2016 Workers Compensation Audit Application Instruction Booklet

Transcription

1 2016 Workers Compensation Audit Application Instruction Booklet l

2 TABLE OF CONTENTS Section Description Page Section I Payroll and Employee Data Full Descriptions...2 Section II Definition of Payroll...3 Section III Splitting One Position into More than One Class Code... 5 Section IV Fire, Police, Ambulance, Search and Rescue Volunteers Unpaid Elected and Appointed Officials...6 Section V Affiliated Legal Entities... 7 Section VI Independent Contractors vs. Employees... 8

3 Section I CLASSIFICATION CODE FULL DESCRIPTIONS Class Code Description 0042 Landscape and Gardening New Installations (laying out of grounds) 1463 Asphalt Works and Drivers Grinding, Pulverizing or Mixing Asphalt 4361 Photography including Video Taping and Photo Processing 5192 Voting Machine Repair and Parking Meter Repair 5437 Carpentry including Interior Carpentry Finish or Trim 5506 Street, Road, Bridge Construction and Repair 6217 Excavation Operations (include Payroll for Excavation performed during Water and Sewer Line Construction in 7520 or 7580) 6325 Street Lighting and Traffic Signal Construction or Repair (Outside) 6826 Marina Sale or Repair of Boats or Engines or Operation of Boat Docks 7370 Ambulance Drivers Paid 7380 Drivers Not Otherwise Classified including Parking Meter Readers (bike or motor), Library Bookmobile 7382 Transportation All Transit Bus Workers including Drivers 7403 Airport or Helicopter Operations Ground Crew 7502 Gas Utilities All Employees including Meter Readers 7520 Waterworks Operations All Operations including Installation, Construction, Repair/Maintenance of Water Mains, Pipes, Taps and Meters; Meter Readers 7539 Electric Department All Employees including Meter Readers 7580 Sewage Disposal Plant Operations All Operations including Installation and Repair of Sewage Lines 7590 Garbage Works including Reduction, Incineration and Land Fill (include payroll for Drivers in 9403) 7710 Firefighters and Chief 7711 Firefighters Paid and Unpaid Volunteers 7719 Search, Rescue, Disaster and Ambulance Teams Paid and Unpaid Volunteers 7720 Police Officers, Chief, District Attorney, Investigators with Police Power, Sheriff s Posse, Jail Employees, Traffic Controllers, Armed Guards, Airport Security Personnel 7720a Paid Police Officers Volunteers, Reserves and Teams 7720b Unpaid Police Officers Volunteers, Reserves and Teams 8292 Civil Defense Storage Warehouse 8380 Garage used for Municipal Vehicle Maintenance 8601 Field Engineers and Surveyors 8742 Case and Social Workers, Claim Adjusters, Loss Control Representatives 8810 Clerical and Office Employees including, but not limited to, Accountants, In-House Attorneys and Paralegals, Professional Library and Museum Employees, Judges, Drafting Employees, and Police Dispatchers 8810a Paid Elected Council, Trustees, and Officials 8810b Paid Appointed Boards, and Commissions 8811 Unpaid Elected Council, Trustees and Officials 8811a Unpaid Appointed Boards and Commissions 8831 Animal Control 8868 Child Day Care Professionals and Clerical 9015 Building Management, Maintenance, Unarmed Watchmen 9016 Fair Ground and Amusement Park Employees, Ice and Roller Skating Rink Employees 9052 Hotel All Employees 9060 Golf Club All Operations 9082 Restaurant and Food Service Employees including Musicians and Entertainers 9102 Parks, Recreation, or Zoo Operations All Employees including Swimming Pool Employees & Lifeguards 9154 Theater All Employees Except Musicians, Actors and Entertainers 9156 Theater Musicians, Actors and Entertainers 9180 Ski Trail Maintenance Operations including Employees engaged in Ski Lift Operations 9220 Cemetery All Operations 9402 Street Cleaning and Snow Removal 9403 Garbage, Ashes or Refuse and Recycling Collection including Drivers 9410 Not Otherwise Classified Office and Field Work including but not limited to Public Works Directors, Building and Electric Inspectors, Tax Assessors, Parking Meter Readers (walking only), Field Geologists, and Health/Mine Inspectors 2

4 Section II DEFINITION OF PAYROLL A. Payroll includes: 1. Payroll/Gross Salary before deductions, except for payments by an employer to voluntary group insurance or group pension plans; 2. Commissions; 3. Bonuses; 4. Overtime; a. Overtime means those hours worked for which there is an increase in the rate of pay, such as; (1) for work in any day or in any week in excess of the number of hours normally worked; (2) for hours worked in excess of 8 hours in any day, or 40 hours in any week; (3) for work on Saturdays, Sundays or holidays. Overtime hours should be converted to straight-time. In the case of guaranteed wage agreements, overtime means only those hours worked in excess of the number specified in such agreement. Forms of incentive pay commonly referred to as shift differential or premium pay associated with working other than normal day shift hours during the standard workweek are not to be considered overtime. 5. Pay for holidays, vacations or sickness; 6. Payment by an employer of the employees portion of the payment for statutory insurance or pension plans, such as the Federal Social Security Act (FICA) or PERA, etc. Employers that do not participate in FICA or PERA should include payments made by an employer for an employee to any retirement program that is a social security replacement program (401(a), 457, etc.). 7. Payments for salary reduction (401(a), 457, etc.), employee savings plans, retirement or cafeteria plans (IRC 125) that are made through employee-authorized salary reduction from the employee s gross pay. 8. Payment to employees on any basis other than time worked, such as piece work, profit sharing or incentive plans; 3

5 Definition of Payroll, continued 9. Payment or allowance for hand tools or power tools provided by employees and used in their work or operations for the entity; 10. The rental value of an apartment or a house provided for any employee based on comparable accommodations; 11. The value of lodging, other than an apartment or house, received by employees as part of their pay, to the extent shown in the employer s records; 12. The value of meals received by employees as part of their pay to the extent shown in the employer s records; and 13. The value of store certificates, merchandise, credits or any other substitute for money received by employees as part of their pay. B. Payroll does not include: 1. Tips and other gratuities received by employees; 2. Payments by an employer to voluntary group insurance or group pension plans for employees (health or life insurance), other than payments covered by commissions; 3. Employer contributions to salary reduction, employee savings plans, retirement, or cafeteria plans (IRC 125) Contributions made by the employer, at the employer s expense, that are determined by the amount contributed by the employee; or 4. Dismissal or severance payments unless they are for time worked or accrued vacation. This payroll description conforms with the National Council on Compensation Insurance (NCCI) guidelines. 4

6 Section III SPLITTING ONE POSITION INTO MORE THAN ONE CLASS CODE If the same person performs a number of different jobs, you may allocate that individual s salary according to the approximate percentage of time the employee devotes to each job category. You should also allocate the corresponding percentage of your full time, part time and seasonal employees when you break down their payroll by those job categories. Please refer the example below or contact your underwriting representative for assistance. Example: EXAMPLES 2 Full Time & 2 Part Time employees work in various categories, totaling $75,000/yr: 1 FT employee, $30,000 works in categories: 5506, 7502, 7520, 7539 and 9402; 1 FT employee, $25,000 works in categories: 5506, 7520, 9015 and 9402; 1 PT employee, $10,000 works in categories: 7502, 7539 and 9015; and 1 PT employee, $10,000 works in categories: 5506, 7539 and Divide payroll and employee time by employee name, break up by category then add total payrolls and employee times for respective categories: Let s take John first: Then, Mike: Code Payroll FT Code Payroll FT 5506 $ 6, $ 6, , , , , , , , $25,000 1FT $30,000 1FT Now, Sam: And finally, Joe: Code Payroll PT Code Payroll PT 7502 $ 3, $ 3, , , , , $ 10,000 1PT $ 10,000 1PT Next, sum the payroll from each person into its respective class code and employee categories: Code Description Payroll FT PT 5506 Streets $15, Gas 9, Waterworks 12, Electric 12, Building Maintenance 10, Parks 4, Street Cleaning, Snow Removal 12, $75,000 2FT 2PT The totals for these categories should add up to $75,000 in payroll, 2 in the FT employee column and 2 in the PT employee column. 5

7 Section IV FIRE, POLICE, AMBULANCE, SEARCH AND RESCUE VOLUNTEERS UNPAID ELECTED AND APPOINTED OFFICIALS The following information applies to volunteers that receive no payroll. See the definition of payroll beginning on page 3 of this packet for the definition of payroll. Generally, to qualify as an unpaid volunteer, the person can be paid nothing more than reimbursement of actual/documented expenses only. Only four classifications of unpaid volunteers are covered under workers compensation: 1. Volunteer firefighters; 2. Volunteer/Reserve Police Officers; 3. Members of search, rescue, disaster and ambulance teams; and 4. Elected or appointed officials*. *However, you may opt not to cover unpaid elected and appointed officials. These individuals are covered unless the entity opts them out for workers compensation coverages. To opt them out, all of the following are required: a. Your entity must be a county, city, town or irrigation, drainage or taxing district; and b. The officials must be uncompensated (they must not receive any pay that meets the definition of payroll/gross salary); and c. A resolution must be adopted by your entity s governing body; and d. The appropriate forms must be filed with the Division of Workers Compensation not less than 45 days prior to policy implementation (i.e., by no later then November 15 for an effective date of January 1) along with the ordinance or resolution of the entity s governing body; and e. Each official must be informed in writing of this action at the time it is taken. If you indicate on your application that you choose to opt out of coverage for you entity s unpaid elected and/or appointed officials, CIRSA will provide you with copies of all of the necessary paperwork. 6

8 Section V AFFILIATED LEGAL ENTITY PAYROLL AND EMPLOYEE DATA If any of YOUR employees work for an Affiliated Legal Entity controlled by your entity and you wishes to cover those employees under this policy, list the Affiliated Legal Entity for which they work and classify the employees and their payroll into their respective class codes and job descriptions. (Example: an urban renewal authority created by a municipality.) The employees must be on YOUR payroll in order for YOUR workers' compensation coverage to be applicable. i.e. they must be paid under your entity s Federal Employer Identification Number (F.E.I.N.), be covered under the same benefits plan structure and be subject to the same employee rules and regulations. If the employees are on the payroll of the affiliated legal entity, they are not YOUR employees; in such case, the affiliated legal entity is responsible for obtaining its own workers' compensation coverage and for covering its employees. 7

9 Section VI GUIDELINES FOR DETERMINING WHETHER AN INDIVIDUAL IS AN EMPLOYEE OR AN INDEPENDENT CONTRACTOR FOR PURPOSES OF WORKERS COMPENSATION COVERAGE The definition of an employee for purposes of workers compensation coverage may be broader than for other purposes. Thus, the mere labeling of an individual as an independent contractor by the individual or the entity may not necessarily be determinative of employment status for workers compensation purposes. There are statutory criteria, in C.R.S (2), to assist in determining whether an individual should be classified as an employee or an independent contractor for workers compensation purposes. Although some of the key provisions of this law are summarized below, you should review the law carefully, in its entirety, and obtain legal advice as appropriate. Under C.R.S (2), every individual who performs services for pay for an entity, even under contract, is to be considered an employee for workers compensation purposes, unless both of the following criteria are met: The individual must be free from control and direction in the performance of the service, both under the contract for the performance of the service and in fact (although any control that is exercised as a result of federal or state law requirements is not considered control for purposes of this criterion); and The individual must be customarily engaged in an independent trade, occupation, profession or business related to the service performance. Two methods exist to establish these criteria: By evidentiary proof; or By the existence of a written contract signed by both the entity and the individual. To prove independence, the following must be shown: The entity must not require the individual to work exclusively for the entity (although the individual may choose to work exclusively for the entity for a finite period of time as specified in the document); The entity must not establish a quality standard for the individual (although the entity may provide plans and specifications regarding the work, as long as the entity does not oversee the actual work or instruct the individual as to how the work will be performed); The entity must not pay a salary or an hourly rate to the individual (instead, it must pay a fixed or contract rate); 8

10 Independent Contractor Guidelines, continued The entity must not terminate the work during the contract period except for a violation of the terms of the contract or the failure to produce a result that meets contract specifications; The entity must not provide more than minimal training for the individual; The entity must not provide tools or benefits to the individual (although materials and equipment may be supplied); The entity must not dictate the time or performance (although a completion schedule and a range of negotiated and mutually agreeable work hours may be established); The entity must not pay the individual personally (rather, it must make checks payable to the trade or business name of the service provider); The entity must not combine its business operations in any way with the business operations of the service provider (rather, all such operations must be maintained separately and distinctly); The contract must contain a disclosure, in type which is larger than that in the rest of the document, or which is boldfaced or underlined, stating that the individual, as an independent contractor, is not entitled to workers compensation benefits and is obligated to pay federal and state income taxes on any monies earned pursuant to the contract relationship; and The contract must be signed by both parties and all signatures must be notarized. 9