Group: Contractor Discussion Group. For Plumbers, Electricians, Remodelers, Roofers, HVAC, & Handyman
    Discussion: The unexpected ripple effect of mandatory WSIB in Ontario

    In my opinion, the option to cancel payments for private commercial injury insurance and start paying into WSIB as a contractor may mean savings – for me. I still need to carry commercial Insurance on my truck and tools, however, I don’t work with employees, like I did twenty years ago. Most of my help today are professional trades who also pay into their own WSIB. What I do know is, nothing is done to help the contractors…I see this as another money grab by the Ontario government mafia.
    Posted by Raymond Hunt

  4. Adrian Bynoe says:

    I am very surprised there are not vast numbers of contractors like myself, who are totally pissed off with this change.
    Let me explain – I am a small contractor with annual sales around $200,000 so I do most of the work myself, but have been paying WSIB for any casual labour or sub-contractors for years. The government of Ontario changed the law so that I the owner operator who occasionally does commercial jobs must now pay WSIB for my self. They changed the law to:
    1. Impose health and safety
    2. Level the playing field
    3. Help combat the underground economy in the construction sector
    How can I give a competitive quote to proposed clients, when I have to pay 13% HST and now another (nearly) 10% WSIB on my labour – when most guys are willing to accept “cash”.
    Like how stupid are you to believe this will combat the underground economy – people wanting small renovations or repairs done are looking for the lowest price and that’s a fact.
    The WSIB need to get everybody to pay up, that’s how they will get more income and not penalizing us “above board” guys to the point where we have no choice but to survive by going underground.
    For starters they could get all the contractor names from Rona and all the other suppliers, call that contractor and see if they contribute or not. Oh and I believe they have the authority to do this after all when they audit you they want to see all your records, CRA assessments, etc
    Secondly appoint some officers to drive around any neighborhood or sub division – the contractor van is very visible – do you have WSIB coverage ??
    I see it as being that simple, am I wrong ?

  5. Adrian Bynoe says:

    Continued from last email

    I am hoping other contractors will also speak up and express their opinions so that a fair system can be developed to help us all.
    Alec you need to make our grievances heard….please

    Do you know why government workers do not look out the window in the morning?
    because they will have nothing to do in the afternoon………..

  6. Posted on: LInkedIn Group CARAHS by Rich Krechowicz

    I spoke with my Canadian Federation of Independent Business representative, and was told that CFIB were within reach of having Bill 119 (mandatory coverage) repealed, or at least not implemented. McGuinty’s resignation and the prorogation of the Legislature stopped all work and progress on this file. I am told that they are expecting to resume these efforts with the new Premier, but in the meantime we will probably have to comply, however reluctantly and certainly under protest.

    As far as other reforms needed at WSIB, I told my rep that I thought that “named insured” should be implemented, and that WSIB should undertake a marketing/information campaign encouraging contractors and homeowners to request Clearance Certificates as a way to help weed out the slippery underground players.

    Posted by Rich Krechowicz

  7. Blog post reply to article from CARAHS web site. From Dream Home Fencing
    See at

    The only way the government is going to be able to shut down the underground economy, is to permanently introduce home improvement tax credits. Eg a senior on a fixed income would have to withdraw from RRSP’s they are taxed to death on them, so for a $20,000 renovation they would have to withdraw $35,000 from RRSP’s and then pay the tax to the contractor. Until the government takes responsibility for small business investment in employement and trades there will always be an underground market.

    • eric monkman says:

      The underground economy is easily stopped if the “Buyer” is held responsible
      as well as the “Contractor” for any HST re-mittances not collected.

      Further ‘Any GovernmentEmployee” at any level, Municipal, Provincial or Federal, found playing in the underground economy should be fired immediately and lose all Pensions and Benefits.

      Just one prosecution under this type of penalty will cause all the tax cheaters who play the game to stop, period.

  8. chris says:

    Adrian, not sure why you pay your sub contractors WSIB? They must carry their own.

    This new bill and tax grab has nothing at all to do with the underground other then give the illegal workers yet one more leg up in competing for projects. It’s being imposed on already licensed and paying Contractors/owners in all the trades. In what other line of work are you FORCED to buy/pay for insurance?

    And, why does this imposed insurance only fall on the Construction industry? I haven’t seen anything about Farmers, who do have to pay WSIB for employees and for the Fishing industry… both of which can be far more dangerous then most construction.

  9. I hate the government and insurance mafias says:

    To hell with the WSIB and their criminal cash grab from small business. Hello more cash jobs and fudged payroll numbers. No more on the books employees only independent casual workers from here on in. Screw em, I played by the books and they just hammer you. Not playing by the books anymore. The WSIB will get next to squat.

  10. Done Trying To Be Honest says:

    I’ve tried to do the right thing, taxes, WSIB, but I’m pushing a heavy stone uphill with the government pushing from the other side down. I refuse to pay this extortion money and will cut my employees, and go it alone underground. If you can’t come up with something as an intelligent government that doesn’t penalize the whole industry for the sins of the few then you are essentially throwing the baby out with the bathwater implementing this mandatory coverage. I’m giving my employees to you Liberal government to look after and joining the ‘underground’ movement. Well done, you just made it worse.

  11. chris says:

    One other snag in this WSIB joke of an insurance policy. Our accountant has just pointed out that I, the billing, estimating, phone answering, lunch making, employee paying etc, etc, partner am now ALSO to be paying in to it!!! If any other Contractors have spouses, children on the payroll but not working ON the sites, IN construction, guess what?
    There is a form to file for exemption. But it is limited to one partner in the company.
    This will likely hinge on if this person is legally a partner as I am understanding it but do check that out.

    The worst thing about this imposed tax grab is, as I said before, few if any Contractors will ever be able to collect a payment unless they close the business. WSIB doesn’t pay you if are working and it would take some kind of horrific accident to render a Contractor unable to continue his business, so long as he had employees. So, pay in but never be able to collect, pretty sweet for the government.

  12. Hi everybody,
    We are all in the same boat … all against that new Bill 119.
    On February 12, 2013 it’s time to protest !!!!
    On February 12 a large group of contractors are going to protest at 10:00 am at the WSIB office, 180 Kent Street, Ottawa and after going to Ministry of Labour, 347 Preston also in Ottawa.
    Join us with buses, trucks, trailers, boom, crane, cube van, service truck, backhoe … and put on your hard hat.
    for more info, contact me 613-764-1530

  13. Stan Thayer says:

    Forty two years of doing cash jobs and proud of it!
    Lets talk about the underground economy.
    Lets talk about people who pass underground bills without informing those affected.
    Lets talk about taxpayer paid inspectors that look the other way, $$$.
    Lets talk about lies, deceit and how to be Premiere of Ontario.
    Lets talk about paving a driveway to get a municipal contract.
    Lets talk about an insurance board that is a parking lot for unelected croneys.
    Lets talk about lifetime appointed ministers with no experience.
    What we should be talking about is a yearly explanation by every taxpayer funded employee as to what they do and why we should keep paying them.
    Just the facts, Ma’am, just the facts!

  14. I am Devastated at this Bill, I have been in business for 17 yrs, I only bill out in the $40,000.00 range, I am single with a home and a truck that drinks the fuel, this bill will cripple my business as the extra $4000.00 is just not there, if I pay this I will have to cut my hydro payment and many other life sustaining necessities, not having a calm day for a work performance because of the stress of the WSIB collection department telling me that they will take my bank account, my answer “then pay my overdraft”, if my account is seized, then the phone ,cell, hydro, mortgage, 3 kinds of insurances, Visa, truck loan, line of credit, and spending money in the economy, don’t get money. Welfare is looking pretty good now, hopefully this stress I am under now because of this, doesn’t get me hurt up on my scaffolding, then maybe WSIB can pay me for life, because this stress will kill a lot of people. ARE THEY MAKING OUR DAY SAFE?, NO!!!!!, they are killing us. I have to go out of business if this is going to continue. Then I will be really broke and lose everything, that is quite an economy boost eh! I wish I had just one expense account of a politician, that is more then I make in two years and I work very hard for my money, for what now, devastation to set in.

  15. Brad says:

    I am still confused. Since I am being forced to pay WSIB, do I really need other insurance? I have had coverage with Penncorp for about 20 years now. But paying both is too much. WSIB is about $450 a month and Penncorp is $210. If I get hurt, and revieve money from Penncorp, will WSIB not pay me? Or the other way around?I am getting older and we all know you don’t recover from injury as much as you do when your young. Would I be throwing away something I should keep? I don’t know what to do.

  16. Alec Caldwell says:

    Hi Brad,
    I hope I can sort this out for you and sorry if my explanation is long 🙂

    Penncorp will pay out 100% on top of a WSIB claim. Meaning if an injury occurs on the job and WSIB are involved, you will get paid both fully.

    Secondly in my 33 years of experience with contractors: most injuries I’ve found happen off the job. They can be as simple as one claim I’m dealing with right now for a contractor. He’s in his driveway fooling around and jumps 15inches in to the air and lands badly on his right ankle. He fractures a dozen bones in a fraction of a second.

    He’s already been paid claim 3 months so far, at a total of $6,000 and from the 1st day through Manulife. The specialists doctor reckons he’ll be off another 5 months. So if that was you, Penncorp would pay and WSIB are not involved, as its off the job.

    He pays $86.00 a month for his cover, so your policy sounds expensive. I know prices have come down over the last few years due to competition like the Manulife one I’ve just mentioned. New Penncorp coverage have also come down, but not on existing coverage’s that are in force like yours. If you’re willing to pay your existing $200 a month insurance companies will leave you paying it. Its totally wrong, but that’s their system.

    Another contractor I dealt with recently got out of his van at night in the dark outside his home, stepped down onto a rock and fell over. He was off 2 months and got paid through his private cover WSIB was not involved, as he was not at work.

    I’m going to suggest this to you and to anyone reading this. You should get your existing Penncorp cover checked out by someone. If you don’t have anyone CARAHS have licensed people who’ll do this for you for zero cost. They can quickly shop the market for you and hopefully save you money. This way you can maybe afford both, which is safer for you.

    You can call us Toll Free at 1 866 366 2930 and Monica is the person to ask for.


    CARAHS is a non profit organization for self employed home renovators and home services EDUCATION – TRAINING – BENEFITS

    Toll Free at 1 866 366 2930

  17. John says:

    I read up on this nonsense. I’m glad I’m exempt from it. This is nothing but corruption from our poor govt. Insurance has been forced on people in some pretty bad ways over the last few years, and I’m not just talking about our broken province. Look what Omama is doing in the US, its come full circle there and we now learned that hundreds of thousands had their own insurance cancelled and only 6 people signed up for the new plan. That is 6 out hundreds of millions. not 6000 or even 600, and we also learned that this was the plan of the insurance companies that also funded his campaign.

    My point with WSIB. If it is forced on me I will take twice as much out as I put in. Every single thing from dust in my eyes to a charlie horse is going to be a claim. I also won’t hire anybody except for a cash contractor who I trust. Who’s winning now ? Is this also true, I read somewher that the WSIB is millions in debt, so you’re paying for nothing to begin with. Its like the stock market in the US that sells paper with no backing.

  18. kill bill 119 says:

    first cash job of the year and many more lined up! whoohoo!

  19. David says:

    WSIB is the anti-Christ! I hope the ombudsmen gets them! How can my small business survive after WSIB, taxes??? WSIB is fraud ….is there any other competitors we can buy insurance from>??? For most small businesses cash jobs are the only way to feed their family ! WSIB go to hell!

  20. Hi David…..Its crazy and it just got crazier today. Check out the latest that will drive more business underground. Compulsory certification for home renovators and who certifies them. THE UNIONS. THEN you have to become a member and a member of OCOT. Please go to these articles today David and read them. Please add your support to stopping all this. Thanks


  21. Matt says:

    Some of you guys got it wrong, you don’t have to lower your living standard to have enough money to pay to WSIB. All you have to do is to jack up your labor prices to make up for what you have to pay to WSIB.
    First of all don’t call it an insurance, just call it work permit, that’s all it is.
    No clearance certificate- no work, so it is work permit.
    Look at dictionary- word “clearance” means- Permission.
    An insurance is when you are covered 24/7, on vacation, weekends, days, nights, etc.
    When I do my quote, I always add 7.5% extra for the work permit, you call it WSIB insurance I call it work permit
    In my case I do flooring and have rto pay 7.5% to WSIB from each $100 I make.
    I know that different trades have different rates, but they should charge accordingly to make up for whatever they have to pay to WSIB.
    If all of us guys will follow this practice, things will change, because now prices of houses will go up.