Workers Comp & Payroll Processing - When to Combine the Two & When to Say NO.
If your company has ever utilized a payroll processing company (such as ADP, PayChex, etc) then I'm sure that you have been hard sold on combining your Workers Comp and Payroll processing. In fact, you may have been told that your company HAD to use that Payroll company's "in-house" workers comp option in order to get certain discounts on your payroll processing. This is simply not true & a sneaky tactic of payroll processing companies.
For many organizations, working with an Insurance Broker & Standalone Workers Comp Policy makes the most sense. This is due to many reasons - primarily cost driven & knowledge driven. Insurance Brokers are able to shop many different workers comp carriers to find the best value & are able to work closely to assist with claims and get involved to assist the client if the insurance company's being a bit difficult. Also, some brokers have the knowledge to fight the Workers Comp Rating Bureau to have some of your employees reclassified (if it makes sense & you're paying too much for an employee that's classified as a contractor but is really just performing administrative/ clerical duties).
Also, did you know that working with a Broker & choosing a standalone Workers Comp Policy will still (most often) allow for integration with your payroll processing? There are a few exceptions to this as State Compensa
tion Insurance Fund, Berkshire Hathaway & some Program WC Carriers don't integrate with most payroll companies. This will allow your organization to combine the price & knowledge advantage of an insurance broker with the ease of doing business of a "pay as you go" workers comp option.
For the types of organizations below, it may make sense to combine your workers comp insurance with your payroll processing. Some of these types of companies are listed below.
- Contractors with large discrepancies in their Payroll from Paycheck to Paycheck
- Hospitality Businesses that have large discrepancies in their Payroll from Paycheck to Paycheck
- Start-ups that don't have the money for a large WC Down payment
Please give us a call today if you're interested in getting a Workers Comp Quote for your Business. We partner with most of the major WC Carriers that allow for Payroll Billing and can discuss if this is best for your business.