Ontario, Canada’s Workplace Safety and Insurance Board Closes the Second Injury and Enhancement Fund

Ontario employers have long relied on the Workplace Safety and Insurance Board’s Second Injury and Enhancement Fund (SIEF) as an important mechanism for reducing the financial impact of claims involving pre-existing medical conditions. Following a value-for-money review, the WSIB has now discontinued the program, marking a major change in Ontario’s workers’ compensation system. 

What Was SIEF? 

SIEF provided cost relief to Schedule 1 employers¹ where a worker’s pre-existing condition either contributed to a workplace accident or materially prolonged or enhanced the effects of a compensable injury. Historically, employers could seek a transfer of a portion of claim costs to SIEF where the evidence demonstrated a sufficient connection between a pre-existing condition and the resulting disability. Depending on the circumstances, employers could receive substantial cost relief, sometimes reaching 100% of claim costs.

The New Policy 

The WSIB has amended its operational policy to provide that SIEF is closed retroactive to June 16, 2026. As a general rule, the Board will no longer grant cost relief in claims where relief had not already been provided before the June 16, 2026, cutoff date. Similarly, previously awarded relief will not be adjusted after that date except in limited circumstances set out in the policy or through the appeal process.

The WSIB has established transitional or "wind-down" provisions for existing claims. In particular, the Board will continue to process and determine SIEF requests that were submitted before the applicable cutoff date and will continue to recognize relief already granted in those claims. Existing SIEF transfers will also continue to be considered within the premium-setting process where applicable.

Implications for Employers 

The most immediate consequence is that employers may now bear a greater proportion of claim costs in cases involving pre-existing conditions. Claims that previously may have qualified for a significant cost transfer will remain fully allocated to the employer's experience record.

Without SIEF relief as a safety valve, proactive claims management will become increasingly important. Employers should focus on:

• prompt accident reporting;
• early collection of medical and factual evidence;
• active participation in return-to-work planning;
• careful review of entitlement decisions; and
• timely appeals where claim entitlement or duration appears unsupported by the evidence.

Employers may also need to consider if other existing WSIB policies that address pre-injury impairment should be relied on to challenge entitlement to benefits.

The transition from the SIEF regime is likely to generate litigation concerning cutoff dates, pending applications, adjustments to previously granted relief, and the interpretation of transitional provisions.

Key Takeaways 

The closure of SIEF marks the end of a cost-relief program that had existed in one form or another for decades. Employers are likely to experience increased exposure to claim costs where pre-existing conditions contribute to disability outcomes.

Going forward, organizations should consider placing renewed emphasis on claim monitoring, evidence development, return-to-work management, and strategic appeals. In the absence of SIEF, these tools may become the primary means of limiting the financial impact of complex workplace injury claims.

For employers with existing SIEF applications, pending appeals, or questions regarding the applicability of the WSIB's transition provisions, obtaining legal advice promptly may be prudent to ensure potential rights and cost-relief opportunities are preserved.