Workers' Compensation Insurance

If you are building your own home or employing persons to work around your residence, you may be considered an employer for the purpose of worker’s compensation and safety.

If you are acting as a general contractor in your home construction and hiring subcontractors, you will need to register with WorkSafeBC. If your subcontractors are registered with WorkSafeBC, you will want to obtain a clearance letter to ensure they are in good standing. Regardless of whether the subcontractors are registered, however, you may still have occupational health and safety obligations. See Contractors/Subcontractors.

Similarly, you will need a clearance letter and may have safety obligations if you are hiring an individual to work around your home and that person is an independent business and registered with WorkSafeBC. 

If the person you hire to work around your home is an individual who is not registered with WorkSafeBC, whether you need to register depends on the nature and duration of work. For example, you do not have to register if the person is hired for less than 8 working hours per week to clean your home, or to care for your children before or after school for less than 15 hours per week.

If you start a business and hire a worker in British Columbia, you are required to register with WorkSafeBC. Registration may be done in one of the following ways:

• Online
• Faxing the necessary form
• Calling WorkSafeBC
• Visiting one of the provincial government’s 100 OneStop Business Services kiosks (located in government agent offices, chambers of commerce and local municipal offices)

When you register, you will want to have the following information handy:

• The complete legal name of your business, or the legal names of the owners if you’re registering under a partnership or a proprietorship
• Your incorporation number, date, and jurisdiction if you operate a limited company
• Your Business Number from the Canada Revenue Agency, if you have one
• A brief description of the nature of the goods that you produce and/or the services that you provide and any major tools, equipment and/or machines you use in producing the good  and/or in providing the service
• Make and model of any major equipment you use to generate revenue
• An estimate of your payroll if you employ workers
• Start date of operations and start date of your first worker if applicable
• An e-mail address and contact details for your business
• The names, birth dates and contact information of the proprietor, all partners, or all active shareholders

If you are required to register and fail to do so, you may be subject to a monetary penalty. If you are unregistered and your worker is injured on the job, you will likely also be charged with a penalty reflecting the dollar value of the claims costs for that injured worker. These costs include wage loss, health care, vocational rehabilitation and pensions.

You are entitled to provide an explanation for why you did not register. You are also entitled to dispute the acceptance of the claim.  See Disputing a Decision on a Claim.

If you are the owner of an unincorporated business, you are not automatically covered for WorkSafeBC benefits in the event you are injured on the job. However, optional coverage may be available to you in the form of Personal Optional Protection, or “POP” as it is commonly known.

Because workers are ineligible to register, in order to qualify for this type of insurance coverage, WorkSafeBC will need to be satisfied that you are truly independent from the firm(s) for which you provide services. Questions such as to the type of equipment or materials you supply and how many contracts you have will help to establish your independence.

If WorkSafeBC is satisfied that you are independent and not a worker, you will be allowed to register for POP. The cost of this optional coverage depends on the industry in which you carry on business and the amount of coverage you request. Payment is made on an annual basis for the upcoming year.

If you are injured at work, POP will provide you with most of your medical expenses and 90 percent of the coverage you have selected as wage loss benefits (minimum and maximum restrictions apply).

In general, the following individuals may apply for POP:

• A sole proprietor
• The spouse of a sole proprietor if that spouse works for the sole proprietorship
• Partners of a business which is not a limited company

If you are denied coverage and do not understand or agree with WorkSafeBC’s decision, contact the Employers’ Advisers Office.

When you register with WorkSafeBC, a classification unit will be assigned to your account (firm).

A classification unit describes particular services, materials, and equipment commonly found within a particular industrial activity. For example, if you are a roofing company, your firm may be placed in low slope or steep slope roofing depending on the type of roof you primarily install or repair.

The classification unit to which your firm is assigned is important as this will specify the rate upon which your assessment premiums will be based. These rates can vary dramatically depending on the level of risk of potential injury and historical cost rates in the industry.

Sometimes, a firm may be involved in two or more separate and distinct industrial activities which have different rates. In this case, multiple classifications may be available.

The Employers’ Advisers Office can help you with your registration and classification questions by reviewing the nature of your business and providing an opinion as to the most appropriate classification unit for your company. An Employers’ Adviser can also advise you as to the requirements for entitlement to multiple classifications.

If you believe your firm has been incorrectly classified, the Employers’ Advisers Office can review the classification decision with you and, where there is merit, represent you in the process to have the decision amended. See Disputing the Classification of your Business.

When you register with WorkSafeBC, an account will be opened in the name of your company, or “firm”. Reporting payroll and making remittances to WorkSafeBC may be done on a quarterly or annual basis depending on the amount of your premiums.

Both quarterly and annual remitters make payments for the past quarter or year respectively. 

Penalties for non-reporting of payroll and non-remitting of payments will be imposed. It is therefore important to report your payroll as required – even if your payroll is zero.

Contact the Employers’ Advisers Office for information about the calculation of wages and salaries; shareholder earnings; prorating common payroll; and payments to contractors/subcontractors

A WorkSafeBC audit generally involves an examination of your accounting and related records to ensure you are meeting the reporting and remitting requirements under the Workers Compensation Act. An audit also includes verification of your firm’s classification.

The frequency, scope and years examined by an audit officer will vary from employer to employer and to some degree are dependent on the nature of the operation and the type of labour or contractors engaged.

The records subject to an audit are not limited to payroll journals, but will encompass all books, documents, records, papers and other items which relate to assessable earnings. The audit may take place at your place of business, your accountant’s office or at a location designated by WorkSafeBC.

The conclusions of the audit will be communicated to you in a decision letter. In most cases a copy of the audit working papers will also be included with the decision letter. If you disagree with the decision, you may see a review of it. See Disputing an Audit of Your Business.

The information in this section applies to both contractors and subcontractors. For ease of reference, only the term “contractor” will be used. However, it is important to note that neither term as used in the workers’ compensation system may have the same meaning for other organizations, including the Canada Revenue Agency.

If you’re hiring a contractor, the first thing you will want to do is confirm whether that person is registered with WorkSafeBC. If the contractor is registered, you will want to request a clearance letter from WorkSafeBC that sets out whether the registration is in good standing (see Clearance Letters). The purpose of the clearance letter is to ensure that you are not subsequently required to pay any of the contractor’s assessment payments in the event the contractor fails to remit.

Because clearance letters provide information up to a particular date and do not ensure the contractor will make assessment payments in the future, you may wish to consider holding back a percentage of the value of the labour portion of the contract pending confirmation, by way of another clearance letter, that assessments were paid.

However, your potential liabilities and responsibilities do not end there.

If the contractor is registered and regularly employs workers, your responsibilities will include maintaining the work premises in a manner that ensures worker health and safety and advising the contractor of any known hazards at the workplace. Your responsibilities may also include ensuring activities at the workplace relating to health and safety are coordinated and doing everything reasonably practicable to have a system in place to ensure compliance with the Workers Compensation Act and Occupational Health and Safety Regulation.  If the contractor or any of his workers are injured, claims costs will usually be assessed under the contractor’s WorkSafeBC account.

WorkSafeBC also considers a registered contractor without workers (known as an “independent operator”), to be your worker for the purpose of health and safety; however, claims costs for any injury the independent operator suffers at your workplace will usually be assigned to his account..

If the contractor is unregistered, WorkSafeBC may consider the contractor and any of the contractor’s workers to be your workers for the purpose of health and safety. This means that all the obligations you have for the health and safety for your own workers apply to the contractor and the contractor’s workers.  You may also be responsible for the claims costs for injuries suffered by the contractor and/or the contractor’s workers at your workplace.

 Responsibilities owed to contractors are very complex and involve multiple sections of the Workers Compensation Act and various WorkSafeBC policies. We recommend that you contact the Employers’ Advisers Office for further advice and assistance before hiring a contractor.

If the contractor or subcontractor you hire is not registered or is not making its payments to WorkSafeBC, you could be liable for insurance premiums owing in connection with the work or service being performed on your behalf. 

In order to protect against these liabilities, ask the person you are about to hire if he or she has workers’ compensation coverage. If so, obtain the WorkSafeBC account number(s) and request a clearance letter from WorkSafeBC before you hire. This letter will confirm registration and whether the subcontractor in in good standing.

Clearance letters are available from WorkSafeBC by telephone (604-244-6180 or toll free 1-888-922-2768), fax (604-244-6490) or online at www.worksafebc.com.   To expedite requests, ensure you have the contractor’s correct legal name, address and account number.

Because clearance letters provide information up to a particular date and do not ensure the contractor will make assessment payments in the future, you may wish to consider holding back a percentage of the value of the labour portion of the contract pending confirmation, by way of another clearance letter, that assessments were paid.

It is recommended that quarterly updates of clearance letters be obtained to ensure the contractor is keeping up-to-date with payments to WorkSafeBC.

You may wish to subscribe to "Clearance Alert", an online service which automatically provides notification of any changes to a contractor's status with WorkSafeBC.

Clearance Alert allows you to submit a list of contractors over a secured online server. You can add or remove names from the list as desired.  WorkSafeBC monitors the clearance status of the contractors on your list and notifies you by e-mail of any changes to clearance rating.

WorkSafeBC also provides “GoldStar Clearance” for contractors who have a good track record with WorkSafeBC. Unlike other clearances which ‘clear’ contractors for past payroll periods, GoldStar Clearances are automatically advanced for those qualified to the start of the next quarter. For example, a contractor that has reported its payroll and paid its premiums to April 1 may receive GoldStar Clearance to July 1 of that year.