Overview of Workers' Compensation

Workers' Compensation programs protect employees from financial hardships associated with work-related injuries and occupational diseases.

Workers' Compensation Boards administer workers' compensation in each province. Each board publishes a list of classification units for various types of work being performed. The board also assigns a rate for each classification unit.

The provinces and the corresponding workers' compensation board are predefined in the application. Use the Manage Legal Entity HCM Information task in the Setup and Maintenance work area to define the workers' compensation classification unit and account information at the payroll statutory unit (PSU) level. Here are a few things to consider while defining the workers' compensation information:

• Since an employer can have multiple accounts within a province, you must designate one account as the default for the province.

• Since multiple classification units can apply to each account and each classification unit has an associated rate, you must designate one classification unit as the default for an account. There's a 1:1 relationship between the classification units and its associated rate.

The details you define at the PSU level are valid for all the tax reporting units associated with the PSU.

The province of employment determines which workers' compensation board is associated to the term or assignment of the employee. The rate associated with the default account is used to calculate the workers' compensation liability, unless you override the details. You can define overrides for workers' compensation processing for a person at the assignment or term level, job, location, or department. Certain assignments of employees may be exempt from workers' compensation premiums. Set this exemption at the assignment level.

The employer liability is calculated as a rate multiplied by the assessable wages, up to a maximum assessable wage defined for the province.