Injury and Illness Prevention Plans Save You Money, Period!

IIPP

Employees are your most valuable asset, but many businesses overlook the importance of having a workplace safety program in place to protect them.

Loss control is about employers caring for their workers’ safety. Successful loss control programs are means of reducing injuries and the severity of a potential accident.

If you want to reduce the costs and risks associated with workplace injuries and illnesses, you need to address safety and health right along with production. You should start by writing a plan and see that it is put into practice. Specifically, that means creating and implementing an Injury and Illness Prevention Program (IIPP).

The IIPP will identify what has to be done to promote the safety and health of your employees, and the safety of your worksite. Elements of your IIPP should include:

  • Assignment of responsibility
  • Communications
  • Compliance
  • Inspections
  • Investigations
  • Correcting unsafe conditions
  • Training
  • Recordkeeping.

Taking this approach to loss control will make the workplace safer, decrease workers’ compensation and overtime costs, reduce turnover rates, and minimize the risk of Occupational Safety and Health Administration fines — all of which in turn will increase productivity and profits.

Loss control starts with an authentic commitment from management. You should also ensure that supervisors, managers and employees are all on board and, together, the collaborative teams will achieve success.

Hazard assessment, evaluation, action-planning, problem-solving, implementation, record-keeping and documentation are the steps for a successful loss control plan.

Open communication is vital

Open communication with employees is important to facilitate a successful loss control program. Employee cooperation is connected to everyone understanding what the program is all about, why it is important to them and how it personally affects them.

Consider different channels via which your workforce can be informed, including meetings, e-mails, newsletters or text messages. Training is an important aspect of your program to ensure everyone has a good understanding of workplace safety.

Records are an important part of your safety plans. Records that should be maintained include:

  • Training
  • Employee injuries
  • Accident/injury investigations
  • Inspection records/corrective actions
  • OSHA 300 logs (where required)
  • Job analysis
  • Safety meetings
  • Equipment and vehicle inspections
  • CPR/first aid training
  • DMV driving records.

The takeaway

Remember to update and maintain all your programs at least once a year and/or if there are any changes.

If you are ready to make the commitment of reducing injuries and illnesses and managing claims, you can expect your costs to go down and your profits to go up.

New Workers’ Compensation Rate Filing Expands COVID-19 Surcharge Tiers

workers' compensation

The California Workers Compensation Insurance Rating Bureau has amended its 2021 rate filing to make its earlier recommended COVID-19 surcharge more equitable.

The Rating Bureau is leaving unchanged its overall recommendation that benchmark rates be increased an average of 2.6% for policies incepting on or after Jan. 1, 2021.

But it modified an earlier recommendation that a COVID-19 surcharge of $.06 per $100 of payroll be applied to all policies in favor of a six-tiered surcharge ranging from one cent per $100 of payroll for the least-risky sectors to a high of 24 cents for the riskiest. All sectors will be placed in one of six tiers depending on their relative share of COVID-19 claims that had been filed through the end of August.

The Insurance Department just wrapped up hearings on the rate filing in early October and will announce whether it approves the rate filing or makes changes.

Had the pandemic not hit, the Rating Bureau would not be asking for a rate increase, but a reduction of 1.5%. The Rating Bureau estimates that estimate that the cost of COVID-19 claims on Jan. 1, 2021 to Aug. 31, 2021 policies is 4.1%, or $0.06 per $100 of payroll to an average of $1.56 per $100 of payroll.

The benchmark rates (or pure premium rates) are published as guideposts for insurers to price their policies and insurers are not required to follow them, although most do to some degree.

While the Bureau earlier said it would not apply COVID-19 claims towards employers’ individual experience modifiers (X-Mods), the surcharge will apply to all employers, even those who have not seen any coronavirus-related illness claims.

Below is a list of the six different surcharge tiers and some of the NAIC industry class codes that would fit into each of them. (Please note that the two digits are the first two numbers of four-digit class codes and all class codes that start with those two digits will see the surcharge applied, unless otherwise noted with a four-digit code).

1 cent

  • Management of Companies and Enterprises (55)
  • Information technology (51)
  • Professional, Scientific, and Technical Services (54)

3 cents

  • Outside Sales (8742)
  • Finance and Insurance (52)
  • Clerical (8810)
  • Mining, Quarrying, and Oil and Gas Extraction (21)
  • Arts, Entertainment, and Recreation (71)
  • Real Estate and Rental and Leasing (53)

6 cents

  • Administrative Support and Waste Management and Remediation Services (56)
  • Wholesale Trade (42)
  • Construction (23)
  • Educational Services (61)
  • Manufacturing (31)
  • Other Services (except Public Administration) (81)

12 cents

  • Public Administration (92)
  • Retail Trade (44)
  • Transportation and Warehousing (48)

18 cents

  • Accommodation and Food Services (72)
  • Agriculture, Forestry, Fishing and Hunting (11)

24 cents

  • Healthcare and Social Assistance (excluding Physicians, Dentists, and Daycare) (62)

The surcharge in many cases amounts to a roughly 30% increase over the indicated rate without a specific surcharge.

Mandatory Employer Sign-ups for CalSavers Have Begun

CalSavers

If your company does not offer its staff a 401(k) plan, you need to be aware of deadlines for registering your employees in the CalSavers Retirement Savings Program.

The program is designed to help California workers who do not have access to an employer-sponsored retirement plan start socking away money for their retirement. Employers with five or more workers are required to give their employees access to the CalSavers program, which was launched in 2019.

Deadlines for when employers have to adopt the program depend on their size:

  • Businesses with more than 100 employees: Sept. 30, 2020
  • Businesses with more than 50 employees: June 30, 2021
  • Businesses with five or more employees: June 30, 2022

Employers that miss adoption deadlines or fail to allow employees to participate in the program, can face penalties of $250 per employee if they don’t comply within 90 days of receiving notice from the state. The penalty increases to $500 per employee if the employer fails to comply within 180 days of receiving notice.

If your business has more than 100 employees and missed the Sept. 30 deadline, you still have time to avoid penalties by signing up now.

How it works

The program enables eligible employees to automatically contribute a portion of their paycheck to a Roth individual retirement account (IRA).

Under the law, any California employer with five or more workers must give them access to CalSavers, unless they offer a 401(k) or similar employer-sponsored retirement plan. While it’s mandatory for employers to offer CalSavers to their employees, workers are not obligated to sign up.

Under the program, employers are not required to make contributions on behalf of their employees and will incur no fees. They will be required to submit employee contributions through automatic payroll deductions.

Here’s what your employees need to know about CalSavers:

  • Accounts are portable and can be moved to another job.
  • The funds are owned by the saver, regardless of whether they leave their job.
  • Their IRA offers investment options, so the saver can choose where to park their money.
  • Employees can choose how much they want to set aside of each paycheck, up to 8%.
  • Employees can set aside a maximum of $6,000 a year into the account, or $7,000 if they are age 50 and over.
  • Fees are less than $1 per $100 deposited (they range from 0.825% to 0.95%).
  • Employees can opt out at any time.

Setting up your business’s account

Employers that want to sign up their staff can apply here (www.employer.calsavers.com).

When setting up the account you’ll need to:

  • Create a payroll list to enroll employees.
  • Assign a person in your human resources to manage the account and transfers.
  • If you use a payroll service, you will need to give them access to your account to handle the transfers.

Once you’ve created your company account, you can set up auto-enrollment for all of your new employees. Once you add a new employee to your account, they will receive an e-mail containing plan details and default elections.

Thirty days later, the deductions will be automatically withdrawn from their next paycheck and deposited in their Roth IRA.