Payroll- Workers Comp

As most business owners know, your workers compensation premium is calculated using your company’s payroll data. BUT did you know that there some things that could be excluded from that calculation? There are certain things that shouldn’t be used to calculate a workers compensation premium, but they are often overlooked and remain in the company’s payroll data, and may be increasing your premium.

Here are a few payroll exclusions that could save you money if their removed:

  • Overtime (applicable to general liability only)
  • Tips or other gratuities received by employees
  • Additional payments paid by the employer through payroll for employee group health, or to purchase health insurance elsewhere
  • Payments by an employer into third-party trusts for the Davis-Bacon Act or a similar prevailing wage law
  • Payroll for special rewards for individual invention or discovery
  • Dismissal or severance payments except for time worked or vacation accrued
  • Payments for active military duty
  • Employee discounts on goods purchased from the employee’s employer
  • Expense reimbursements to employees, to the extent that an employer’s records confirm that the expense was incurred as a valid business expense

There are even more exclusions besides these! It’s a good idea to review what payroll information is being included in the calculation of your work comp. If some of these exclusion are there, you are probably paying too much for your workers compensation premium.

The Seltzer Group, located in Eastern Pennsylvania, specializes in developing safety, workers compensation, human resources, claims, and risk financing programs. They are a proud member of the Keystone Insurers Group and are nationally recognized for their expertise in workers compensation solutions. The Seltzer Group serves businesses and individuals locally, regionally, and on the national level.

Payroll- Workers Comp was last modified: August 26th, 2014 by Sarah McGorry