Addressing Stolen Time Through an Aggressive Return-to-Work Program
RCS Influencer Brian Pratt takes a different approach to reducing stolen time when workers’ compensation is involved.
To help manage the employees’ wages/cost for our roofing clients we have recommended implementing an aggressive return-to-work program for an injured employee and manage the workers’ compensation piece with the following premium reduction strategy.
Certain workers’ compensation underwriters have individual underwriting guidelines with return-to-work or transitional-duty programs. We have been successful in having our partner carriers add the light-duty worker to a separate class code (typically permanent yard). This class code is confined to the injured worker only conducting non-construction related tasks at the roofing contractor’s office/shop/warehouse. The class code could only be used for workers not exposed to construction-related risks such as height, heat, falling objects, etc. which is typical for a light-duty description. We frequently utilize this strategy to pay a workers’ compensation premium that is reflective of what the injured and light-duty worker is actually performing.
For those roofing professionals that utilize this strategy and can confine the injured worker to a certain class code the cash flow impact and savings, on average, is a 65% reduction to the roofing contractor’s bottom line.
Some key considerations are:
- The class code will be determined based on your operations, state in which you work, job description, etc.
- Workers’ compensation rates vary from state to state. Check to see if your insurance carrier offers another class code that is more in-line with what the injured worker’s job description will be. The rates will vary based on the state that the employee is working in.
- Incorrect classifications can impact your year-end audit. When the auditor reviews your employee roster, employee job description and actual payrolls based on the estimates given at the beginning of the policy period, they’ll review and confirm that the class codes listed on the policy are accurate. If you don’t have the correct classifications listed, the auditor will re-allocate the payrolls which can result in additional premium.
- Check with your insurance carrier before adding a new class code. Generally speaking, insurance carriers have lists of class codes they consider eligible or ineligible based on the exposure the job description presents. It’s important to be transparent with the carrier and that they are comfortable with that classification before the placement is made. This helps avoid a claim being potentially denied or a carrier non-renewing the insurance.
We recommend consulting with your insurance agent and advisor to see if this strategy works within your region and is acceptable with your carrier.
Brian Pratt is a regional manager for Roofing Risk Advisors, Division of Furman Insurance. See his full bio here.
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