Document name

Employer Coverage and Registration

Document number

POL 12/2020

Contract for service, also referred to as a principal-contractor relationship, is where a business or individual provides labour services, which may involve the use of equipment, to another business or individual on a contract basis in return for a monetary amount.

Contract of service, also referred to as an employer-employee relationship, is where an individual is hired by a business or individual on a full-time, part-time, or casual basis in return for wages or a salary.

Contractor or subcontractor means a business or individual hired under a contract for service by another business or individual and can be present in all industries.

Employer means any person, association or body that hires one or more workers on a full-time, part-time, casual, seasonal or contract basis.

Principal means any person, association or body that hires a contractor. Principals are considered employers.

Worker is a person who has entered into a contract of or for service, written or oral, expressed or implied, and includes:

1. A learner.
2. A member of a municipal volunteer fire brigade.
3. A director of a corporation who reports earnings on a T4.
4. A contractor (including a director receiving assessable earnings reported on a T4A and T5018), and
5. Any person who is considered to be a worker by the Board.

1. The Workers’ Compensation Act, 2013 (the “Act”) applies to all employers and workers engaged in any industry in Saskatchewan except those industries excluded under The Workers’ Compensation Miscellaneous Regulations (the “Miscellaneous Regulations”) (Section 3(1)).
2. The Workers’ Compensation Board (WCB) has exclusive jurisdiction to determine whether any industry or worker is within the scope of the Act (Section 20(2)).
3. An excluded industry, employer or worker may apply to the WCB to be brought within the scope of the Act (Section 3(3)).
4. The worker of a contractor is considered to be the worker of the principal, unless the contractor is an employer in their own right (Section 131(2)).
5. If the owner of equipment, who is not an employer or does not have their own WCB coverage, enters into a contract with a principal, they are considered a worker of the principal (Section 8(2) and 8(3)).
6. Employers must annually report assessable earnings paid to workers and contractors to the WCB (the Act, Section 122, and The Workers’ Compensation General Regulations, 1985 (the “General Regulations”), Section 3).
7. Employers who hire contractors must report the name, address, nature and amount of the contract to the WCB (General Regulations, Section 17).
8. An employer cannot deduct WCB premiums from workers or contractors, except in cases where a contractor, who does not have their own WCB coverage, owns/leases and operates equipment or hires another person to operate that equipment (Act, Sections 8(4), 164).
9. A non-employing proprietor, partner, or director of a corporation not reporting assessable earnings on a T4, T4A or T5018, when not under a contract for service with a principal and has no other means of availing coverage under the Act, may apply for optional personal coverage (General Regulations, Section 14). It is the WCB’s intent to protect persons whose living depends on their own personal work from the financial consequences of a work-related injury.

1. A business may operate in a form of:
   1. A proprietorship, which is an individual who owns and operates a business.
   2. A partnership, which consists of two or more individuals or businesses joined together in a common business venture.
   3. A corporation, which is a separate legal entity with a continuous existence apart from that of their shareholders, or
   4. Other associations or bodies, which include, but are not limited to:
      1. A board or commission.
      2. A municipality.
      3. The Province of Saskatchewan and its agencies.
      4. A school board and the conseil scolaire.
      5. A non-profit organization.
2. Coverage with the WCB may be:
   1. Mandatory.
   2. Personal or optional, which is outlined in POL 03/2014, Coverage – Personal, or
   3. Voluntary, which is covered in POL 21/2014, Coverage - Voluntary.
3. The following individuals operating in a mandatory industry are not automatically covered under the Act but may elect optional personal coverage in accordance with POL 03/2014, Coverage – Personal:
   1. A director of a corporation who hires a worker(s) or contractor(s) and is not reporting assessable earnings on a T4, T4A, or T5018.
   2. An owner of a sole proprietorship or partnership and/or their spouse, who hires a worker(s) or contractor(s).
   3. An individual operating a business who:
      1. Is not under a contract for service to a principal,
      2. Does not hire a worker(s) or contractor(s), and
      3. Is not an employer, worker, or contractor.

Employer

4. All employers operating in an industry covered under the Act must register for an account within 30 calendar days of hiring a worker(s) or contractor(s) as outlined in POL 09/2011, Failure to Register a Business.
5. Employers are required to report assessable earnings for workers and contractor labour annually, up to the maximum assessable earnings amount per worker per calendar year, as noted in POL 24/2010, Assessable Earnings, and POL 10/2019, Maximum Assessable Wage Rate.
6. When a contractor is considered a worker of the principal, they are classified at the principal’s industry rate code and the principal is required to pay premiums for the contractor based on the labour portion of the contract.
7. Employers cannot deduct WCB premiums from workers and contractors, except in cases where the contractor, who does not have their own WCB coverage, owns/leases and operates equipment, as outlined in POL 14/2020, Contracts Involving Equipment.
8. A principal is required to obtain a clearance before paying any contractor to protect them from paying the contractor’s overdue premiums. Guidelines are outlined in POL and PRO 22/2014, Employer Accounts – Clearances and Letters of Good Standing.
9. If an out of province employer sends workers or contractors into Saskatchewan, coverage and registration will be determined in accordance with POL 07/2002, Coverage within Saskatchewan – Out of Province Employers.

Worker

10. All workers in Saskatchewan, regardless of age, are covered when working in an industry to which the Act applies.
11. WCB does not cover workers employed in excluded industries or occupations listed in the Act and Miscellaneous Regulations. These workers may be eligible for voluntary coverage as outlined in POL 21/2014, Coverage – Voluntary.
12. Volunteers are not considered workers under the scope of the Act with the exception of volunteers in mine rescue work, members of the Emergency Measures Organization, volunteer firefighters, and first responders.
13. All family members, except the spouse of a proprietor or a partner, are considered workers if they are paid a wage or a monetary amount.

Contractor

14. A contractor or subcontractor is a business or individual hired and paid by a principal to perform work or services that are:
    1. Carried out at the principal’s premises or worksite, or at a location determined by the nature of the work being performed.
    2. For the purpose of the principal’s trade or business, and
    3. Either integral or incidental to the principal’s day-to-day operations.
15. If a contractor in an excluded industry works for a principal in a mandatory industry, the contractor and their worker(s), if applicable, are not covered as workers of the principal.
16. Contractors who do not hire others are independent workers and may be eligible for their own account. Coverage requirements are detailed in POL 13/2020, Independent Worker Coverage.
17. Contractors who own or lease and/or operate equipment may be covered as a worker of the principal. Coverage requirements are outlined in POL 14/2020, Contracts Involving Equipment.

Cancellation of Coverage

18. An employer’s coverage in an industry that is mandatory under the Act will only cease when the business no longer hires workers or contractors.
19. If optional coverage has been purchased for the business owner, coverage will remain in effect until the employer requests in writing that coverage be cancelled or until the WCB cancels it for circumstances outlined in POL 03/2014, Coverage – Personal.

Other Considerations

20. For some industries and occupations, businesses may have various business arrangements with individuals, making it difficult to determine whether an employer-employee or principal‑contractor relationship exists.
    1. In most cases, the business that pays a wage or a monetary amount is considered the employer.
    2. If the employment relationship cannot be easily determined, the decision will be at the discretion of the Employer Services staff based on the information provided.