1. Classify Your Employees Correctly
It is important to have your employees classified properly from the beginning, since incorrect classifications may result in a reclassification at your final audit, and could result in a large, unexpected expense.
Classifications are governed in California by the Workers Compensation Insurance Rating Bureau, "WCIRB", and in most other states by the National Council on Compensation Insurance, "NCCI".
If you feel your employees are incorrectly classified, a request for a classification inspection can be processed to either the WCIRB or the NCCI through your current Broker / Insurance Company.
2. Keep Accurate Payroll Records
One of the functions of the workers compensation auditor is to be sure all payroll (W2 and 1099) is properly classified. If, for example, you have payroll for "clerical employees" combined with your payroll for a higher or more expensive classification, such as in-home caregivers, you may be forced to pay the higher rate for all payroll. It is so important to keep clear, precise payroll records.
In addition, if you currently utilize independent contractors and pay them via 1099*, you must be able to show the auditor that the 1099 individuals are covered under another workers compensation policy, or the auditor will be required to include all the 1099 remuneration in your audit.
*Before you decide to classify any of your workers as Independent Contractors, you may wish to visit our "employee or independent contractor" page for more information.
3. Monitor Your Claims!
Be sure you know what claims are on your policy, and be sure to communicate with your broker / claims adjuster. This is important because your losses (both paid and reserve) are included in the experience modification calculation, and could have an effect on your workers compensation cost for years.
4. Have Us Quote Your Coverage!
Since we specialize in the Homecare & Hospice industries, we have multiple insurance companies that are willing to write your workers compensation insurance, and even though the coverage and policy language is regulated by law, pricing can vary greatly. It doesn't take much of your time to obtain a quotation, and this could be the most effective thing you do to reduce your workers compensation expense!