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If you are a business owner hearing the words “workers’ compensation” and “credit'' used in the same sentence, your interest is probably piqued.
It’s no secret that workers’ compensation is a big expense.
So if you’ve heard of the workers’ compensation construction credit you may be wondering what it is and if you are eligible. And if you are eligible, you may be wondering how to go about getting this credit.
Well, we can help! At Berry Insurance we’ve guided several of our commercial clients through getting a discount on their workers’ compensation through Massachusetts’ construction credit program.
So in this article, we’ll explain what the construction credit is, the criteria to qualify, and how to apply for it.
What is the Workers’ Compensation construction credit?
So, what is the construction credit in the first place?
Well, it’s kind of what it sounds like. The state of MA offers discounts on workers’ compensation to businesses with construction operations.
According to the program’s website, “a special premium calculation, which may result in a premium credit for you, will be based on average hourly pay rates for each classification of construction operations.”
Who qualifies for the workers’ comp construction credit?
Unfortunately, not all businesses are eligible for a credit on their workers’ comp. MA businesses will need to meet a few requirements to qualify for the workers’ compensation construction credit. Here’s what you need:
The correct classification codes:
As is implied by the name, the workers’ compensation construction credit is specifically designated for those in construction industries (electrical, plumbing, iron, etc). Therefore, businesses will need employees with specific classification codes in order to qualify.
This chart from the Workers’ Compensation Rating and Inspection Bureau of Massachusetts shows all the eligible codes:
*Image captured March 10, 2022
A minimum wage:
The business will also need to meet certain payroll requirements to qualify for the credit.
Employees with the classification codes we mentioned above will need to be paid a minimum of $18 per hour (at the time of publication: March 2022).
How to apply for a workers’ comp construction credit:
Applying for a workers’ comp construction credit is fairly simple.
You simply need to fill out an application, and the rest is up to the state!
On the application, you will need to provide information including your business name, federal employer's identification number, workers’ compensation carrier and policy number, classifications and their codes, and the total wages paid under those codes.
You should be able to find the necessary payroll information on your 941s.
The application can be filled out online here.
According to the Workers’ Compensation Rating and Inspection Bureau of Massachusetts website “Insureds who are unable to submit their application through the web tool may also be eligible for the credit by submitting a completed application:
by email to: customerservices@wcribma.org,
by fax to: Customer Services #617-439-6055,
or by mail to: The Workers’ Compensation Rating and Inspection Bureau of Massachusetts,
101 Arch Street 5th Floor, Boston, Massachusetts 02110,
Attention: Customer Services
The state will notify you if you’ve been approved and the discount rate you’ve been approved for.
One you have that, you can submit it to your workers’ compensation carrier so they can apply the discount retroactively to your policy. If you paid your policy in full, the carrier will issue a refund. If not, the credit will be applied and any installments remaining would be adjusted.
According to the rules on the application “The completed and signed application must be received by the WCRIBMA no later than six months after the expiration date of the affected policy, or within one month of the time the insured received notice of the Program, whichever is later.”
Save money on your workers’ comp policy:
In many cases, applying for the MA workers’ compensation construction can really help you save some money on your workers’ compensation insurance.
And listen, we know filling out another redundant business application can feel unnecessarily daunting, but trust us, it’s definitely worth it for the discount.
Workers’ comp is expensive, so why wouldn’t you want to pocket a little extra money for that new piece of equipment you’ve been wanting, or a staff appreciation event?
But did you know there are several other ways you can save money on your workers’ comp policy? To learn more, read this article: How to Avoid Being Overcharged for Workers’ Compensation.
