View Full Version : Workers Comp
I have been informed that if you are looking to take on an E2 business that has 4 or more employees you need workers comp . This i am told is very expensive and difficult to get .
1.first of all what is workers comp ?
2.does this apply to part time and full time workers ?
3.how much does it typically cost ?
Thankyou .
I am sure Julie (Esprit) will be able to help you with this query as I know she had to get workers comp for her new business last summer.
Workers comp covers you in case one of your employees has an accident in the workplace and claims compensation. It is needed if you have more than 3 employees though the owners can exempt themselves. In consruction and that includes pool repairs as my friend found out to her cost, it is needed with more than one employee, The rate depends on how risky the job is seen as being with high risk jobs having a higher premium. In some high risk areas, where there are a lot of claims, it is virtually impossible to get an insurance company to cover you for workers comp at all. This is a real problem in California and Florida. The reason is the high level of claims from low paid immigrant workers who soon discover that they can "hurt their back" and get more in a workers comp payment than they would earn in two years. Believe it or not commercial cleaning was seen as high risk. Only four insurers in Florida will cover this for workers comp and all of them turned us down as a new business with low paid mainly part time workers and no previous experience of cleaning. We panicked as the back up is the Florida state run scheme which is a premuium of 30% of payroll. We eventually got it only by joining a retail cooperation ( we get dividends like the co-op!) and using their own scheme which is members only. Janitorial workers comp is about 11% of payroll. We heard that for roofers, the workers comp payment is 100%!!!!
Yes it applies to full and part time workers, in fact it is harder to get it with part time workers as they are seen to have less to lose if they make a claim. All of this came as a big shock with 11 employees and a fair size payroll as we knew nothing about it previously but at least we got it as we would not have been allowed to run at all without it. The payroll is audited quarterly and the premium adjusted as it is a percentage. Our payroll has dropped so I guess our premium will go down this quarter.
Thankyou again .
When you say , for example 30% of payroll , that is 30% of the wages paid to all employess , doesnt matter if they are part time or full time ?
You say that the payroll is audited quarterly and the premium adjusted , how does this work - do you have to report quartely to the insurance company of you wages for that month and projected months ?
Who decides your % to pay and number of employess where it is neeeded for business type , where can you find what the % is for each business type and the number of employees where it is required for each business type ?
Doesnt matter whether they are full or part time. Most of mine are part time, only working 4 or 5 hours a night.
They ask you to submut your quarterly report which shows how much wages and how much tax has been paid. Mine is generated by the payroll company I use. They also reserve the right to audit annually. Initially they will ask for an estimate or take the previous quarter if you buy a trading business. Percentahe calculations are complicated as all businesses get a code. And the code will have a percentage against it. Asking a broker will be the only way to find out. If you search on workers comp, hundreads of them come up!