Maximum insurable earnings (workers’ compensation)

A buyer budgeting workers’ compensation premiums meets this ceiling when reading the seller’s payroll. The WSIB says only insurable earnings, subject to the maximum set each year, go into the premium calculation. It says the Workplace Safety and Insurance Act, 1997 limits a worker’s insurable earnings for premium calculation to an annual maximum, and that the WSIB’s annual maximum takes effect each January 1.

How the WSIB describes it

• Excess earnings are any earnings above the annual maximum for an individual worker, and are not insurable.
• The WSIB says it sets the annual maximum based on the average industrial wage for Ontario.
• Once a worker’s earnings reach the maximum, the WSIB says the employer does not need to report the excess.
• The WSIB’s policy says the Act sets a separate annual maximum average earnings for benefits, and in years where the two differ, premiums follow the maximum insurable earnings.

What to ask

Ask for payroll by worker, and look up the current year’s published amount rather than relying on an earlier year’s. See the WSIB clearance certificate and workers’ compensation assessments. This entry covers Ontario only; check the rules where you are.