CFIB: WSIB Mandatory coverage "an attack on small construction firms"

March 28 2006 - The Canadian Federation of Independent Business (CFIB) has registered its strong opposition to today's announcement from Labour Minister Steve Peters that he intends to proceed with consultations on extending Mandatory WSIB coverage to owner/operators of construction firms, resurrecting an idea shelved with good reason by former Labour Minister Chris Bentley.

"This was a bad idea last year, and it hasn't gotten any better with age," said CFIB's Ontario vice-president Judith Andrew. "While the purported goal is to tackle the underground economy, this measure is an attack on small construction firms that are operating above board and paying more than their fair share of WSIB premiums."

She pointed out that the owners, directors and officers of firms that are already registered with the WSIB and operating in the 'aboveground' economy will be asked under this wrong-headed policy to immediately start paying more.

"Those who currently cheat the system, from the inside or from the outside - the true sources of the problems - will remain beyond WSIB's reach, while the firms already subsidizing the cheaters will see the amount of their overpayment increase," said Andrew. "If WSIB cannot enforce the coverage that is currently mandated, how can merely announcing a more comprehensive mandate increase WSIB's enforcement capability? The likelihood is that mandatory coverage will cause more people and firms to dive further underground."

Andrew noted that supporters of Mandatory coverage have also suggested that the measure will bring in more WSIB premiums in the construction sector, but she disputes that claim. She pointed out that with Mandatory coverage, WSIB will have brought tens of thousands of potential claimants into its fold that are their own employer - owners, directors, officers and true independents, enabling them to use the WSIB system as an income safety net.

"WSIB does not have the resources required to make sure that each claim made by members of this group is an actual injury; that it actually happened at work; that the injury is ongoing, or, that the claimant doesn't continue working under the table while receiving benefits," said Andrew. "It is in recognition of this sort of problem, for example, that the Employment Insurance Program does not permit an employer or an independent to participate in the EI program, even on an optional basis. It won't even let an employer's relatives participate."

"The only way to truly tackle the underground economy in the construction, or any other sector, is to move to a named insured system," Andrew concluded. "Our members want the cheating dealt with properly. Mandatory coverage is just another in a series of attempts by the WSIB to extend its reach, while simultaneously playing into the hands of big business and big unions in construction who would not be heartbroken if their smaller competitors were wiped out with this policy."

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