What you owe when a subcontractor owes the WSIB

Last reviewed 27 August 2026. Ontario. General information, not legal advice.

If a contractor you hired has not paid the WSIB, the board can look to you for it. The exposure is capped, and the cap is larger than most people expect.

The rule

Section 141 of the Workplace Safety and Insurance Act, 1997 puts a duty on a principal, meaning the business doing the hiring, to make sure the contractor it hires has met its obligations to the WSIB. Where that does not happen and the contractor owes money, the WSIB's policy says the principal may be liable for the unpaid premiums and other outstanding amounts,

up to the value of the labour portion of the contract.

The amounts in question are not only premiums. Interest, service charges, experience rating surcharges, premium adjustments and non-compliance charges can all sit behind that number.

Working out the size of it

The cap is the labour portion, not the profit and not the margin. On a subcontract where most of the value is people rather than material, the labour portion is most of the contract.

Take a $400,000 drywall and taping subcontract. Material might be a quarter of it, so the labour portion is somewhere near $300,000. That is the ceiling on what the WSIB could look to you for if that trade has been running unpaid, and it is an amount you would be paying twice: once to the drywaller under the contract, and once to the board for the premiums the drywaller did not remit.

You are entitled to seek it back from the contractor. Whether that is worth anything depends on whether a business that could not pay the WSIB can pay you.

What a clearance does about it

A valid clearance closes the exposure for the period it covers. The WSIB's policy is explicit that issuing one waives its right to hold the principal liable for what the contractor owes, for that certificate's validity period.

Two things follow, and they are the reason this is an administrative problem rather than a legal one:

• The protection is time-boxed. A clearance covers a window of up to 90 days. Work that happened outside every window you hold a certificate for is work you have no waiver for. A certificate collected at onboarding and never refreshed protects the first quarter of a two year job and nothing after it.
• The protection is per contractor. Clearing the mechanical contractor says nothing about the electrician, and it says nothing about the people your mechanical contractor hired underneath them.

The offence, separately

Beside the money owed, working without the clearances the Act requires is an offence for both the contractor and the principal. The WSIB states the maximum fine on conviction of an offence under the Act as $100,000. Where a corporation commits an offence, directors and officers who knowingly authorised or permitted it can be personally guilty of it too, whether or not the corporation is itself prosecuted.

In practice the everyday risk to a general contractor is the premium liability rather than a prosecution. The fine is worth knowing about because it changes how the question reads to a board or an insurer.

What actually protects a general contractor

Not a folder. What answers the question, eighteen months later, in front of somebody who is not inclined to take your word for it, is a dated record showing the board's own response for each trade, covering each period work was done in.

That is a records problem, and it is the reason the four expiry dates matter so much: the gap between certificates is exactly the window you would be arguing about.

Sources

• Clearance Certificate, WSIB Operational Policy Manual, citing section 141 of the Workplace Safety and Insurance Act, 1997.
• Questions and answers: Clearances, WSIB.
• Offences and Penalties, WSIB Operational Policy Manual.