Workers’ Compensation Insurance

A blanket waiver of subrogation will be available to apply if already applicable on your policy. You must contact ADPIA’s licensed service agent, if your request for a certificate of insurance requires a specific waiver of subrogation. POP is an employee benefit that helps businesses and employees reduce their tax expenses by providing a way for employees to pay part of their health insurance premiums with pre-tax dollars. My partner and I subcontract work to other contractors, but have no employees. Do we need workers’ compensation insurance for ourselves? The answer to this question is complicated and depends on several factors. Contact us and a licensed APDIA agent will be able to help you.

I used payroll cost and headcount reports for the PPP loan application. Can I use the same reports for purposes of loan forgiveness reporting? No, the ADP payroll cost and headcount reports that were developed to support PPP loan applications cannot be used for PPP loan forgiveness purposes. ADP has reports available to support clients that are navigating the forgiveness process. See below for more information about PPP loan forgiveness reports that are available. Ohio-based businesses must obtained workers’ compensation coverage through the Ohio Bureau of Workers’ Compensation — but we do offer ADP’s Pay-by-Pay service to Ohio clients.

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Click here for a brief explanation of how payroll costs are calculated in this report. As your payroll and HR partner, ADP can help you gather information to understand the payroll specific components of your PPP loan. These reports are easily accessed within your ADP system and are updated regularly as government guidance changes. You will need to complete the PPP loan application, which your lender will provide, and submit the application with your payroll documentation. If you are applying for a second PPP loan, remember to run new PPP loan application reports from your ADP system. The ADP reports are updated frequently to reflect the latest government guidance.

Workers’ compensation insurance generally pays for the rehabilitation, recovery or medical bills of employees’ work-related injuries, as well as lost time due to a work-related injury. Workers’ compensation insurance is not a substitute for health or medical insurance — employees are only covered for on-the-job injuries. Whether you need competitive proposals from multiple carriers, advice from a licensed agent, detailed reports or more, you can receive the full value of integrating payroll with select insurance policies when you partner with ADPIA. Being incorrectly classified can cause you to get dropped by your insurance carrier. Getting dropped is going to put you in a frantic rush to find new coverage, putting your business to a halt in the meantime.

You’ll have access to information at the employee, state, and class-code level, allowing you to manage your workers’ compensation expenses better. Workers Compensation Codes consist of a 3-to-4 digit system assigned by either a state rating bureau or the NCCI. Class Codes are used to differentiate various job duties done by employees in an industry. Most of the classification systems contain unique codes which provide premium guidelines for the workers’ compensation insurance. If the pay reduction was made outside the February 15 to April 26 timeframe, the forgivable amount may still be reduced even if the pay reduction is later reversed. When calculating the amount of loan forgiveness, how will the determination of whether my business has maintained pay levels be made?

You should always run the applicable PPP report as close in time to submitting your PPP loan application as possible. For your reference, click here for application form provided by the SBA. 1 Only available to ADP Payroll clients using RUN powered by ADP® with ADP’s Pay-by-Pay® premium payment program for Workers’ Compensation. Excludes specific waivers of subrogation and other special requirements that may be needed in a certificate of insurance.

The latest guidance from the government indicates that borrows are eligible for forgiveness for payroll costs paid and payroll costs incurred, but not yet paid, during the Covered Period or Alternative Payroll Covered Period. Payroll costs are considered paid on the date of distribution of paychecks or origination of an ACH credit transaction. Payroll costs are considered incurred on the day that the employee’s pay is earned. Payroll costs incurred but not paid within the Covered Period or Alternative Payroll Covered Period must be paid by the next regular payroll date to be counted for forgiveness purposes. Detailed reporting allows you to track and manage premiums paid every time you process payroll.

At least 60 percent of the loan amount was used for eligible payroll costs, and no more than 40 percent was used for the other Loan Uses described above. Additionally, borrowers who previously received loans of $50,000 or less may be exempt from reductions in loan forgiveness amounts based on reductions of full-time equivalent employees or in salaries or wages. If eligible, borrowers would use the SBA Form 3508S, or their lender’s equivalent form, to submit their loan forgiveness application. ADP has put together a Loan Forgiveness Checkup which outlines important steps to take before year-end to maximize loan forgiveness.

A proper classification helps estimate expenses or losses related to the risk they are insuring. This system of workers compensation class codes highlights the importance of classifying a business correctly.

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How will the determination of whether my business has maintained staffing levels be made? To determine whether staffing levels have been maintained, the average number of full-time equivalent employees during the applicable Covered Period or Alternative Payroll Covered Period will be compared to one of two time periods. Borrowers may either use the period from February 15 through June 30, 2019 or January 1 through February 29, 2020. If the number of FTEEs during the Covered Period or Alternative Payroll Covered Period is lower than the time period chosen, the amount of loan forgiveness may be reduced proportionately. Learn how integrating payroll and workers’ compensation premium payments freed up employees to spend more time on client care. How can I determine the premiums I’ve paid on my policy? As an ADP Pay-by-Pay client, you will receive the Pay-by-Pay Premium Report that helps you track your policy premiums.

Instead, borrowers will need only to demonstrate that they spent the loan proceeds on covered payroll (at least 60% of the forgiveness amount) and non-payroll costs. Borrowers can download the PPP Loan Forgiveness Payroll Costs report from their ADP system to submit to their lender with the 3508S form.

This benefit enables the insured to have their premiums calculated on actual payroll runs. ADPIA then remits those premium payments to the Ohio BWC. ADP has reports to help clients determine their Paycheck Protection Program covered payroll costs.

If less than 60 percent of loan is used on payroll costs, the amount of loan forgiveness may be reduced proportionately and may need to be repaid. What happens if I use less than 60 percent of the PPP loan on payroll costs? The Paycheck Protection Program Flexibility Act provides that at least 60% of the covered loan amount must be used for payroll costs. If less than 60% of the loan amount is used on payroll costs, the amount of the loan that is forgiven may be reduced. The Treasury Department has indicated that at least 60% of the loan forgiveness amount must have been used for payroll costs. Do all payroll costs need to be paid within the Covered Period or Alternative Payroll Covered Period?

When you then try to get insurance from another carrier, the first question they will ask is “Have you recently been dropped or denied coverage? ” If this is true, it will raise a big red flag for the new insurance company. They will most likely either refuse to quote or markup the rate due to the increased risk.

Proper classification is necessary to provide correct workers compensation insurance at a fair and sustainable rate. NCCI is and independent advisory organization that is largely funded by insurance companies. Most insurance companies use the NCCI for various services, including statistical data for workers compensation rates.

My company previously laid off an employee, but later offered to rehire the employee. If the employee declined the rehire offer, will my PPP loan forgiveness amount still be reduced?

NCCI functions to obtain and provide accurate statistical loss data that is used to set manual rates for workers compensation insurance. NCCI is the most widely used classification system in the United States. At least 60 percent of the forgiveness amount was used for payroll costs, and no more than 40 percent was used for the other permitted Loan Uses.

Why Do Some States Have Different Class Codes For The Same Type Of Work?

In addition, the COVID-19 relief law passed by Congress in December 2020 provides that the forgiven portion of a PPP loan can be excluded from gross income. Borrowers have 10 months from the end of their covered period to apply for forgiveness before they would need to start paying back any portion of their loan. Lenders have 60 days to make a decision on loan forgiveness.

This report is available every time you process payroll and provides a breakdown of premiums paid by employee, class code, and check date, and also gives you a year to date total. Each time a client runs payroll with ADP, the premiums for their workers’ compensation policy are calculated and forwarded directly to the insurance carrier. To make sure your employees are correctly classified, you can generally trust your insurance agent and insurance company to assign you to the correct code. If you disagree with the code you have been assigned you can appeal the classification by following the link to contact the department of insurance for your state. In doing so can have an auditor come to your site, inspect the business operations, and provide a ruling. For an insurance company, this established a starting point when underwriting a business.

Spend the loan proceeds, or incur qualifying costs, within applicable Covered Period or Alternative Payroll Covered Period. To obtain full forgiveness, loan proceeds must be spent within to the 8- to 24 week period immediately following disbursement of the loan . The new round of PPP funding includes other important changes to the PPP loan forgiveness process, some of which may apply to loans issued previously in 2020.

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ADP is actively evaluating these changes and will update the guidance below and in the PPP Loan Forgiveness Reports as additional guidance is issued by the Treasury Department and Small Business Administration. For example, the CAA 2021 provides that the SBA will issue a streamlined forgiveness application form for loans of $150,000 or less. This one-page form would require borrowers to certify certain information related to loan forgiveness, list the amount of the loan, number of employees retained and estimated amount of the loan spent on payroll costs. Borrowers would be required to retain – but not submit – documents substantiated their forgiveness application for 4 years for employment records and 3 years for other records. Yes, the amount of the loan can be fully forgiven as long as certain conditions are met. The specific amount will generally depend in part on what portion of the loan is used on eligible payroll costs and whether the employer has maintained staffing and pay levels during the covered period. The 3508S form eliminates the need for borrowers to demonstrate that they maintained wage and employment levels during the applicable covered period.

• + To obtain full forgiveness, loan proceeds must be spent during the Covered Period or Alternative Payroll Covered Period.
• What is the period within which I must spend my loan proceeds to obtain full loan forgiveness?
• To obtain full forgiveness, loan proceeds must be spent within the 8- to 24-week period immediately following disbursement of the loan.
• To obtain full forgiveness, loan proceeds must be spent within 8 to 24 weeks immediately following disbursement of the loan, whichever is earlier.

What is the period within which I must spend my loan proceeds to obtain full loan forgiveness? To obtain full forgiveness, loan proceeds must be spent within the 8- to 24-week period immediately following disbursement of the loan. + To obtain full forgiveness, loan proceeds must be spent during the Covered Period or Alternative Payroll Covered Period. To obtain full forgiveness, loan proceeds must be spent within 8 to 24 weeks immediately following disbursement of the loan, whichever is earlier.

Help Improve Cash Flow With Payroll And Workers Comp Integration

As a business, the best way to save money on your workers’ compensation insurance is to build a long, trusting relationship with your carrier. The basic code generally denotes a particular industry such as wholesalers, retailers, manufacturers, restaurants, and truckers. Employees are generally grouped into the classification codes that are based on similar job functions. There are certain criteria that are arranged for business operations or to have a basic gathering statistical experience. This information is gathered to help construct the workers’ compensation insurance rates for that industry. The rules and regulations for work compensation are unique for every state.