In a decision that will likely come as welcome news to employers across the province, the Ontario government has announced that it intends to introduce legislation that, if passed, would permit a large amount of the WSIB’s reserve funds, currently valued at $6.1 billion, to be distributed amongst what the government characterized in a press release as “safe” employers.
Currently, the Workplace Safety and Insurance Act prohibits the WSIB from returning surplus funds to the companies that fund the system. The proposed legislation arises from a recommendation made in the Workplace Safety and Insurance Board Operational Review Report.
The Report stated that adopting this approach, “…will help to protect against the risk of overfunding and the potential for ad hoc or politicized decisions.” It was also noted that Alberta currently has a system where surplus funds in the workers’ compensation system are returned to employers.
Details on what will be defined as a “safe” employer or how the surplus funds will be allocated have not yet been released. The government press release included several favourable comments from groups representing various business interests. Not surprisingly, worker representatives have made several public statements criticizing the proposed legislation.
Since there is presently a majority government, we anticipate that this legislation will pass and come into effect before the June 2022 Ontario provincial election.