If WorkSafeNB audits your business, you must cooperate and provide accurate financial records, including your general ledger, T4 summaries, and subcontractor invoices. Audits are standard procedure to verify your payroll estimates, and you have up to 90 days to request a review from the Decision Review Office (DRO) and a full year to appeal to the Appeals Tribunal.
Receiving an audit notification from a government agency is enough to cause anxiety for any business owner in New Brunswick. However, if your construction firm in Moncton, your restaurant in Saint John, or your logistics company in Edmundston is selected for a WorkSafeNB audit, it is important not to panic. These audits are a routine part of maintaining a fair collective liability system.
WorkSafeNB conducts hundreds of audits annually to ensure that all employers in the province are paying their fair share of premiums and that independent contractors are classified correctly. 📊 An audit does not necessarily mean you are suspected of fraud; it simply means the board wants to verify that the payroll estimates you submitted align with your actual financial reality. If you are concerned about massive discrepancies or misclassified workers, retaining a knowledgeable corporate lawyer or a Chartered Professional Accountant (CPA) can help protect your interests during the review.
Step-by-Step Process in New Brunswick
Understanding the audit procedure removes much of the stress. The auditor’s primary goal is to reconcile your reported assessable earnings with your official Canada Revenue Agency (CRA) tax filings. Prepare diligently by following these steps.
Step 1: Review the Audit Notification Letter
You will receive formal written notice indicating that your business has been selected. This letter will clearly state the specific years being audited (usually the past one to three years) and provide a strict deadline to submit your documentation. 📧 Read this carefully to understand the exact scope of the auditor’s inquiry.
Step 2: Gather Payroll and Tax Documents
The auditor will require concrete proof of your financial output. You must gather your T4 and T4A summaries, your company’s general ledger, payroll registers, and your CRA corporate tax returns. Ensure that the gross wages listed in your accounting software match the numbers you previously submitted on your WorkSafeNB annual Form 100.
Step 3: Collect Subcontractor Clearances
One of the most common ways businesses lose money during an audit is by failing to prove their subcontractors had their own coverage. Gather all invoices from independent contractors and, most importantly, match them with WorkSafeNB Clearance Certificates from the exact dates the work was performed. 📄 Without clearances, the auditor will classify those contractors as your employees and charge you retroactive premiums for their labour.
Step 4: Participate in the Audit Meeting
Audits are typically conducted remotely via a secure portal where you upload documents, but they can occasionally involve an in-person or virtual meeting. Be professional, answer questions directly, and do not volunteer unnecessary information. Your accountant or lawyer can act as your authorized representative during this communication.
Step 5: Review the Final Audit Report
Once concluded, the auditor will issue a findings report. If your original payroll estimates were accurate, no further action is required. If discrepancies are found, you will receive an adjusted Assessment Notice detailing the additional retroactive premiums, interest, or administrative penalties you now owe under the Workers’ Compensation Act. 💰
How Much Does it Cost in New Brunswick?
There is no direct fee charged by WorkSafeNB to conduct the audit. The costs you face are entirely dependent on the findings and the professional help you hire.
| Expense / Consequence | Estimated Cost (CAD) |
|---|---|
| Government Audit Fee | $0 (Free) |
| CPA / Bookkeeper Preparation | $400 – $1,200+ |
| Lawyer Representation (Complex cases) | $1,500 – $3,500+ |
| Retroactive Premium Adjustments | Varies (Difference between paid and actual) |
Be aware that if the auditor determines you intentionally hid payroll to avoid paying premiums, you could face severe quasi-criminal fines under the provincial Workers’ Compensation Act. 🚨
How Long Does the Process Take?
WorkSafeNB usually provides 2 to 4 weeks’ notice before the deadline to submit your documents. Once the auditor receives all required files, the actual review process generally takes 1 to 3 weeks. After receiving the final decision, if you disagree with the premium adjustments, you have up to 90 days to request a review by the Decision Review Office (DRO). If you need to appeal a subsequent DRO decision, you have up to one year to file a formal appeal with the Workers’ Compensation Appeals Tribunal (WCAT).
Frequently Asked Questions (FAQ)
Why was my business selected for an audit?
Audits can be completely random. However, they are frequently triggered by data-matching discrepancies with the CRA, a history of late reporting, sudden drastic drops in your reported payroll, or tips from whistleblowers.
Can the auditor visit my workplace unannounced?
While WorkSafeNB health and safety inspectors can visit unannounced to check for hazards, financial payroll audits are almost always scheduled in advance, giving you time to prepare your records.
What happens if I lost my old payroll records?
Under New Brunswick law, you are required to maintain payroll records for several years. If you cannot produce them, the auditor has the legal authority to estimate your payroll based on industry averages, which usually results in highly inflated premium bills.
Can I appeal the auditor’s findings?
Yes. If you believe the auditor made a mathematical error or wrongly classified an independent contractor as an employee, you can submit a Request for Review to the Decision Review Office (DRO) within 90 days of receiving the decision. If you are unsatisfied with the DRO’s final decision, you then have up to one year to appeal to the Workers’ Compensation Appeals Tribunal (WCAT).
Do I have to pay the new premium bill immediately if I am appealing?
Generally, yes. Filing an appeal does not automatically pause your obligation to pay the assessed amount. If you win your appeal, WorkSafeNB will refund the overpayment or credit your employer account.
Leave a Reply