• Menu
  • Skip to main content
  • Skip to secondary navigation
  • Skip to primary sidebar
  • Skip to footer

Before Header

  • About
  • Contact
  • Privacy
 
ARCADIA: Stronger Settlement Partnerships. Innovative Solutions.

Amaxx Workers Comp Blog

Reduce Workers Compensation Costs By 20-50%

Header Right

  • Home
    • Training Center
  • Search
    • Free Resources & Solutions
    • Subscribe to Free Newsletter
    • Create Free Training Center Account
    • Enroll in On-Demand Courses
    • Activate WC Mastery Membership
    • Request Strategic Coaching Session
    • Buy WC Guidebooks
  • Membership
    • Insider (free account)
    • WC Mastery
    • Teams & Managers Mastery
    • Training Partners
  • Products
    • On-Demand Courses
    • Specialty Courses
    • Certifications & Mastery Courses
    • Ultimate Guidebooks
    • Coaching
  • Blog
    • Video Blogs
    • COVID-19 / Coronavirus Pandemic
  • Login

Mobile Menu

  • Home
    • Training Center
  • Search
    • Free Resources & Solutions
    • Subscribe to Free Newsletter
    • Create Free Training Center Account
    • Enroll in On-Demand Courses
    • Activate WC Mastery Membership
    • Request Strategic Coaching Session
    • Buy WC Guidebooks
  • Membership
    • Insider (free account)
    • WC Mastery
    • Teams & Managers Mastery
    • Training Partners
  • Products
    • On-Demand Courses
    • Specialty Courses
    • Certifications & Mastery Courses
    • Ultimate Guidebooks
    • Coaching
  • Blog
    • Video Blogs
    • COVID-19 / Coronavirus Pandemic
  • Login
  • About
  • Contact
  • Privacy
You are here: Home / Buyers Guide: Workers Compensation Insurance / Buying Workers' Comp / 8 Steps For A Staffing Agency to Reduce Workers Comp Costs

8 Steps For A Staffing Agency to Reduce Workers Comp Costs

November 13, 2018 By //  by Rebecca Shafer, J.D.

Staffing Agency Reduce Workers Comp Costs Imagine trying to calculate your workers’ compensation premium when you do not know the number of employees you will have at any one time or their job classifications. That’s life for the temporary staffing agencies – in their own peculiar world when it comes to workers’ compensation. Temporary staffing agencies often have a difficult time obtaining and maintaining workers’ compensation insurance.

In most jurisdictions, the temporary staffing agency is responsible for the workers’ compensation insurance as the worker is considered an employee of the temporary staffing agency, not an employee of the client.

While the broker for the temporary staffing agency can meet with an employer to get an estimate of the numbers and types of positions the agency may fill, it is only an estimate, or sometimes a” shot in the dark.”

Click Link to Access Free PDF Download

“How to Calculate Your Minimum Experience Mod, Controllable Premium & the Revenue Impact”

Misclassification of Employees Is Ongoing Problem

The workers’ comp premium classification code system did not have the temporary staffing agency in mind when the system for calculating workers’ comp premiums was created. Misclassification of employee job codes and under-reporting of payroll is an on-going problem for workers’ compensation insurance companies. The workers’ compensation premium audit is definitely necessary at the end of every policy year to get an accurate premium.

Some workers’ compensation insurance companies who do insure temporary staffing agencies take the process a step further. They created what is referred to as “pay as you go program” where the temporary staffing agencies workers’ comp insurance premiums are adjusted monthly or quarterly based on actual payroll data.

Captives or Assigned Risk Pools

National staffing companies in the temporary staffing agency business set-up their own captives to self-insure their workers’ comp claims with the benefit of re-insurance to cap their total loss exposure. Smaller temporary staffing companies have joined “rent-a-captive” insurance programs in their effort to reduce their workers’ comp cost. Temporary staffing agencies with poor claim records (and some with not so bad of claim history) are forced into assigned risk plans or state pools.

In the past workers’ compensation premiums were such a big burden for temporary staffing agencies, some agencies were forced out of business. (For many temporary staffing agencies, the workers’ comp insurance premium is their second-largest expense after payroll.) These were the staffing agencies who did not try to control their workers’ comp losses or who did a poor job screening potential employees.

FREE DOWNLOAD: “How to Calculate Your Minimum Experience Mod, Controllable Premium & the Revenue Impact”

8 Steps For Staffing Agency to Reduce Workers Comp Costs

All temporary staffing agencies regardless of size can take certain steps to reduce overall workers’ comp cost.

  1. Proper vetting and screening of employees you place with your clients. The screening process includes drug testing, background checks, and prior injury history.
  2. Refusing potential clients involved in hazardous or dangerous work.
  3. Testing and verifying the skill sets of employees before they are placed with an employer as improperly or inadequately trained employees are much more prone to injury.
  4. Verifying the employee has the proper safety equipment and protective gear, or the client has the equipment and gear necessary and will provide it to the employee.
  5. Training the staff of each placement office on proper and timely reporting of workers’ comp claims.
  6. Have a workers’ comp claim coordinator who actively follows up on a regular basis with any employee who is off work.
  7. Have a return-to-work program allowing you to place the employees who do get injured back to work at a different client who can accommodate any work restrictions.
  8. Have an insurance broker who is familiar with the temporary staffing agency business and who can place your company with more than one workers’ compensation insurance company.

Temporary staffing agencies can expect to experience periods of fluctuation making it difficult for them to obtain workers’ compensation insurance. The best way to protect your business profits and to be able to purchase future insurance coverage is to actively manage your workers’ comp insurance program now to reduce the number of claims.

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the co-author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.

Workers’ Comp Roundup Blog: https://blog.reduceyourworkerscomp.com/

©2018 Amaxx LLC. All rights reserved under International Copyright Law.

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

FREE DOWNLOAD: “How to Calculate Your Minimum Experience Mod, Controllable Premium & the Revenue Impact”

Filed Under: Buying Workers' Comp

Related Articles

Buyer Beware – 5 Things To Know About Lowest Work Comp Bidder

Buyer Beware – 5 Things To Know About Lowest Work Comp Bidder

Maximize ROI of Workers’ Comp Management Improvements with the Right Insurance Structure

Maximize ROI of Workers’ Comp Management Improvements with the Right Insurance Structure

A Statutory Employer Becomes Actual Employer By Law

A Statutory Employer Becomes Actual Employer By Law

Avoid Problems With Out of State Workers Comp Claims

Avoid Problems With Out of State Workers Comp Claims

State Risk Pool Is Option for All Employers, Not Necessarily Where You Want To Be

State Risk Pool Is Option for All Employers, Not Necessarily Where You Want To Be

If You Can Not Get Workers Comp Coverage, Look to the State Fund

If You Can Not Get Workers Comp Coverage, Look to the State Fund

Oklahoma Insurance Commissioner Notes NCCI Decrease Cost Request

Oklahoma Insurance Commissioner Notes NCCI Decrease Cost Request

Eight Things to Know About Professional Employer Organizations (PEO) to Lower Workers Comp Costs

Eight Things to Know About Professional Employer Organizations (PEO) to Lower Workers Comp Costs

Volunteers and Workers Compensation

Volunteers and Workers Compensation

Florida Man Arrested in Workers Comp Scheme

Florida Man Arrested in Workers Comp Scheme

Georgia Workers Compensation Basics

Georgia Workers Compensation Basics

Ohio Workers Compensation Basics 101

Ohio Workers Compensation Basics 101

Free Download

How to Calculate Your Minimum Experience Mod, Controllable Premium & the Revenue Impact - FREE Download Click Here Now!

Train to Succeed

BECOME CERTIFIED IN WORKERS’ COMPENSATION

Proven Course Catalog & WC Toolbox Give You The Power To Achieve Lower Costs and Better Injured Worker Outcomes

VISIT WORKERS' COMP TRAINING CENTER

Previous Post: « 6 Triggers for When, And When NOT to Use Nurse Case Managers
Next Post: 25 Ways to Avoid Holiday Workers’ Comp Injuries »

Primary Sidebar

FREE DOWNLOAD

How to Calculate Your Minimum Experience Mod, Controllable Premium & the Revenue Impact - FREE Download Click Here Now!

Our Sponsors

ARCADIA - Enhancing Settlement Outcomes

The Structured Settlements Company
 

Catastrophic and Risk Solutions, Case Management Solutions, and Specialty Networks
 

MSAs, Section 111 Audits, & Conditional Payment Resolutions
 

Post-Settlement Administration
 

Medcor

Injury Triage, Onsite Clinics

Read Our Award-Winning Blog

Blog Categories

Search Our Archive

Subscribe to Our FREE Newsletter

Return-to-Work Essentials

Footer

Search Our Archive

Search our continually growing archive of over 2500 articles about Workers' Comp issues.

Quiclinks

  • Calculators
  • Terms & Abbreviations
  • Glossary of WC Premium Terms
  • WC Resources
  • Best Practices
  • Industries
  • Return-to-Work Essentials

RSS Recent Blog Posts

  • 11 Tips for Taking an Effective Recorded Statement in Workers’ Compensation Claims
  • 10 Best Practices for the Workers Compensation Claim Handler
  • Properly Handling Mental Claims in Workers’ Compensation
SUBSCRIBE TO OUR FEE NEWSLETTER
Let Us Help You Stomp Down the High Cost of Workers' Comp!
Top of Page ↑
  • Home
  • Training Center
  • Search
  • Membership
  • Products
  • Blog
  • About
  • Contact
  • Subscribe
  • Login
Copyright © 2023 Amaxx, LLC. All Rights Reserved. · Privacy Policy / Legal Notice