WSIB Preparing For Lower Premium Rates
However, now this picture has changed. It is expected that the WSIB will soon announce that the unfunded liability milestone has been retired, and the funds allocated to pay it off will, over time, be eliminated from the premium rates.
OGCA, through the Construction Employers Coalition (CEC), has proposed that 70% of the reduction be applied in 2019 and the remainder in 2020. We are very optimistic that Chair Elizabeth Witmer and President Tom Teahen are seriously considering our proposal. They will announce 2019 premium rates at their September 26th Annual Meeting, and by all indications, we will benefit from a significant reduction.
General Contractors reporting under rate #723 - ICI Construction, currently pay $4.07, which was reduced by 15% for 2018. It acts as a 4% surcharge or a payroll tax that is added to construction costs and makes industry less competitive in other jurisdictions. If implemented, the reduction will help Ontario employers deal with crippling payroll costs and support economic growth.
When the past claims cost is eliminated, it will collectively reduce premium costs by about $2 billion per year, about $600 million of it from the construction industry. The reduced payroll burden will support employment growth and affordability.
By bring premiums in line with other jurisdictions, the WSIB will fulfill a long-standing commitment to reduce rates when full funding is achieved. We have been in ongoing discussions with the WSIB supporting their movement to fiscal sustainability, and we eagerly await reduced premium rates to follow.