WSIB Policy review

WSIB Policy Changes – 2018

We are pleased to announce, that after five years of meetings, discussions and communication with the Minister and Ministry of Labour, Ministry of Government and Consumer Services and the Workplace Safety Insurance Board, the WSIB has finally decided to change the policies that affect the Home Inspection Profession.

As of January 1st, 2018, Home Inspectors will no longer be in Class G of the WSIB Policy manual.  We will be moving from Rate Group 704, code 4499-001, Testing, Inspection and Related Services, to Rate Group 958, code 7759-001, Other Scientific and Technical Services (Class 1)

This means that mandatory coverage as applies to the Construction Industry no longer applies to businesses that are solely Home Inspection Businesses.   If this applies to your Inspection business, you no longer need to ask your clients questions to establish if the Inspection is exempt or not, and you no longer need to get WSIB Clearance certificates for the Inspection.

While we disagreed with the original policy from the outset of Bill119 and provide this as a solution back in 2013, it has taken this long, and a lot of lobbying, to get things put right. 

We know changes do take a long time to take effect in government circles, and we would like to thank the ongoing efforts of Partick Auriol, Scott May and Len Inkster from OntarioACHI, Hon. Kevin Flynn, Minister of Labour, the MGCS team, including BenValido, Melinda Campbell and Kelly Houston-Routely as well as Jean-Serge Bidal and his team at the WSIB for the work that gets us to here.

We need to remind Inspectors that also provide Construction or Renovation services, under the new policy proposals, all your businesses will be considered construction and this new Rate Group change will not apply, even if you are performing a Home Inspection and not construction work at the time.

More information can be found on this topic here: http://bit.ly/2Chq5qk

We will be monitoring these new proposals and if they adversely affect consumers, realtors or inspectors as the Bill 119 did, rest assured we will be back to Queens Park with more solutions.

Archive Information

WSIB registered InspectorIn early September, the WSIB released 7 draft policies in support of the Rate Framework Modernization.  The draft policies flesh out some of the significant changes that will result from the Rate Framework and provide guidelines on how the WSIB will do classification and determine if a company can have multiple rate groups. The WSIB is looking for submissions to these policies.   We encourage all inspectors to make a submission to explain how the WSIB application of Bill119 unfairly impacts Home Inspectors, Realtors and their combined clients.

The WSIB will accept submissions on the draft policies until October 13, 2017. The policies are available on the WSIB’s Rate Framework Consultation webpage.

We will be providing a submission from OntarioACHI on behalf of all Inspectors in Ontario, and this will run much along the lines as we have explained to the Hon. Kevin Flynn, Minister of Labour, the Ministry staff and the WSIB management team in the past.    We are hoping that this time they will listen.

The policy changes are extremely important and complex draft policies, and the Office of the Employer Adviser is offering a webinar providing a high-level view and a chance to discuss the policies on September 26th at 10:00 am EST.   Anyone who wants to register can do so here:  http://bit.ly/2wPXhO4.

Here’s how the current policy affects Home Inspections.

Background
  • As of January 1, 2013, the Ontario Government made WSIB coverage mandatory for most people in the construction industry
  • Enforcement started on Jan 1, 2014
  • Contractors who are not registered with the WSIB, and who do construction work without a valid clearance number will face fines of up to $100,000 upon conviction
  • Those who hire contractors without confirming they have a valid clearance number also face serious fines and penalties
How it affects home inspections
  • Prior to 2013, home Inspectors were grouped into the “Contractors” group under the WSIB
  • WSIB staff stated this was always the case, so if a change was needed it should have been brought up before
  • As with all legislation, until it changes something, it generally goes unnoticed
  • The risk posed by a Home Inspection to the Home Inspector is not identical to the risk posed to a contractor
Why the policies should be revised
  • The policies are inconsistent
  • The inconsistencies expose the Inspectors, their clients, other professions and the public at large
  • The inconsistencies are likely to increase the costs to the WSIB
  • The inconsistencies will definitely impact the public purse, directly and indirectly
The inconsistencies
  • A Home Inspection is exempt from the WSIB mandatory coverage outlined in Policy 12-01-06 depending upon who the work is for, what type of property, who is paying and what use the property is intended for
  • In the construction industry, where there is an elevated risk of injury, and an elevated risk of liability to a contracting party, the rules appear to make sense.  
    • The infographic explain that the risks to a Home Inspector are nowhere near as great as those to a construction worker.
  • An administrative practice document had to be produced by the WSIB to explain to it’s own staff how to apply the new policy because of the strange application rules
    • A construction job is usually defined by a scope of work, that differs from job to job.  Project scope has to be arranged well in advance between the Contractor and sub-contractor, including payments terms
    • A residential home inspection is always defined by the same scope of work, arranged at short notice, payment is identified last minute
      • WSIB registration and clearance do not critically impact the owner in renovations.  It could mean the difference between a home purchase succeeding or failing in home inspections
    • A construction job generally requires the dismantling and re-building of components, or long-term exposure to hazards (painters on ladders, roofers, electricians etc.)

    • A residential home inspection has minimal risk to the inspector.  No walking on high-level roofs, no touching energised electrical components, no long-term ladder work

      • The WSIB sees the same scope as offering different risks requiring registration for some and exemptions for others when the risk is minimal for all and never changes
    • In-home renovations, the contractor is the owner or renter and the sub-c0ntractor is the construction worker
    • A residential home inspection can be arranged by the client directly or through a third party on behalf of a member of the public (e.g. Realtor)
      • WSIB rules can leave the inspector and 3rd party liable to fines if the conditions of the engagement are changed at the last minute.
    • Construction is typically a younger persons job.  Most construction workers are retired by the age of 65
    • A Residential home inspector is normally on their second or third career, often times after retiring from construction.  Many are in their 60’s some are over 65
      • The WSIB only offers compensation until the age of 65, so the protective nature of the WSIA offers no long-term support for the inspector in many cases and in some none at all.
    • A construction job occurs at the behest of the owner and is carried out on owner property.

    • A residential home inspection is carried out on behalf of a third party.  The homeowner does not contract the Inspector.

    • While the WSIA is designed to provide legal protection to the employer in exchange for compensation to the employee, the WSIA does not legally protect a home owner from an injury caused on site to a home inspection

The confusion

The decision-making process as to whether a Home Inspection is exempt from the WSIB charge is complex and can alter at the last minute.   No change in the risk model to the inspector, realtor or client exist in any case, but because of the way the current policies are applied, a legal requirement for the Inspector to be registered with the WSIB, and fora clearance certificate to be issued changes depending upon the future use of the home or the person who is paying fro the inspection.

For example:

It is very easy to establish is an inspection is commercial in nature when the property to be inspected is a commercial property.  

Shops, offices, factories and other industrial buildings would all be considered commercial.  

They are subject to commercial inspection standards, and commercial inspection charges.  

Any inspector who offers commercial inspections under the current policies should be registered with the WSIB and able to issue a WSIB clearance certificate.

 

 

 

The inconsistency of the policies is highlighted when the inspection is performed on a residential only property.

If the inspection is paid for by the hiring client, who is moving into the property, using it as a residence, then….

  • The inspection is considered exempt from WSIB levy. 
  • The inspector does not need to be registered with the WSIB.
  • The Inspector does not need to provide a WSIB clearance certificate to the client.

 

If however, the person hiring the home inspector is someone other than the person (or close family member of that person) who is going to be moving into the home, or the inspection is paid for with a company cheque, or the inspection is paid for by the realtor, or the home is being purchased to rent or flip, then ….

  • The inspection is not considered exempt from WSIB levy. 
  • The inspector does need to be registered with the WSIB.
  • The Inspector does need to provide a WSIB clearance certificate to the client, and or the Realtor

This information may not be available to the inspector at the time of booking or even performing the inspection.  Additionally, the inspector is, and the Realtor and client may be, held liable should a client suggest the inspection is exempt but is found later to be non-exempt.

 

The OntarioACHI proposals

Because the WSIA is there to protect employees from unscrupulous employers or employers who try to avoid paying for worker injuries, it would be impossible to remove Home Inspectors from the legislation entirely, as there are a number of Multi-inspector companies and Franchises that would fall under the Multi-employee rating group.  We suggested over four years ago the following:

  • Leave the multi-employee rule in place
    • It is a standard rule across all businesses anyway
  • Leave true commercial inspections as requiring WSIB registration clearance
    • These should be contractor/subcontractor profile and scope anyway
  • Make ALL Residential Inspections, as defined by the Ministry of Government and consumer Services recommendations, exempt from the WSIA
    • Regardless of who pays, what purpose the residential home is to be put to or who is going to live in the property,  the risks are minimal and identical for every inspection and the WSIA doesn’t protect the liability of the existing homeowner anyway.