It’s no secret that most employers look at the idea of worker’s compensation as a necessary evil to employing people legally, and the cost of having their own business. Once it’s completed, employees feel that it’s no longer necessary to take another look at it again; however, low rates come and go, and most employers aren’t aware of these changes. Here are four mistakes the employers make when it comes to worker’s compensation for their employees.
- Employers assume that lower costs and lower rates go hand in hand
The aforementioned couldn’t be further from the truth, and you shouldn’t make the bold assumption that just because you got in a good, low rate, that you’re automatically going to have lower costs. When a representative for worker’s compensation looks at the claim, they use a type of modification factor for examining the losses, and other costs. These losses are compared to companies that are incredibly similar to yours, but if the losses are below the average amount, you’ll get a lower credit rating, which ultimately lowers the premium; however, a surcharge will be added when the losses are above the average comparison.
- Employers assume they have limited control over worker’s compensation expenses
While most employers know that they’ll have to have worker’s compensation insurance of some kind for those that they employ, they believe that they don’t have any control over their circumstances. You don’t have to pay excessively for your worker’s compensation and just take it as if that’s the only option. When you start the hiring process for your new employee, this is where your cost reduction begins. Background checks, along with interview techniques that are incredibly effective will ensure that you’re going to hire someone healthy and competent enough to not cost you an incredible amount come worker’s compensation time.
Putting into place an effective return-to-work program is also incredibly important, so you don’t take a total loss on your projects or your employee.
- Employers often neglect injury management during periods of lower rates
Because of how absent-minded employers can be after they have their worker’s compensation in place for their employees, they tend to forget that they can make use of programs like injury management and cost containment during periods that have lower rates. Safety should be at it’s highest at all times, and an employer should strive to dedicate time to work on this area of the company regularly. Make sure to always keep an eye on the cost of lost wages, medical claims, and monitor these frequently. It doesn’t matter if the rate is lower or not!
- Employers don’t connect the dots between worker retention and cost containment
It’s incredibly important for employers to make a connection and association between worker retention and cost containment. While fewer accidents happen in environments of those with extremely skilled workers, skilled workers aren’t completely immune from accidents. Ensuring a great return to work program will ensure that you can keep some your skilled workers by your side.
Let us help you navigate these sometimes confusing worker compensation insurance waters and make sure that you get insurance with the right company that best suits the needs of your business.CONTACT US