Page 10 - Ohio RA 2011 Winter FlipBook

8 www.ohiorestaurant.org Winter 2012 Issue

Risk Management. No one else but the ORA can offer customized safety plans, education and services geared specifcally for the food service industry.

Savings. The majority of CareWorks Consultants’ clients actually save the maximum on their current premium. How many other groups can say that?

Retention. Annually, more than 92% of the ORA’s existing members choose to re-enroll in the ORA Workers’ Compensation Group Rating Plan.

It Pays to Compare . All companies should annually review their group rating status. Through the ORA, you are entitled to receive a NO COST, NO OBLIGATION, review of your potential workers’ compensation premium savings. Even if your company is currently enrolled in a group rating plan or did not qualify for group rating last year, we encourage you to take a look at the ORA Group Rating Plan. Each year the BWC assigns new rates based on an employer’s payroll and experience. A company that did not previously qualify due to a penalty rating may qualify this year.

How Do I Enroll? Find out for yourself why organizations choose and remain with CareWorks Consultants. If you have not yet received application information and would like to apply for group rating, please call CareWorks Consultants directly at 800-837-3200. You also may visit CareWorks Consultants’ website to apply for group rating online at www.careworksconsultants.com/groupratingapplication.

What Do Your Peers Have to Say?

“One way for our company to most effectively manage our Workers’ Compensation program is by partnering with the Ohio Restaurant Association and CareWorks Consultants Inc,” said Diane Rimkus, the CFO of Cameron Mitchell Restaurants, Inc., which has participating restaurants in Columbus, Cleveland and Cincinnati. “The ORA and CareWorks Consultants go above and beyond to keep our restaurant saving the most possible on our premiums by participating in the group rating. I can’t imagine what our costs would be without having them on our side to look out for our best interests.”

Understanding the Ohio BWC’s Rating System

You need to understand this critical information to determine your rates

The rate an employer pays to insure an employee in case of a work-related injury is based on the industry pursuit of the employer.

The Ohio Bureau of Workers’ Compensation (BWC) reviews the information on the coverage application and assigns manual classifcations to the employer that correspond with the work being done and the risk of injury due to hazards associated with that work.

For example, the manual classifcation for an offce worker carries a lower rate than the manual classifcation for a construction worker. This is because there is less hazard and risk of injury for the offce worker and claims costs for offce workers are typically lower than claims costs for construction workers.

Over a four-year period that began in 1996, BWC converted its manual classifcations to those established by the National Council on Compensation Insurance (NCCI). The change, mandated by law, allowed BWC to convert to the NCCI classifcation system as it represents a more equitable premium rate structure than the previous system. It also is a more accurate and understandable system, which better classifes employers by their predominant business.

How will I calculate my payment?

Private employers are required to pay workers’ compensation premiums into the State Insurance Fund. Employers calculate their own premium on a payroll report which BWC sends out twice yearly.

The employer is instructed to report the payroll for the previous six-month period separating the payroll according to the different manual classifcations. (Manual classifcations are assigned to each employer based on the job duties reported on the initial coverage application.) The payroll report comes to the employer with the manual classifcations and the rates already entered. The employer enters the actual payroll for each manual classifcation, multiplies by the rate assigned to that manual classifcation, then adds the totals for each and this fgure is the premium amount due to BWC.

Do you want to learn more about premium rates?

The Ohio Constitution requires BWC to classify industries according to the degree of hazard in the business.

This is accomplished when BWC assigns manual classifcations to the employer based on the description of work being performed (this information is taken from the coverage application). Each manual classifcation has its own base premium rate.

How are base premium rates determined?

• Base rates are determined by claims costs for a particular classifcation industry-wide and not just from one employer’s experience. • BWC’s actuarial department analyzes the costs of all claims in each manual classifcation during the oldest four of the most recent fve years. • This information is used to project the cost of claims that will occur the next year for each manual classifcation. • BWC’s administrator uses this actuarial data to make recommendations for premium rates and assessments. • Final approval of premium rates comes from the BWC Oversight Commission. • New rates for private, state-fund employers are effective each July 1 and new rates for public, state-fund employers are effective each January 1.

What is reportable payroll?

To maintain workers compensation coverage, state-fund employers are required to submit a payroll report along with their premium payment to BWC twice yearly. In defning payroll, BWC generally follows the guidelines of the Ohio Bureau of Employment Services and Federal Unemployment Tax Authority (FUTA).

The following items are considered payroll and should be included on the payroll report: • Gross hourly wages and gross salaries • Sick pay (including third party, excluding workers’ compensation) • Bonus payments including stock given as a bonus • All sales commissions • All tips • Severance pay • Overtime pay • All stock gifts • Proft sharing going directly to employees as payroll • Any voluntary employee contributions to

retirement plans, including 401K • Any portion of cafeteria plans as reportable to FUTA, such as cash options and unqualifed benefts • Reasonable value of board, lodging, house or room rent unless provided for the convenience of the employer • Per diem and travel allowance (if not paid as reimbursement expense) • Contributions to deferred compensation by employees, except for government employees • Expenses exceeding one-third of an employee’s normal pay • Personal use of a company car