Are you a business owner? Are you prepared for an employee injury or illness at work? Life happens and unexpected accidents can really throw off not just the employee but also the employer. Do you know what you can do to help yourself reduce Workers’ Compensation costs? Sounds like a lot of work? Well it is actually easier than you think. Use the following 5 tips to help you keep your premiums low.
How to Reduce Workers’ Compensation Costs:
1. To avoid paying unnecessary premiums from a carrier audit, ensure that owners are properly excluded on the policy. Carriers have been known to charge for spouse’s payroll in some cases, due to the fact that they were not specifically excluded on the policy.
2. If your business is a corporation and you plan to exclude owner/officer payroll on your workers’ compensation policy, make sure that all shareholders are officers of the company. If not all shareholders are officers, and by California law, the carrier can charge premium for all shareholder payroll of those collecting a company income.
3. Ensure your employees are properly classified and you are not overpaying premiums based on an incorrect class code. You can verify by contacting the Workers’ Compensation Insurance Rating Bureau (WCIRB – http://www.wcirb.com/) and describing the employee job duties.
4. Under the OSHA Act, employers are responsible for providing a safe work environment for their employees. They are required to provide training to employees and are encouraged to adopt an Injury and Illness Prevention Program (IIPP):
a. An IIPP can help cut down in the quantity and severity of injuries in the workplace, thus resulting in lower workers compensation premiums.
5. California employers (even those that only have one employee) are required to post up to date employment notices and distribute certain labor law pamphlets. Posters must be hung at each business location where employees can easily read it (such as break rooms, etc.). OSHA has the ability to issue fines to those that do not comply with these requirements. Compliance posters and pamphlets can be purchased through the Cal Chamber website at http://store.calchamber.com/.
Accidents and illness happen all the time. As an employer are you ready? Make sure you are prepared for workers’ compensation costs, and know your policy inside and out. Check class codes, set an IIPP, and avoid paying unnecessary premiums. Post your labor law information in a highly visible location for all employees to see, so they too are aware of your company policies. Use these five tips to help keep a safer work environment and keep your premiums low.