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

Before Header

  • About
  • Contact
  • Privacy
 
Paradigm

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 / Insurance Issues, Rates, Premiums / 2 Workers’ Comp Payroll Deductions Employers Often Miss

2 Workers’ Comp Payroll Deductions Employers Often Miss

May 13, 2021 By //  by Michael B. Stack


Click Link to Access Free PDF Download

“Workers’ Comp Claims Review Checklist: 9 Must-Have, Serious-Impact Elements”

Your employer is paying any type of insurance premium. The amount of payroll that employer has is a massively important input, ultimately into the amount of premium that employer pays. Hello, my name is Michael Stack. I’m the CEO of Amaxx. And today I want to talk about just making sure that you’re not overpaying. Nobody likes to overpay for work comp insurance or frankly, for anything for that matter. And I want to talk about a key deduction when you’re going to analyze and audits and refine the payroll that is being used to calculate the amount of premium a company is paying. And I want to talk about this idea of overtime and double time. This is a very common payroll deduction that is missed by employers. It’s just missed by employers. Now, conceptually, I want you to think about this first and just kind of understand before we talk about what this deduction is, understand philosophically, what it means.

Accurately Assess the Risk

So all we’re trying to do in a work comp premium or all the insurance carrier is trying to do in a work comp premium. The amount that an employer is paying is just accurately assess the risk accurately assess the risk. The way that the payroll calculation goes in is the amount of time your employees are working. So if you have more employees working more often, the odds of them getting hurt are higher. So that kind of just makes sense. If you have more employees working more often, the odds of getting hurt are higher. So yeah, that makes sense. And then the premium would be higher because of that, because the risk is higher because you just have more opportunity for people to get hurt.

Overtime and Double-time

Okay. So conceptually, you can get there. I want you to think about this deduction and the meaning behind why overtime and double time would be removed from that equation.

So let’s say you’ve got Nick, you know, Nick is working, let’s say in construction or he’s working on the docks or whatever Nick is doing. And Nick has been racking up the overtime. You know, the, employees have been out, et cetera. Their bunch new work has come in and Nick is just cranking through this overtime. So he’s getting, you know, two times his normal salary philosophically, if you think does, because the fact that he’s getting two times as normal salary mean he’s more two times more likely to get hurt. And of course the answer is no, you know, he’s just working more hours. You should be multiplying him times, one times what his normal salary would, would be. The point of this very simple demonstration is that this overtime and double time should be removed from your payroll calculation over time in double time should be removed from your payroll calculation.

FREE DOWNLOAD: “Workers’ Comp Claims Review Checklist: 9 Must-Have, Serious-Impact Elements”

Huge Financial Impact

So let’s say, you know, this is a $10,000 in additional fees or what he would be making double time. And normally it’s $5,000. So you should be taking 5,000 out of that payroll calculation, looking at one worker over a short period of time. You’re saying now 5,000 may or may not make that big of a difference in my ultimate premium, take this over hundreds and thousands of employees over the course of an entire year. And this number can be massive impact in premium can also be a huge, huge financial impact. Very simple thing, very easy to miss, and very easy to just add a bunch of money to what you’re paying in premium unnecessarily. Again, my name is Michael Stack. I’m the CEO of Amaxx. Remember your work today in workers’ compensation can have a dramatic impact on your company bottom line, but it will have a dramatic impact on someone’s life. So be great.

Author Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%. He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is the founder & lead trainer of Amaxx Workers’ Comp Training Center, which offers the Certified Master of Workers’ Compensation national designation.

Contact: mstack@reduceyourworkerscomp.com.

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

©2021 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: “Workers’ Comp Claims Review Checklist: 9 Must-Have, Serious-Impact Elements”

Filed Under: Insurance Issues, Rates, Premiums

Related Articles

employee class code

Know Your Correct Job Classification Codes To Save Workers’ Comp Costs

Know Your Correct Job Classification Codes To Save Workers’ Comp Costs

Workers Compensation Insurance Premium Audits

Workers Compensation Insurance Premium Audits

When To Start Preparing For your Workers’ Comp Premium Audit

When To Start Preparing For your Workers’ Comp Premium Audit

Experience Modification Method To Calculate Workers Comp Premium

Experience Modification Method To Calculate Workers Comp Premium

Correctly Calculate the Average Weekly Wage

Correctly Calculate the Average Weekly Wage

Independent Contractors in Workers’ Compensation: When Are They Really An Employee?

Independent Contractors in Workers’ Compensation: When Are They Really An Employee?

Understanding the HIGH Cost of Selecting the LOW Price Work Comp Proposal

Understanding the HIGH Cost of Selecting the LOW Price Work Comp Proposal
Six Tips to Get the Most From Your Insurer

Six Tips to Get the Most From Your Insurer

Six Tips to Get the Most From Your Insurer

The 8 Sections of Your Workers Compensation Insurance Policy

The 8 Sections of Your Workers Compensation Insurance Policy
6 Common Mistakes Made In A Workers’ Comp Premium Audit

6 Common Mistakes Made In A Workers’ Comp Premium Audit

6 Common Mistakes Made In A Workers’ Comp Premium Audit

Waivers of Statutory Immunity Impact on Workers Compensation

Waivers of Statutory Immunity Impact on Workers Compensation

Dollars and Cents of Frequency And Severity Work Comp Premium Impact

Dollars and Cents of Frequency And Severity Work Comp Premium Impact

Free Download

Workers' Comp Claims Review Checklist: 9 Must-Have, Serious-Impact Elements - 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: « 3 Skills to Help Determine Workers’ Comp Injury Causation
Next Post: Medicare Secondary Payer Update: Time to Update your Compliance Program »

Primary Sidebar

FREE DOWNLOAD

Workers' Comp Claims Review Checklist: 9 Must-Have, Serious-Impact Elements - 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

  • WC Cost Containment For The Claims Management Team
  • Dealing with Long COVID in Work Comp
  • Common Mistakes: Medical Care and Accepting Every Claim – Article 3 of 3
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