# Workmans comp



## rservices (Aug 3, 2005)

My company is rather small, on occasion I have someone help me. Maybe over a years time I pay 10.000 in wages to helpers. Some of my commercial accounts want me to provide insurance / WC info. Insurance is no problem and I have been able to wiggle around the W/C issue in the past, but I don't think I will be able to do this much longer.

My quote for W/C is around 5000 1st year, I don't know if that is in line or not I need to look around. But that is half of what I pay in these wages and it won't cover me unless I change my company's status.

Question.

Has anyone used a temp service, for payroll issues and W/C. I would bring my guy there and he would only work for me.

Ant help would be great


----------



## Randy Bush (Mar 7, 2011)

I looked into it once. But I found out that what ever I was going to pay in wages , say 10-15 an hour, it was going to cost me double that to pay the temp service. 
If you really need the help I think it might be the way to go. You are really take a big risk by not having WC on a worker. It could come back and bite you real bad. Scale back , hire temp or do it the right way with taxes and WC.


----------



## J F (Dec 3, 2005)

Listen to Randy.


----------



## Sir Mixalot (Jan 6, 2008)

Check with some of the payroll companies about pay as you go WC. 
I know that there are a few out there that offer that. Try PayChex if they are in your area. You need to cover your azz! :thumbsup:


----------



## RobertCDF (Aug 18, 2005)

Paychex wouldn't do work comp when I was looking (maybe that's changed) but I found a local PEO and I have used them for 5 years now, they handle it all and it's worth every penny. In fact I have them cover my payroll as well, then I know all taxes are filed properly and I get a direct deposit paycheck every 2 weeks with a w-2 at the end of the year. BTW I still have myself exempt from WC since I am the owner.


----------



## We Fix Houses (Aug 15, 2007)

Agree with the above 100%.

However ask about the minimum WC premium in your state. Most are between 900 - 1500 per year with comp rates for carpenters say 16% of payroll. The min would get you near the 10k your paying out to your subs / employees. (You have some other employment issues too)

The reason you get these high quotes is that the broker only gets about a 10% comm so they need to write a policy that is worthwhile to them. I have come across this a few times myself. I came across an agent who was honest with me about this but I needed to put my vehicle and home with them to make it work.


----------



## Rio (Oct 13, 2009)

See if your state has a Worker's compensation company they support (not sure if it's really support or how it works). In California for small companies there's *State Fund*. 

When we were running payroll the premiums started at less than a thousand dollars a year if I remember correctly.


----------



## Stephen H (Feb 18, 2011)

rservices said:


> My company is rather small, on occasion I have someone help me. Maybe over a years time I pay 10.000 in wages to helpers. Some of my commercial accounts want me to provide insurance / WC info. Insurance is no problem and I have been able to wiggle around the W/C issue in the past, but I don't think I will be able to do this much longer.
> 
> My quote for W/C is around 5000 1st year, I don't know if that is in line or not I need to look around. But that is half of what I pay in these wages and it won't cover me unless I change my company's status.
> 
> ...


 one of the best things I ever did ,was hook up with a good payroll service.
the payroll service IMMEDIATELY told me I was paying too much in workers comp. and that I needed to be part of a group.
Payroll service had me join( of all things!)- our counties farm bureau-trust me, I am very much a city boy!

anyhow-once I was a member of the farm bureau( which costs a couple hundred $ a year)- my workers comp rate dropped like a stone
the coverage comes directly from the state-and is based on a percentage of payroll( not a flat rate)
stephen


----------



## Sir Mixalot (Jan 6, 2008)

Stephen H said:


> one of the best things I ever did ,was hook up with a good payroll service.
> the payroll service IMMEDIATELY told me I was paying too much in workers comp. and that I needed to be part of a group.
> Payroll service had me join( of all things!)- our counties farm bureau-trust me, I am very much a city boy!
> 
> ...


Where are you located Stephen?


----------



## TxElectrician (May 21, 2008)

RobertCDF said:


> Paychex wouldn't do work comp when I was looking (maybe that's changed) but I found a local PEO and I have used them for 5 years now, they handle it all and it's worth every penny. In fact I have them cover my payroll as well, then I know all taxes are filed properly and I get a direct deposit paycheck every 2 weeks with a w-2 at the end of the year. *BTW I still have myself exempt from WC since I am the owner*.


why do you exempt yourself? If you were working for someone else wouldn't you expect to be covered? It is just a cost of doing business.

Two weeks ago, I severed the tendons in my thumb and required surgery. Last week, while doing what I considered light duty, I tore the stiches holding them together. I am scheduled for another surgery on Tuesday.

I carry health insurance, but since these injuries occurred OTJ, they would not be covered. I am thankful that I did not choose to exempt myself.

I understand that WC is expensive but we owe it to our families to make sure we are covered.


----------



## Astrix (Feb 23, 2009)

Every state has slightly different Workers Comp rules. According to the Wisconsin Workers Compensation website - found here - there is no state fund such as available in other states like California. W/C in Wisconsin is 100% provided by the private insurance market; approx. 300 insurers according to the website.

I also found this guide which might be helpful: Consumer’s Guide to Worker’s Compensation for Employers - State of Wisconsin



> *I’m a small risk with very little payroll and I have to pay a “minimum premium” which is just too high. Why?*
> 
> Minimum premiums in Wisconsin are established for each classification by the WCRB and approved by the Commissioner of Insurance. The minimum premiums cover the expense of issuing a policy with a nominal amount available for losses. Classifications with lower rates have lower minimum premiums and classes with higher rates have higher minimum premiums. Generally the minimum premium is based on an annual payroll of $17,000 which is less than half of the average annual wage for one employee in Wisconsin. As the state average annual wage increases, so do minimum premiums subject to the applicable maximum. Currently the minimum premium is capped at $900.
> 
> Wisconsin is the only state to have a “minimum-minimum premium” rule. This special rule provides that the minimum premium can be adjusted at the end of the policy whenever the minimum premium is greater than 20% of the actual earned payroll of the employer. In those cases, the final applicable minimum premium is limited to 20% of the earned payroll, but not less than the policy expense constant which is currently $220.


Did the insurance broker who quoted you 50% ($5,000 premium on $10,000 payroll) explain this to you? This is something that a Wisconsin broker selling W/Comp coverage should know, and plan to get this credit adjustment for you at the appropriate time if you are eligible. 

I understand that many insurance brokers may not want to bother with one small W/Comp policy, however, I was surprised to read that one openly stated that they would only arrange the policy if the client's other insurance was placed with them. In Canada, tied selling (also called coercive selling) is illegal and I believe similar rules exist in the USA.

If a payroll service can do a better job of providing you with W/Comp coverage and advice than an insurance broker/agent, then go with it.


----------



## Sir Mixalot (Jan 6, 2008)

TxElectrician said:


> why do you exempt yourself? If you were working for someone else wouldn't you expect to be covered? It is just a cost of doing business.
> 
> Two weeks ago, I severed the tendons in my thumb and required surgery. Last week, while doing what I considered light duty, I tore the stiches holding them together. I am scheduled for another surgery on Tuesday.
> 
> ...


Yep. That's why I'm on my WC policy. :thumbup:


----------



## Warren (Feb 19, 2005)

I say the same thing. My first year paying wc was $40000. I chose to cover myself because I would have felt really stupid if everyone else was covered, and then I got hurt.


----------



## BamBamm5144 (Jul 12, 2008)

Wisconsin workers comp is lame!


----------



## Stephen H (Feb 18, 2011)

Sir Mixalot said:


> Where are you located Stephen?


Ohio


----------



## Stephen H (Feb 18, 2011)

TxElectrician said:


> why do you exempt yourself? If you were working for someone else wouldn't you expect to be covered? It is just a cost of doing business.
> 
> Two weeks ago, I severed the tendons in my thumb and required surgery. Last week, while doing what I considered light duty, I tore the stiches holding them together. I am scheduled for another surgery on Tuesday.
> 
> ...


 I cut my hand at work a few weeks ago(thank you AirVent for manufacturing such absurdly sharp dome covers on your power fans!)
my health insurance picked up the whole tab except for $50.
I don't cover my self via workers comp-because I am covered in other ways.
stephen


----------



## RobertCDF (Aug 18, 2005)

TxElectrician said:


> why do you exempt yourself? If you were working for someone else wouldn't you expect to be covered? It is just a cost of doing business.


1st thing, I can't hurt myself much in the office and making sales calls. 
2nd thing, I'm covered in other ways, including disability insurance if the need where to arise.


----------



## Warren (Feb 19, 2005)

Stephen H said:


> I cut my hand at work a few weeks ago(thank you AirVent for manufacturing such absurdly sharp dome covers on your power fans!)
> my health insurance picked up the whole tab except for $50.
> I don't cover my self via workers comp-because I am covered in other ways.
> stephen


Did you happen to tell them that this happened at work?


----------



## Stephen H (Feb 18, 2011)

Warren said:


> Did you happen to tell them that this happened at work?


 absolutely,
they asked if this took place in the work place- I replied"yes, but I am self employed so workers comp isn't involved"

end of story!
stephen


----------



## DavidC (Feb 16, 2008)

Stephen H said:


> I am very much a city boy!


That's not much of a compliment around these parts.:>)

OP, you were probably quoted a high starting premium because you are a new unknown to the provider. We were audited quarterly for the first year with our policy and the premium was adjusted each time. In the end, you only pay for what you use, but the first down payment was high.

The temp services are usually a bit more expensive but may be well worth the cost for a small payroll. A lot to be said for letting them earn the money while you go to work.

Our business is going to be looking into PayChex before our WC policy renews this year. I have heard that they offer pay as you go in our area. Our current coverage is a couple thousand down followed by 9 monthly pays with an audit/adjustment at the end. Since we are usually overpaid we're thinking it be wiser to redirect that cash flow sooner.

Good Luck
Dave


----------

