Ontario's general minimum wage moves from $17.60 to $17.95 an hour on October 1, 2026 — a $0.35, 1.9 percent increase confirmed by the province on April 1, 2026 under the Employment Standards Act's annual, inflation-linked adjustment formula. For Toronto-area employers, the increase itself is modest, but it lands in the same year as a lower WSIB premium rate and an unchanged Employer Health Tax exemption — three separate cost lines moving in different directions. This is a look at what each change actually means and how to budget for the October transition with about two months of runway.
The minimum wage increase, in detail
Ontario reviews and adjusts its minimum wage rates annually under the Employment Standards Act, with any change announced by April 1 and taking effect October 1 of the same year. The adjustment is tied to the Ontario Consumer Price Index, which is why the increase moves with inflation rather than a fixed political target.
Source: Ontario — Your Guide to the Employment Standards Act: Minimum wage.
For October 1, 2026, the confirmed rates are:
- General minimum wage: $17.95/hour, up from $17.60 (+$0.35, 1.9 percent)
- Student minimum wage: $16.90/hour (for students under 18 working 28 hours a week or less during school, or during a school break)
- Homeworkers' minimum wage: $19.70/hour
- Hunting, fishing and wilderness guides: $89.75/day for under five consecutive hours worked, or $179.50/day for five or more hours
The province estimates the change benefits more than 700,000 Ontario workers, and that a minimum-wage employee working 40 hours a week will see roughly $728 more per year once the new rate is in effect for a full year.
Why the two-month runway matters
An October 1 effective date sitting mid-fiscal-year for most Toronto businesses means the increase does not simply replace a line in a January budget — it requires a mid-year payroll table update and, for many employers, a look at wage compression above the new floor. Staff currently earning $17.95 to roughly $19 an hour will suddenly be earning at or barely above the new minimum, which puts pressure on differentials that were set when the floor was $17.60. Employers who wait until October 1 to think about this tend to make reactive, inconsistent adjustments; employers who map the compression now can plan a deliberate, affordable response.
The practical steps between now and October 1:
- Identify every role currently paid below $17.95. These wages must move on October 1, with no grace period.
- Map the compression band above $17.95 — typically staff earning up to $1–2 above the new floor — and decide in advance whether and how much to adjust to preserve pay differentials.
- Update payroll systems and any wage-based scheduling or costing tools ahead of the October 1 pay period that straddles the change, not on the day itself.
- Flag any student, homeworker, or guide-classification staff, since those sub-minimums move by the same schedule but different dollar amounts.
WSIB premiums are moving the other way in 2026
While the minimum wage is rising, Ontario's Workplace Safety and Insurance Board (WSIB) reduced its average premium rate for 2026 to $1.23 per $100 of insurable payroll, down from $1.25 in 2025. WSIB describes this as the seventh consecutive annual reduction and the lowest average rate in over 50 years, with the cut expected to save Ontario employers roughly $60 million in 2026. Since 2017, the average premium has fallen by more than 50 percent, contributing to an estimated $21.5 billion in cumulative employer savings when combined with prior surplus distributions.
Source: WSIB — WSIB reduces average premium rate for Ontario businesses.
Two details matter more to an individual employer than the province-wide average:
- Individual rate movement is capped. If your business's projected premium rate would otherwise jump or drop sharply, WSIB limits the year-over-year move to a maximum of three risk bands (roughly 15 percent) from your prior-year band, phasing you toward your true projected rate rather than applying it all at once.
- The maximum insurable earnings ceiling rises to $121,700 for 2026, up from $117,000 in 2025 — meaning WSIB premiums now apply to a larger slice of higher earners' payroll, even where your classification rate itself is stable or falling.
Source: WSIB — 2026 premium rates.
Individual 2026 premium rate statements become available through WSIB's website in November — a useful moment to reconcile the province-wide average against what your business is actually paying, rather than assuming the headline decrease applies to you in full.
The Employer Health Tax exemption holds steady
The third payroll cost line for 2026 is the one that isn't changing: Ontario's Employer Health Tax (EHT) exemption remains at $1,000,000 for eligible private-sector employers (or associated groups of employers, who share a single exemption) whose total Ontario payroll is under $5,000,000. That exemption threshold is scheduled to stay fixed through 2028, with the next inflation adjustment set for January 1, 2029.
Source: Ontario — Employer Health Tax (EHT).
For a Toronto business tracking whether growth will push it past the exemption, or past the associated-employer group's shared $1 million threshold, this is useful stability: EHT exposure this year and next depends on your own payroll growth, not on a moving government threshold.
Putting the three changes together
None of these three changes is individually dramatic, but they move a Toronto employer's payroll cost stack in different directions at the same time:
- Minimum wage: a modest but mandatory increase, effective October 1, with a compression effect worth planning ahead of the date.
- WSIB premiums: a modest average decrease for 2026, though your individual rate movement is capped and the higher earnings ceiling means more payroll is subject to premiums.
- EHT: unchanged for 2026, with the $1 million exemption locked in through 2028 — the one variable you can treat as fixed while you model the other two.
The right response is not to react to each change separately as it lands, but to build one October-dated payroll cost update that folds in the new minimum wage and any compression adjustments, and to check your WSIB rate statement against the new ceiling once it is published in November.
Key takeaways
- Ontario's general minimum wage rises from $17.60 to $17.95 on October 1, 2026 (+1.9 percent), with student, homeworker, and guide sub-minimums also increasing on the same date.
- Roughly 700,000 Ontario workers are affected; a full-time minimum-wage worker gains about $728 a year once the new rate is fully in effect.
- Map wage compression above $17.95 now — the two months before October 1 are the time to plan differential adjustments, not react to them.
- WSIB's average 2026 premium rate falls to $1.23 per $100 of insurable payroll, but individual rate changes are capped at three risk bands a year, and the insurable earnings ceiling rises to $121,700.
- The EHT $1 million exemption is unchanged for 2026 and locked in through 2028, giving employers one stable variable while the other two move.
If you want your Toronto or Ontario payroll budget rebuilt around the October 1 minimum wage change, your WSIB position, and your EHT exposure before the transition lands, RN Canada works with Ontario employers remotely from our Edmonton and Vancouver offices to turn these moving parts into one clean plan.