The close of business on Tuesday, September 3, 2013 is the deadline to report payroll for the first half of 2013. The usual deadline is August 30, but it’s the Saturday of Labor Day weekend so the next business day is Tuesday.
Log in at www.ohiobwc.com and click on Report and Pay on the home page. Enter your policy number. (Read or print the latest edition of Payroll News.) Choose 1/1/13-6/30/13 from the drop down list. Enter the 6 months of payroll for each manual classification. Elected officers in a corporation must report compensation of at least a minimum of $10,894 and up to a maximum of $32,656. If you are a sole proprietor or partner in a partnership and have elected coverage for yourself, be sure to report compensation between $10,894 and $32,656 for yourself in the manual classification that includes SN.
The next page is new and shows which payment options will give you a discount. Make your choice and click Next. The next page is a summary of your payroll and payment choices; click Previous if you want to make changes. Click Make Payment and read the payment choices. Enter your initials to show you have read the choices, and click Next. Click OK once you have entered your payment information. The next screen will provide an opportunity to charge additional premium to another bank account or credit card, in case you want to spread the payments over more than one credit card or bank account.
Read the Electronic Signature page, and enter your initials. Click I Agree.
PRINT the Payment Confirmation page as your receipt, using the Print button at the top of the page. Trust me; you want to have a copy showing when you paid.
PRINT your coverage certificate. Post it with all your other employment posters.
Now your business is protected and your employees are covered for 8 more months.
It’s been more than a month since the BWC audit, and my client just got a call saying their biggest manual classification will be changed from one with a base rate of 0.0995 to one with a base rate of 0.0314. The company will get a refund of about $15,000.
I recently blogged about attending the audit and I praised the auditor for spending more than 30 minutes searching for a lower rated manual classification. But he wouldn’t have looked if I hadn’t insisted he take a tour of the shop, where he saw that the risk of injury was much less than the base rate indicated.
I’ve said it before and I’ll say it again: your accountant knows your numbers, but your TPA knows (or should know) your programs and your operation. TPAs should be at payroll audits, or at least invited.
I like to attend BWC audits with my clients. I can bring clarification for the auditor and minimize changes that are detrimental to my clients. Often I learn something. Here’s what I learned from the latest audit I attended.
The BWC is concerned about the financial health of its customers, so it schedules an audit to cover one year. If the audit results in a refund for the company, the BWC may audit a second year hoping to return more money to its customer. If the audit results in additional premiums due from the company, the BWC will not look at a second year.
I encouraged our auditor to take a tour of the workplace. Once he saw what work was performed, he spent more than 30 minutes looking for a less expensive manual classification, because the risk of injury at my client’s facility was obviously less than the risk at other companies in the same classification. He didn’t find a better classification, but he really tried.
Only partners in a partnership are bound by the minimum & maximum reporting requirements (assuming they have elected coverage). The President and Vice President in a partnership are titles, not elected officers as in a corporation, and so their compensation is reportable as employees.
There has been a BWC committee since 2006 to eliminate the minimum and maximum reporting requirements. The minimums discourage sole proprietors and partners from electing coverage for themselves. Nonprofits, like the Elks and the Eagles, have to report minimums & pay premiums to cover their officers, who are often unpaid volunteers.
What is the auditor looking for?
Are the payroll numbers reported to ODJFS (unemployment comp) and the IRS the same as the payroll numbers reported to the BWC?
Are the manuals assigned to the employer correct? Does the employer need additional classifications? Is each employee’s payroll reported under the correct classification?
Has the construction workers cap been applied correctly?
Are there additional payments or benefits provided to employees that should be included in the payroll reported to the BWC?
Are 1099 recipients independent contractors, or are they really employees?
Verification of the type of entity, such as corporation, LLC, partnership, etc. Are the payrolls for the officers/partners/sole proprietors reported correctly?
Has all casual labor payroll been reported?
What a BWC audit ISN’T
An inspection to find safety violations and notify OSHA or the Department of Labor.
An excuse to waste a lot of employer’s time.
A witch hunt.
Ohio workers’ compensation premiums are due by the close of business on Thursday, February 28, 2013.
If you report your payroll and pay your premiums online at www.ohiobwc.com, the BWC will automatically calculate and deduct a 1% Go Green discount. You will not get the discount if you pay your premiums through the Ohio Business Gateway. You also will not get the discount if you have to pay the minimum premium of $50.
If you have elected coverage for yourself as a sole proprietor, partner in a partnership, or corporate officer incorporated as corporation, you must report a minimum of $405 per week ($10,530 for 6 months) as your payroll. The maximum you may report is $1,214 per week ($31,564 for 6 months). You must report the actual amount if it falls between the minimum and maximum.
Officers of a corporation must also report at least the minimum. Officers of Subchapter S corporations must report a reasonable amount of wages for the services they perform.
The payroll of all other employees must be reported as earned, without regard to any minimums or maximums. If you are not sure which workers are employees and which are independent contractors, consult the BWC, your accountant, your employment law attorney, or your TPA.
On 11/15/12, the BWC introduced a new My Policy page for employers. It is a dashboard of the information an employer needs most often. Your TPA or other representative will not have access to this page, but can find the same information scattered throughout the BWC website.
Once you log in as the employer, you will automatically go to the My Policy page.
Company information includes your policy number and contact info. There is a button to update the address, telephone number, etc.
Account balance shows the total amount due plus buttons to make payment, report & pay and FlexPay.
Rating plan information includes your current EM (experience modifier), rating plan and total costs paid for the experience period.
Coverage status includes buttons to reprint your coverage certificate and request to cancel your coverage.
Program plan information shows your current plan, such as group rating, plus an eligibility lookup button.
Claim history lists claims with links to see more claims and more information about each claim.
Communications profile shows the email addresses for paperless payroll reports and BWC updates.
Important dates lists deadlines that are important for your current status.
If you have been getting bills for next year from your current group TPA, do not pay them now. Here’s why:
1. The deadline to enroll in group rating is the end of February 2013. Why pay now for services that won’t start until next July?
2. If you haven’t seen the projected discount, how do you know if you want to stay with your current group and/or TPA?
3. If you haven’t seen other group offers, how do you know this year’s group will be best for you next year?
4. If you pay now, will you remember to request your money back if you change TPAs?
5. Are you willing to let your current group TPA keep a portion of the payment if you change to another TPA? (You did read the contract, didn’t you?)
Some invoices are honest enough to state that payment does not guarantee that your company will be accepted into group rating. So why rush to pay?
The ONLY EXCEPTION is if the bills are for the current year of group rating. If you don’t pay your current group TPA, your company can be eliminated from group and you will have to pay your full undiscounted premiums.
For payroll reported in 2012, the minimum for officers, partners, sole proprietors, etc. is $405 per week or $10,530 per six months.
The maximum is $1,214 weekly or $31,564 per six months.
You must report the actual payroll if it is between the minimum and maximum.
Here’s the link to the BWC web page that addresses how to calculate the correct premiums and who else is subject to the minimum/maximum reporting requirements. http://www.ohiobwc.com/employer/services/paidcomp/paidcomp.asp#minmax
This page also includes FAQ and the payroll caps for construction workers.
Bonnie’s opinion: It would be GREAT if the BWC would include a warning on the payroll reporting page to check for the minimum and maximum, plus a link. That would save companies and the BWC time and money. See my post dated 9/29/11 BWC cancels policy when no monies are due for my rant on this subject.
Ohio workers’ comp premiums are due by August 31, 2012. Payment must be received by the BWC on or before 8/31/12. Mailed payments must be received, not postmarked, by 8/31/12. The BWC is more strict than the IRS!
If you report your payroll and pay your premium in full on line, the BWC will automatically calculate a 1% Go Green discount, up to $1,000 each six months. You will not get the Go Green discount if you only pay the $50 minimum administrative cost.
If you choose the 50/50 option to pay half of the premium due now, the BWC will send you an invoice when it’s time to pay the 2nd half. You will not get the Go Green discount.
You can also choose to report payroll now and schedule an ACH transfer from a savings or checking account to the BWC at a later date.
Go to www.ohiobwc.com and click on Pay Premium in the middle section. Enter your policy number. Follow the prompts to enter your payroll. The BWC will calculate your premium and ask how you want to pay it. When you are finished, be sure to print the Payroll report confirmation and your Certificate of Premium Payment.
POST YOUR COVERAGE CERTIFICATE including the bottom section titled REQUIRED POSTING with all the other employment posters. This will protect you, the employer, if any of your employees test positive for drugs or intoxicants when they are injured.
My daughter signed up for workers’ comp coverage because she is working as spot labor for a number of people this summer and she wanted to be covered in case she got hurt. Even before the BWC assigned a policy number, she got a solicitation from a group TPA offering to get her into group rating through the Grow Ohio program.
The minimum cost to maintain Ohio workers comp coverage is $50 each six months. No discounts, including group rating, will change that minimum payment.
It’s unlikely that she will make enough to have to pay more than the $50 minimum premium each six months, but the group TPA has asked for $75 to get her a discount.
Takeaway: Check what your required costs will be before paying anyone to “save” you money.