Workers' Compensation programs protect employees from the financial hardships associated with work-related injuries and occupational diseases.
Once you are registered with your provincial Workers' Compensation Board (WCB) you will need to pay Workers' Compensation Insurance (WCI) premiums based on your industry classification and each employee's earnings.
In this article, you'll learn about:
- How to set up a rate
- How to edit a rate
- How to delete a rate
- How to assign a rate to an employee
- How to calculate a rate based on a paycheque
- Accounting treatment
- Payroll tax centre
Create and manage rates
Once you have subscribed to Payroll and set up your employees, it's time to set up Workers' Compensation (or CNESST if they are in Quebec).
Set up a rate
- Select Settings ⚙️, then Payroll Settings.
- Select Workers' compensation, then Set up now.
- Select a Rate description. If you need a new description select Add a new rate description and enter it.
- Enter a Rate (as a percentage) and an Effective date. Select Save.
- If you need more than one rate select Create new item. Select a Rate description and enter a Rate (as a percentage) and an Effective date. Select Save.
Edit a rate
- Select Settings ⚙️, then Payroll Settings.
- Select Workers' compensation, then Edit next to the rate you want to edit.
- Change the percentage Rate, Effective date or Rate description as needed. If you need a new description select Add a new rate description and enter it. Select Save.
Delete a rate
Only rates that are not currently linked to an employee can be delete.
- Select Settings ⚙️, then Payroll Settings.
- Select Workers' compensation.
- Delete next to the rate you want to delete.
- Select Yes, delete, or No, don't delete to cancel.
Assign a rate to an employee
To assign a workers' compensation rate to an employee:
- Go to Employees.
- Select the employee whose workers' compensation rate you need to add.
- Scroll down to the Workers' compensation section. Select Edit ✎.
- Select the rate from the list then select Save.
Calculate a rate based on a paycheque
After you assign a rate to an employee, the rate is multiplied by the employee’s workers’ compensation (CNESST) assessable earnings.
All pay types (with the exception of reimbursements) are considered workers’ compensation assessable earnings.
If you edit the CPP/QPP and/or EI/QPIP amount to a higher number which puts the net pay into the negative, the payroll calculator will auto-calculate the CPP or EI amount back down to a figure, which would make net pay equal to zero ($0).
If you have normal CPP/QPP deductions of $100 per payrun and you edit the CPP/QPP to $50 for one paycheque, the subsequent payrun will continue to default to a $100 deduction. In other words, the $50 edit to one paycheque will not stick for future ones.
Sample calculation
Note: Values shown below are for demonstration purposes only and might not reflect the current rates as outlined by CRA or each province.
In this example we assign the workers’ compensation (CNESST) rate of 3% to an employee. The employee had the following earnings on their last paycheque:
| Regular pay | $1,000 |
| Overtime | $200 |
| Commission | $300 |
| Reimbursement | $50 |
| Total Pay | $1,550 |
| Total Workers’ comp assessable earnings | $1,500 |
| Workers’ compensation rate | 3% |
| Workers’ compensation premium | $45 ($1,500 x 3%) |
| CPP rate | 5.10% (matched exactly by the employer) |
| CPP premium | $76.5 ($1,500 x 5.10%) |
| EI | 1.62% (employer matches 1.4 times, at 2.268%) |
| EI premium | $24.3 ($1,500 x 1.62%) |
Accounting treatment
- CNESST is included with all other Quebec Taxes (Quebec provincial tax, QPP, QPIP, QHSF) in your chart of accounts.
- Quebec taxes expense and Quebec taxes liability is debited and credited after each pay run respectively.
- Ontario taxes expense (WSIB) and Ontario taxes liability (WSIB) is debited and credited after each pay run respectively
- BC taxes expense (WSBC) and BC taxes liability (WSBC) is debited and credited after each pay run respectively
Payroll tax centre
CNESST is included with all the other Quebec Taxes (Quebec provincial tax, QPP, QPIP, QHSF) in the Quebec Taxes summary when reviewing your liability balance, recording payment and reviewing the TPZ-1015.
WSIB and WSBC liabilities will be tracked in the Payroll tax centre under Ontario Taxes and BC Taxes respectively. Here you can review your Workers' comp liability balance and record payments when made.
To change the remittance frequency for your Workers' compensation payments at any time, go to the Gear icon, select Payroll Settings then the Overview tab and then select Quebec taxes / Ontario taxes / BC taxes depending on the province you want to adjust the remittance frequency for.