Common Workers Compensation Mistakes by Employers
Buzy Bodies Inc has been providing off site human resource solutions in Southern California for over 14 years. The area of contention in the majority of companies is workers’ compensation insurance. In this multi topic subject we will cover mistakes employers make when it comes to W.C. Insurance.
There are two common workers compensation payroll mistakes an employer may make. Both have an associated cost that affects the employer in different ways.
- The first is underestimating the projected annual payroll. As workers compensation premium is directly related to the estimated payroll, any underestimating of payroll at the beginning of the policy period will at audit result in an additional premium due. Many times this is a large additional amount due that comes to the employer as a surprise.
What happens when an employer underestimates his payroll? Here’s a couple of items to consider:
- Exposes the business to a large additional premium due at audit.
- Inefficient use of premium funds in that a potential large audit bill will be due in full rather than making payments in installments over the active policy period.
- The second common payroll mistake is overestimating the policy period payroll. When workers compensation payroll is overestimated, the employer in fact overpaid his pemium. He will get back at the audit. In addition he will not have access to his overpayment funds until the audit. Do not let the insurance company hold onto your funds.
Estimating the proper payroll projections from beginning of the policy period may seem a difficult process but a process in which an employer will be rewarded for accuracy.
For all your human resources needs and requirements consider Buzy Bodies Inc at www.buzybodiesinc.com or check out our job board at www.jobsannex.com We are here to help with your employee issues. Underestimates and overestimates both create unfavorable situations for the employer.