Payroll Penalties and Interest
Employers have a variety of obligations under The Workers Compensation Act. To ensure the compensation system works smoothly and efficiently it’s important that employers fulfill these obligations. To respond to cases where an employer fails to comply with their responsibilities, the Act includes provisions for both fines and penalties. The Administrative Penalty Regulation (71/2021) sets out the penalty levels. The Interest and Financial Matters Regulation (123/2021) sets out the interest rates that the WCB may charge or pay on accounts.
The following administrative penalties can be charged by the WCB for infractions related to payroll reporting:
|
Name of Penalty |
Infraction |
Amount of Penalty |
|
Late Filing Penalty |
WCB does not receive required payroll information by the due date. |
5% of current year's premiums up to a maximum of $5,000. |
|
Non-Filing Penalty |
WCB does not receive required payroll information. |
10% of current year's premiums up to a maximum of $5,000. |
|
Under-Reporting Actual Payroll |
WCB audit has revealed a substantial under-reporting of actual payroll figures. |
15% of the difference in premium between the audited and actual payroll up to a maximum of $5,000 |
Interest
The WCB may also charge or pay interest on accounts where there is a difference of more than 25% between your business' under or overstated payroll estimate and the actual payroll submitted.
Please note, interest on inaccurate payroll estimates will not be charged or owing if:
- The charge amounts to less $50 for the year; or
- The credit is less than $10.
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