Hey, that’s a BONUS not regular Pay!

I often get the question on what’s not chargeable by an auditor, but what about a simple list of what they can charge for?

Here is a list of what IS chargeable under a workers’ comp audit.  There are variations but this is a good starting point of what is included in an insurance audit!

If you need to refer back to what’s not chargeable, check out one of our prior posts here.  

B. Payroll

 

For purposes of the NCCI Basic Manual, payroll means money or substitutes for money.

1. Includes:

 

a. Wages or salaries (including retroactive wages or salaries).
b. Total cash received by an employee for commissions and draws against commissions.
c. Bonuses including stock bonus plans. (Refer to Rule 2-D-3.)
d. Extra pay for overtime work except as provided in Rule 2-C-2.
e. Pay for holidays, vacations, or periods of sickness. (Refer to Rule 2-G-3 for allocation of payroll for employees subject to more than one classification code.)
f. Payment by an employer of amounts that would have been withheld from employees to meet statutory obligations for insurance or pension plans such as the Federal Social Security Act or Medicare.
g. Payment to employees on any basis other than time worked, such as piecework, profit sharing or incentive plans.
h. Payment or allowances for hand tools or hand-held power tools used by employees in their work or operations for the insured. These tools may be supplied directly by the employee or to the employee through a third party.
i. The rental value of an apartment or house provided to an employee based on comparable accommodations.
j. The value of lodging, other than an apartment or house received by an employee as part of their pay to the extent shown in the insured’s records.
k. The value of meals received by employees as part of their pay to the extent shown in the insured’s records.
l. The value of store certificates, merchandise, credits or any other substitute for money received by employees as part of their pay.
m. Payments for salary reduction, employee savings plans, retirement or cafeteria plans (IRC 125) that are made through employee-authorized salary reduction from the employee’s gross pay.
n. Davis-Bacon wages or wages from a similar prevailing wage law.
o. Annuity plans.
p. Expense reimbursements to employees to the extent that an employer’s records do not confirm that the expense was incurred as a valid business expense.

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