BY CHRISTINE ARNOTT
The Workplace Safety and Insurance Board (WSIB) is transforming how it calculates premium rates for almost 300,000 registered businesses across Ontario. A new premium rate setting model is being introduced that is simpler, easy to understand and will be more reflective of individual claims experience. The change, which follows a multiyear engagement with businesses across the province, makes it easier to understand how businesses are classified and how premium rates are calculated. Another major benefit of the new rate framework is the ability to see the direction premium rates are headed in the future.
The change only takes effect January 1, 2020, but it’s important to make sure that businesses are aware of what to expect under the new model.
The WSIB is replacing the current classification system based on the Standard Industrial Classification (SIC) coding system with a new system called the North American Industrial Classification System, or NAICS. By switching to NAICS, WSIB will be using the same system Statistics Canada and the Canada Revenue Agency use to classify businesses. It will help to simplify and streamline classifications, making it easier to understand why businesses are classified the way they are. In the rate framework, each business will be assigned to a Predominant Class. This is generally based on the Class that represents an employer’s largest percentage of insurable earnings.
The new system will strive to ensure that premium rates are fair and transparent. When calculating premium rates, a business’s individual claims experience will be taken into account so it will be paying a rate based on actual workplace injury history. WSIB will also provide businesses with projected premium rates, which show the future direction of insurance premium rates. This new rate information will allow businesses time to prepare and adjust for future rate changes. Changes to premium rates will be capped so they are spread over time to allow businesses to adjust to any changes gradually.
The new model will not affect the overall total amount of premium dollars collected by the WSIB. The rate framework is revenue neutral and will maintain the risk sharing arrangement among all employers who collectively pay premiums to maintain the insurance fund.
What’s changing in the mining industry?
Because the WSIB is adopting a new standardized approach to classifying businesses and will be using the NAICS structure, the mining industry will see a classification change. Employers that engage in business activities in the mining industry will be assigned one or more NAICS codes that fall under Class B, Mining, quarrying and oil and gas extraction and will be assigned a premium rate in Class B.
What’s next?
On September 8, the WSIB launched an extensive engagement campaign about the rate framework. Every business registered with the WSIB received a letter with information about the rate framework, the new classification system and what each business’s new classification will be in the model, along with how businesses can update or change their new classification information online.
This is the first step in making sure businesses are informed and aware of what will be changing in the rate framework.
The aim is to continue to engage with businesses as the WSIB transitions into the new model. In 2018, further information will be provided to help businesses prepare for implementation in 2020, including what premium rates will look like under the new model.
What should you do?
To support the launch of the new model, the WSIB has created a dedicated website – www.wsibrateframeworkreform.com – with all the latest news, updates and information about the rate framework. Once a business receives its letter, it’s important to take a moment to review the new classification and visit the website to learn more about the rate framework.
Christine Arnott is public affairs manager, Workplace Safety Insurance Board.
Source : www.sudburyminingsolutions.com