Here’s a bit of good news from the California Labor and Workforce Development Agency.
Rates are going to drop for self-insured employers and workers’ compensation policies for the workers’ compensation administration revolving fund by 28% According to the press release:
The California Labor and Workforce Development (LWDA) today announced reduced assessment rates for self insured employers and workers’ compensation policies by approximately $113.3 million (28 percent) for the Workers’ Compensation Administration Revolving Fund (WCARF) and other funds for fiscal year 2011-12. The lower assessments paid by employers reflect cost reductions achieved through fiscal controls put in place by Governor Brown.
“The reduction in assessment rates is attributed to the following factors:
- Credit and collection reconciliations—This accounts for 29.03 percent of the total reduction
- Adjustments attributed to the difference from last year’s assessment and the current year projection—This accounts for 25.07 percent of the total reduction
- Reduced costs attributed to fiscal controls to DIR overhead costs, hiring freeze and employee furloughs. This accounts for approximately 21.18 percent of the total reduction
- Other cost reductions that include increases in revenues from penalties, savings from accelerated loan repayments, decrease in Uninsured Employers Benefits Trust Fund (UEBTF) claim payments, and a reduction in the fraud account due to an excess balance. This accounts for 24.27 percent of the total reduction.
Insurance companies and self-insured employers will receive assessment notices in the mail. The assessments are authorized by Labor Code sections 62.5 and 62.6.
The assessment covers the following funds:
- Workers’ Compensation Administration Revolving Fund
- Uninsured Employers Benefits Trust Fund
- Subsequent Injuries Benefits Trust Fund
- Workers’ Compensation Fraud Account
- Occupational Safety and Health Fund
- Labor Enforcement and Compliance Fund.
Insurers must pay the assessment for policy holders and recover those funds from policy holders through workers’ compensation policy surcharges and assessments.”
Ok that’s a little wonky. If you want to know how it affects you and your business give us a call or click here: