Reducing Workers’ Compensation Costs

All business owners know that maintaining a business can be costly.  Advertising, inventory, rent, and taxes, just to name a few.  In California, almost all businesses are also required to carry workers’ compensation insurance.  Workers’ compensation insurance can be costly.  All businesses, ranging from large corporations to small businesses, are all trying to reduce costs in order to maximize profitability.  Although California law likely requires you to carry workers’ compensation insurance for your business, there are techniques you can employ to help reduce your workers’ compensation costs.

One way to help you reduce your workers’ compensation insurance costs is to make sure you understand how your workers’ compensation insurance premium is determined.  Workers’ compensation insurance premiums are based on a specific classification system.  The more dangerous the roles of your employees, the higher your workers’ compensation rates will be.  Accordingly, you need to have an open line of communication with your insurance adjuster to ensure that he or she is assigning the correct classification to your workers.

Another way to reduce your workers’ compensation insurance costs is to make sure that your workplace is as safe as possible.  Ensure that you keep your equipment up to date and in good repair.  Creating a safety committee in the workplace can also help, as your employees can take a direct role in keeping your workplace as safe as possible.  As your employees are the ones who directly deal with all workplace conditions, they often have some important suggestions as to how to make your workplace even safer.  The fewer injuries you have in your workplace, the lower your workers’ compensation premiums will be.

Third, you should build a return to work program.  An important rule of thumb to keep in mind is that the longer a workers’ compensation claim remains open, the more expensive the claim will be.  This is because the claim will require that more replacement income benefits must be paid.  Accordingly, if you can build a program that proactively helps workers get back to work, income benefits will not have to be paid for as long a time.  A return to work program often includes allowing an employee to return on a light-duty or even part-time basis.  You will need to coordinate these plans directly with the employee’s health care provider to make sure the work is appropriate for the particular injury.

We have extensive experience helping our clients understand their rights and responsibilities with regard to workers’ compensation responsibilities.  Call us today for a consultation.

Reducing Workers’ Compensation Costs

Recent years have seen definite drops in employee work-related injuries. This is a happy development, but, unfortunately, has not lead to corresponding drops in workers’ compensation insurance premiums to employers. Despite this, there are ways to help reduce the cost of your workers’ compensation.

The first way is the most obvious – continuing to reduce injuries. Continuing to keep up with the latest safety measures and technology to reduce work-related injury is an excellent way to ensure continuing drops to injuries. Making sure your machinery, work place, and equipment is in good repair is also vital.

Next, make sure your staff is receiving adequate training. Training manuals and videos are good tools for this, but it is also important to make sure that the employees are actually reading and absorbing this material. The material also needs to be up-to-date. For example, if you have implemented new safety procedures and new safety technology, it is imperative that manuals and training materials are updated accordingly.

Third, it can be beneficial to incentivize your employees. Set goals for meeting particular safety benchmarks, and make the benefits applicable to the entire workplace. This not only will compel each individual employee to try to maintain safety standards, but will also generate an atmosphere of cooperation and positive peer pressure to make sure that the safety procedures are appropriately utilized.

It should also go without saying that you need to be honest with your workers’ compensation insurance company. Make sure the company is aware of the safety procedures you have implemented and maintain an open dialogue to make sure that your premiums are set appropriately.

If a worker is injured on the job, contacting the appropriate medical personnel immediately is vital. This will help ensure that the worker does not sustain further injury.

If you have failed to maintain insurance, a worker gets injured, and the Uninsured Employers Benefits Trust Fund is seeking to place a lien against your business, another way to “after the fact” help reduce the cost is to seek assistance from a lawyer trained in workers’ compensation matters. That attorney may be able to help you negotiate payments or even reduce the final lien amount with the Trust Fund.

Businesses should take all available precautions to help reduce their workers’ compensation costs through training and procedure. If a lien or judgment is established, the business should contact an attorney to help negotiate that amount. I have significant experience and training in workers’ compensation, and can help you. Contact me today at 714-516-8188 to discuss your business and its liabilities.

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