Florida Workers Compensation Rates Are Declining in 2020

Workers Comp Premium In Florida will be cheaper in 2020

In 2020, Workers Compensation Rates are going to be 7.5 percent less compared to Florida Workers Comp Rates 2019. This represents the third consecutive year of declining workers compensation insurance premium. This is a larger decrease compared to the recommended decrease of the National Council on Compensation Insurance (NCCI). According to officials with NCCI, the decrease is due to improving technology, safer workplaces, better risk management, and a long-term shift from manufacturing to service sectors.

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Florida Workers Compensation Rates Volatility

Volatility has been constant in the workers compensaiton market for the past five years. Fortunately, Florida Workers Comp Rates in 2020 are moving in a positive direction.  The uneasiness within the workers comp market really began in 2016. 2016 is when the Florida Supreme Court made two rulings that impacted the workers compensation system. Those two court cases were  Castellanos vs. Next Door Company and Westphal v. City of St. Petersburg. Additionally, the state legislature in Florida also passed Senate Bill 1402.

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Castellanos vs. Next Door Company

Castellanos vs. Next Door Company was a court case that overruled a previous 2009 decision. The 2009 decision limited the amount a judge could award for attorneys fees in workers compensation lawsuits. Because of these limitations, most of the amount awarded went to legal fees. After the Castellanos vs. Next Door Company Ruling, judges merely had to use the previous fee schedule as a recommendation, but depending on the situations surrounding each case they could award more or less for attorney’s fees.  This court case accounted for 10.1 percent of the average statewide increase.

Westphal v. City of St. Petersburg

Westphal vs. City of St. Petersburg was a court case that dealt with the 104-week statutory limitation on temporary total disability benefits. This ruling made the statutory time period unconstitutional. The ruling extended this time period to 260 weeks. Because of the additional 156 weeks, insurance carriers expect to pay out significantly more for these types of claims. This court case accounted for 2.2 percent of the entire increase in 2017.

Senate Bill 1402

The final issue that caused workers comp rates to rise in 2017 was Senate Bill 1402. This was related to updates within the Florida Workers’ Compensation HCPR Manual. This bill accounted for the final 1.8 percent increase on premium for workers’ compensation in 2017.


Key Points when Considering Garage Keepers Insurance

What is Garage Keepers Insurance?

To make an informed decision about purchasing insurance for a car dealership, garage, or auto repair shop; first you need to know exactly what Garage Keepers Insurance is. Garage Keepers Insurance is designed to protect a garage business for loss to a customer’s auto when it is left in the care and supervision of the business. Think of this as protection for auto repair shops, garages, and car dealerships looking to block more risk when it comes to attending, servicing, repairing or storing autos in their garages or on their premises. Here are three aspects to consider when determining whether to buy this coverage and if so, what limits you need.

Car, Mechanic, Automobile, Service, Repair, Auto

The Differences Between Garage Keepers and Garage Liability?

A Garage Liability Insurance is a specific type of insurance policy. A Garage Keepers Policy protects clients against damage to a customer’s vehicle including fire, theft, extreme weather, and vandalism. This policy, however, does not cover damage that occurs from things like faulty workmanship, parts or out-of-date warranties. The policy covers garage and auto body shops for both bodily injury and property damage. This type of a liability insurance policy is designed to protect incidents that involve ownership, maintenance, or use of locations for garage business operations.  Some carriers offer the ability to extend liability for cardealerships to cover all autos on a car lot. This would include both cars to be sold and cars having maintenance performed.

Don’t forget to ask about Limits, Deductibles and a few other details

During the buying process, every business owner must decide what type of deductible and the limit they are comfortable with. This decision will determine what the business pays for annual premium and how much the insurance carrier will pay out in the event of a claim. Two things to be aware of when deciding on this coverage is if the policy is Comprehensive or if the policy has Specified Causes of Loss. Comprehensive coverage covers the damage to a customers auto from any cause. Often there are a few exceptions that commonly include  the auto’s collision with another object or the auto’s overturn. A garage keepers liability policy that is the specified causes of loss are cheaper compared to comprehensive policies, but they do not cover damages cause dby fire, lightning, or explosion; theft; or mischief or vandalism.

Coverage for these policies can be sold with two deductibles. One applies to each vehicle and the other applies to each event. Having an extended conversation with your insurance agent is a great way to determine if you need this policy and if so where your limit should be. The size of a businesses facility, the revenue of your business, and how many vehicles the business commonly has in possession will all determine the amount of liability needed by any particular business.

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What Types of Liability are Covered?

There are three main types of liability covered by a Garage Keepers Policy. Those three types of liability are

  • Legal Liability
  • Direct Primary
  • Direct Excess

Legal Liability

Legal Liability is the most common form of liability that cuases a business to file a claim on a Garage Keepers Liability Policy. This typoe of claim deals with damage to a clients claim because of negligence by the insured. An example of this is when a mechanic is involved in an accident while test driving a vehicle.

Direct Primary

DIrect Primary Liability covers the customers vehicle regardless of liability. When a loss occurs that is not the fault of the insured (the business), this type of liability kicks in to cover the loss. Weather related damage and theft are the two most frequent reasons for this type of claim.

Direct Excess

Direct Excess is very similar to direct primary, but only pays in excess of any other collectible insurance. This type of policy is much cheaper to secure, but does come with the business taking on an additional portion of the losses when a large claim occurs.

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Exclusions to Consider

Before pulling the trigger on any insurance policy, a business owner needs to have a full undertanding of the exclusions involved with any policy they are purchasing. Common included exclusions for a Garage Keepers Insurance Policy include: theft by an employee, defective parts, faulty work, mobile radios, scanners, radar detectors, CD players, speakers or any equipment not permanently installed in the vehicle.


What is OSHA and how does it impact Workers Compensation?

OSHA stands for the Occupational Safety and Health Administration. This government organization is part of the United States Department of Labor. It is the department within the government in charge of the safety and health of workers in the workplace. If you have employees in your business, you need to know about regulations. Any business with one or more employees must comply with OSHA regulations. Here is some information about the history and the three main aspects of the organization.

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OSHA was created in 1970 as part of the OSHA Act. This act created to ensure safe and healthful working conditions, as well as to to preserve human capital throughout the workforce of the United States. One primary aspect the training and education of OSHA focuses on is accident prevention. Prior to this act, there were no laws in place to specifically address safety and health in the workplace. Congress created this act in response to workplace accidents amounting to 14,000 worker deaths annually. Since its inception, OSHA has cut the work-fatality rate by more than half. There are three tactics the organization uses to improve workplace safety throughout the United States:  Education, Training and Enforcement.

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One aspect of OSHA that far too many businesses do not realize is their focus on Education and Training. The OSHA Training Institute (OTI) Education Center Program was created in 1992 as a response to a growing number of requests for training from private sector personnel and Federal personnel from other agencies increased throughout the 1980’s. The two most popular courses currently include the #500 Trainer Course in Occupational Safety and Health Standards for the Construction Industry and #501 Trainer Course in Occupational Safety and Health Standards for General Industry. Additional courses include topics such as Hazardous Materials, Machine Guarding, Ergonomics, Confined Space, Excavation, Electrical Standards and Fall Arrest Systems.


OSHA is most known for enforcement and instituting fines, but arguably the most important part of OSHA is Employee Training. As part of its duty to keep the workforce safe and productive, OSHA requires all businesses to create an emergency action plan and take steps to set up a training program to train all employees in all aspects of the OSHA plan. What must be included in this plan is how to deal with hazardous substances, blood-borne pathogens, emergency situations, and what to do if an inspector comes to your workplace.


In addition to education and training, OSHA is tasked with enforcement. This is what the organization is most known for. Officials can issue fines ranging into the tens of thousands of dollars for violations, and they can refer violators for criminal prosecution if they deem such action is warranted. Any business with employees must comply with regulations. If your small business had 10 or fewer employees during the last year, you don’t have to file an injury or illness reports, but you still must comply with all other regulations. It is the responsibility of the business owner to ensure their business and all employees are trained to be in compliance with OSHA Regulations.

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California Workers Comp Rates 2020 are Declining 5.7%

Marking 5 Consecutive Years of Continuing Declines

California Workers Comp Rates 2020 are going to cost the business community less. This is because in August of 2019, the Workers’ Compensation Insurance Rating Bureau (WCIRB) voted to lower Workers Comp Pure Premium Rates by an average of 5.7% below the rates of 2019. In 2019 Rates were down 23.5 percent compared to what businesses paid in 2018.  This year marks the fifth year of declines and the ninth consecutive biannual decrease dating all the way back to 2015. These decreases mark a total decline of approximately 44 percent.

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What is contributing to Declining California Workers Compensation Rates in 2020?

As of  Jan. 1, 2020 advisory pure premium rates are $1.58 per $100 of payroll. This represents a significant decline of 5.7% compared to California Workers Comp Rates 2019. These declines are continuing because of continued downward loss development, claim settlements accelerating, declining pharmaceutical costs, as well as a decline in the number of filed liens. When this many factors are improving, insurance carriers are able to pass some of those savings on to the businesses purchasing coverage.

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What is limiting the declines from being larger?

California still suffers from the most expensive workers comp rates in the entire country. There are numerous reasons rates remain high despite multiple years of declining premium. In the filing, the WCIRB also noted that factors such as increases in cumulative trauma claims, rising claim severities and continued high levels of allocated loss adjustment expenses are moderating the pure premium rate declines and warrant continued monitoring.

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Information about Inclusions and Exclusions for California Workers Comp

In the state of California, all employers are required to purchase workers comp regardless of the number of employees. Sole Proprietors are not automatically included for coverage and are not required to carry coverage on themselves. SOle Proprietors are allowed to be included if they so choose by using the Acord 130 application. Partners are automatically included for coverage and are not allowed to be exempt. Corporate Officers, who are the sole shareholder, are excluded from coverage. LLC Members who work within the business are included for coverage unless the elect to be covered using the Acord 130 form.

Payroll Requirements for California Business Owners in 2020

The Payroll Requirements for Sole Proprietors who decide to include themselves for coverage is a minimum payroll amount of $52,000 and a maximum of $133,900 for rating purposes (As of 01/01/2019). Partners, Officers and LLC Members who are included for coverage must utilize a minimum payroll of $52,000 and a maximum of $133,900 for the purpose of rating workers comp premium (As of 01/01/2018).


Joisted Masonry (5022)

Joisted Masonry is a part of NCCI Class Code 5022. Joisted Masonry is also one of six building construction categories established by Insurance Services Office, Inc. (ISO). These six categories are part of the Commercial Lines Manual (CLM) and is designed for the purpose of developing rates for insuring commercial property bas upon the likelihood of damage by fire. The CLM description of Joisted Masonry (5022) Construction is considered a building with exterior walls of masonry or fire-resistive construction equipment rated for not less than one hour and with combustible floors and roofs.


Image result for Joisted Masonry

This classification includes worked done on exterior walls with combustible floor and roof. The types of materials used in these walls include adobe, brick, concrete, gypsum block, hollow concrete block, stone, tile, or other similar materials. The code associated with Joisted Masonry (5022) Construction ranks a facility 1-6 based upon how fire resistant the facility is that the business is located or is working on.

Joisted Masonry, Exterior walls, floors, and roof of masonry or fire-resistive materials.

ISO Class 1 is Called Frame. 

Exterior walls of wood, brick veneer, stone veneer, wood ironclad, or stucco on wood. (Construction Code 1)

ISO Class 2 is Called Joisted Masonry (5022).

Exterior walls of masonry material (adobe, brick, concrete, gypsum block, hollow concrete block, stone, tile, or similar materials) with combustible floor and roof.

ISO Class 3 is Called Non Combustible

Exterior walls, floor, and supports made of metal, asbestos, gypsum, or other noncombustible materials.

ISO Class 4 is Called Masonry Non Combustible. 

Same as joisted masonry except that the floors and roof are of metal or other noncombustible materials.

ISO Class 5 is Called Modified or Semi Fire Resistive.

Exterior walls, floors, and roof of masonry or fire-resistive material with a fire resistance rating of at least 1 hour but less than 2 hours.

ISO Class 6 is Called Fire Resistive. 

Exterior walls, floors, and roof of masonry or fire-resistive materials with a fire resistance rating of at least 2 hours.*

How a Business Benefits from a Modified Hammer Clause

Full and Modified Hammer Clauses help take emotion out of the decision to settle a lawsuit. 

In many industries, the reputation of a person or business is paramount. When a business faces a lawsuit, some business owners value their reputation more then they value the cost to settling a lawsuit. Insurance carriers have decades of historical data that allow them to fairly accurately predict how much a lawsuit will cost to fight. In most cases, it is more cost effective to settle for a certain amount as opposed to fighting a claim in the court of law. When a business owner decides to fight a lawsuit, a Hammer Clause is in place to force the business to take on some or all of the costs associated with fighting the lawsuit. The Hammer Clause deals with the additional costs on top of the settlement offered. These clauses are offered in two ways: Full and Modified. A Modified Hammer Clause is the most common form of Hammer Clause because it gives the business owners options, but requires the business to take on some of the risk.

Hammer, Nails, Wood, Board, Tool, Work, Construction

A Full Hammer Clause is put in place to force a business to settle for the recommended amount or take on the full costs in addition to the recommended settlement. When a Modified Hammer Clause is in place the insurance carrier agrees to split the amount of the additional costs with the insured. This is the amount in addition to the recommended settlement plus defense costs. Modified Hammer Clauses are most often offerred in one of two ways. Those two ways are coinsurance percentages of 50/50 and 70/30. This represents the amount the insurance carrier is willing to pay to fight a laawsuit instead of settling. If the Modified Hammer Clause is 70/30 the insurer pays 70 percent of the additional costs, but the business is responsible for 30 percent of the additional costs. The total amount an insurance carrier will pay is limited to the limits of the policy. It will not cover the entire amount of the lawsuit. This is a major reason why Hammer Clauses are in place. To force or encourage a business owner to settle for a well-calculated amount and take emotion out of the decision.

Full Hammer Clause

A Full Hammer Clause can take emotion out of a decision

A Hammer Clause is a clause within an insurance policy that allows an insurer to force the insured to settle a claim for an amount they recommend. A Hammer Clause is also known as a blackmail clause, settlement cap provision, coinsurance or consent to settlement provision. There are multiple ways the clause can be set up. The two most common are a Full and a Modified Hammer Clause.

Hammer, Nails, Wood, Board, Tool, Work

The Full Hammer Clause is a provision within an insurance policy that states, if the insured refuses to settle for a recommended amount, the insurance carrier will pay only the amount for which the claim could have been settled, plus defense costs incurred up to the limits of the policy. When a Full Clause is in place, the insured takes on the full amount of the additional settlement costs.

A Modified Hammer Clause gives the insured the option to refuse to settle, but they take on some of the additional costs to settle the case. In most instances, if the costs are more than the offered settlement the insurance carrier and the insured split the additional costs 50/50. Some policies even require the insured to take on a split as high as 70/30.

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Why might a Full Hammer Clause be beneficial?

A Full Hammer Clause, in most cases, is in the best financial interest of the insurer. Much of the time, it is in the financial best interest of both the insurer and the insured. One thing for a business owner to remember is that insurance carriers interact with businesses facing insurance claims on a daily basis. The carriers have historical data about the costs to defend a business through the court system. This data allows the insured to make a fairly accurate assumption about how much the claim will cost to litigate. Far too often, business owners allow emotions to get in the way of sound judgment. A Full Hammer Clause gives the Insurance Carrier the ability to force the insured to take a recommended settlement in order to avoid additional costs. No matter what type of Hammer Clause is in place it is usually in the best interest of the business to take the guidance of their insurance agent and insurance carrier.

Amazon Delivery Service Partner Program

The Amazon Delivery Service Partner Program is a brand new partner program of Amazon. The intentions of this program are to allow drivers to become their own boss by starting a small business and being assigned a route to deliver for Amazon. Some businesses are even offered a number of routes by Amazon. The program has developed because of an ever-growing demand of packages needing to be delivered for Amazon. This Amazon Partner Program has very strict guidelines that new business owners must follow in order to be offered an Amazon Delivery Service Partner Route. Once approved, the new business owner is offered a number of benefits a traditional delivery business does not have.

The Ten Primary Benefits Include:

  • Workman, Delivers, Three Boxes, Isolated, Box Mover for an Amazon Delivery Service Partner Owner Training
  • Employee Training
  • Technology
  • On-Demand Technical Support
  • A Dedicated Account Manager
  • Exclusive Pricing on Amazon Branded Vans
  • Vehicle Maintenance
  • Accounting Services
  • Legal Support
  • 20 Years of Logistics Experience


Owner Training

Amazon Provides an extensive three-week training program for new business owners. This program is a requirement before business owners start delivering for Amazon as a part of this program. The first week is an introduction to Amazon in Seattle. The introduction is followed by two weeks in the field working alongside an existing owner and driver. This portion of the program is engineered to help new owners learn the tips and tricks of operating a successful delivery business.

Employee Training

Part of the training for new business owners includes detailed information about how to hire and train new employees. Recruiting and retaining superior drivers are an ongoing part of the success of your operation. Amazon has high standards and have developed a customer-obsessed culture. This culture demands the business owner to motivate their team to exceed expectations on every delivery.

Technology for An Amazon Delivery Service Partner

Technology can be extremely expensive. Few industries rely on accurate accounting of products and services more then a delivery service business. Amazon has technology specifically designed for the drivers and the business of Amazon.

Logistics, Personal, Group, Gears of an Amazon Delivery Service Partner Business

On-Demand Technical Support

Amazon provides their partner business owners with on-demand technical support. When a business relies on technology for crucial aspects of the business, the technology the business depends upon is eventually going to fail. Amazon has dedicated technical support just for Amazon Delivery Services Partners.

A Dedicated Account Manager

Each Amazon Delivery Service Partner is assigned their own dedicated Account Manager to serve as a point of contact for communication throughout Amazon.

Exclusive Pricing on Amazon Branded Vans

Purchasing or leasing vans is a large expense for a delivery business. Amazon has vehicles that are designed specifically for the type of work Amazon Delivery Services Partners perform.

Auto Repair, Oil Change, Oil, Auto, Shop, Repair, Work, Vehicle Maintenance for an Amazon Delivery Service Partner Business

Vehicle Maintenance

In addition to offering special pricing on Amazon Branded Vans, Amazon offers a vehicle maintenance program specifically designed for The Amazon Delivery Service Partner Program.

Accounting Services

Keeping the books straight can tremendously difficult for a start-up. Especially as the start-up grows at a rapid pace. Amazon offers their qualified partners help through their own accounting services designed specifically for the Amazon Delivery Services Partner Program.

Legal Support for An Amazon Delivery Service Partner

I addition to accounting services, Amazon provides their certified partners with some legal support when the need arises.

20 Years of Logistics Experience

Probably the most valuable aspect of partnering with Amazon is access to the wealth of knowledge that comes with 20 years of logistical experience. Amazon is one of the biggest businesses in the world and it has been for many years. As your business grows, you can leverage this partnership to gain access to Amazons vast experience.

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If you currently are or are considering becoming an Amazon Delivery Service partner, you eventually are going to need Amazon Delivery Service Partners Insurance. My Insurance Question is a part of the Insurance Shop LLC. The Insurance Shop has developed relationships with multiple carriers who are hungry to offer coverage to businesses operating in this niche industry. Give us a call at 800-800-4864 to speak with one of our insurance specialists today.


Employment Practices Liability Insurance (EPLI) for Small and Medium Sized Businesses

Employment Practices Liability Insurance (EPLI) is a type of liability insurance that covers a business for wrongful acts that occur throughout the employment process. According to Trusted Choice, over the last 20 years employee lawsuits have risen roughly 400 percent. Wrongful termination suits have increased more than 260 percent during that same time period. Additionally, according to a study done by Advisen, only 23 percent of companies with fewer than 100 employees have a Employment Practices Liability Insurance Policy in place. This means 77 percent of companies in the United States who have fewer than 100 employees are exposed to the full liability of an employment related lawsuit. In many cases, a small business is forced to close when faced with an employment related lawsuit. Adding an EPLI Policy to a businesses Business Owner’s Policy (BOP) is the most wise decision to properly protect most businesses.

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The most common way a business faces a lawsuit that causes a employment lawsuit is through wrongful termination, discrimination, sexual harassment, and retaliation. Far too many business owners think their employees will never sue them. This is a thought that sinks far too many business owners. Especially considering how an EPLI policy can be added to most Business Owners Policies (BOP) for a relatively small amount compared to the costs of an actual lawsuit.

An Employment Practices Liability Insurance Policy (EPLI) is written on a claims-made basis. This means the policy will cover the business depending upon when the lawsuit is filed, not based upon when the action within the lawsuit occurred. Some types of insurance policies are sold on an Occurrence basis, but not most EPLI Policies. No matter which type of policy you go with, it is important to make certain, the business owner and management know exactly what type of policy they are purchasing. It is equally important to know exactly what is and is not covered by these policies.

What is Covered by an EPLI Policy?

There are many things that are and are not covered by an EPLI Policy. Some common types of lawsuits that are covered by an EPLI Policy are wrongful termination, retaliation, sexual harassment, discrimination, breach of contract, negligent evaluation, failure to promote, wrongful discipline, deprivation of career opportunity, wrongful infliction of emotional distress, and even mismanagement of employee benefit plans. Not all policies will cover all of these lawsuits. Each carrier has their own specific exclusions. It is important to develop a working relationship with your insurance agent to fully understand what is and what is not covered by each particular policy. Working with an independent insurance agent is a great way to get unbiased advice from an insider. A captive agent will only be able to tell you the positive sides of the policy their carrier offers. An independent agent can offer you coverage from multiple carriers and give you inside knowledge about the positives and negatives of partnering with each carrier.

What is not Covered by an EPLI Policy?

An EPLI Policy covers many forms of employment risks and the costs associated with related lawsuits. Each carrier has their own specific exclusions related to all insurance policies. This is especially true when it comes to an Employment Practices Liability Insurance Policy. Some common exclusions include violations of the National Labor Relations Act, the Worker Adjustment and Retraining Notification Act, Occupational Safety and Health Act (OSHA), and the Employee Retirement Income Security Act (ERISA). Some carriers include exclusions for violations of the states individual workers compensation laws. In addition to breaking laws, most EPLI Policies do not cover punitive damages.

How can a Business Limit EPLI Lawsuits?

When a business decides to purchase an EPLI Policy, there are many elements of the business that a carrier takes into account when they determine what to charge the business for insurance premium. In an ideal world, a business will never face a lawsuit of any kind. Limiting the frequency and severity of all insurance claims is the best business practice. Hiring experienced human resource professionals, developing a thorough onboarding program for new hires, and implementing a well-documented safety program are all excellent ways to lower insurance claims of all types. These programs can also help limit employment related lawsuits.

In addition to limiting all types of insurance claims, there are several things a business can focus on that can limit the business facing an employment related lawsuit.

  • Hire Selectively
  • Thoroughly Educate Management and Staff
  • Establish Clear Policy and Procedures
  • Provide Clear and Concise Job Descriptions
  • Provide ongoing Employee Reviews
  • Document Everything

Hire Selectively

When it comes to hiring selectively, it is important to thoroughly screen all employees. There are a number of ways to do this. A business can hire experienced Human Resource Professionals Internally or outsource this duty. If the business has the funding, it may be best to outsource with the help of an internal human resource professional. No matter how your business decides to approach hiring, it is important to find and promote the right people.

Thoroughly Educate Management and Staff

If a business is concerned about limiting an employment lawsuit, focusing on training management and staff should be at the top of the priority list. Some of these topics may not be comfortable to discuss, but it is necessary to discuss these topics in order to prevent an employment lawsuit. Including diversity and sensitivity training as part of your ongoing training plan is worth considering.

Establish Clear Policies and Procedures

It is equally important to create clearly written policies and procedures for all divisions, departments, teams, and individual employees. Post these policies in a handbook you give to all new hires and some of the highlights should be posted in common areas where all employees have access to them. In addition, it is important to create a formal policy for how an employee can report concerns and a way for management to respond.

Provide Clear and Concise Job Descriptions

One thing that is common in many employment lawsuits is expectations that are in very different places from the perspective of the company compared to the expectations of the employee. If you can develop clear and concise job descriptions and expectations for all employees, it will go a long way towards preventing any and all lawsuits.

Provide Ongoing Employee Reviews

In an effort to open communication with all employees, employee reviews should be held regularly. These reviews should be held regularly in order to keep everyone on board with what is expected of them and what is expected of the company. In the past, these reviews would be done on a yearly basis. In today’s business environment, it is important to have these conversations more frequently. The conversations do not need to be weekly or even monthly, but they need to be more frequent than once a year. When managers meet with employees, it is important to ask open ended questions and to actively listen to the concerns of the players.

Document Everything

Each business will find a different way to prevent employment lawsuits. As a business develops the best plan to prevent employment lawsuits, it is important to document every step of the process. When a lawsuit does occur, this documentation may be the difference between a lawsuit being a slight hiccup and something that causes the business to close its doors permanently.

Clerical Office Employee

NCCI Class Code 8810 | Clerical and Office Employee

In most states, classification code 8810 is meant for Clerical and Office Employees. What distinguishes an employee as a clerical or office employee is difficult for many businesses to determine. Because of this difficulty, 8810 tends to be one of the most misused, misunderstood and most common misclassified class codes.  Many businesses improperly place some or all of their staff in this classification code because the business will enjoy some of the lowest rates for workers compensation premium of any classification code.

An Office Employee going over their notes before an important business meeting.

In many instances, a business owner will attempt to place all employees under the classification code 8810 – Clerical and Office Employee. This is because this class code enjoys the lowest rates for workers compensation premium. Some of the employees may actually belong in this class code, but often times a majority of them do not. The main qualification to be listed in this class code is that the employee needs to always perform their job where there is some form of physical separation from employees engaged in other high hazard work *think walls and doors). Employees in this classification should also not have any type of contact or supervisory role over employees involved in physical labor. The area an employee classified as 8810 –  Clerical and Office Employee should also be separate from any storage areas where inventory is secured.

When an office employee begins to perform any duties outside of their clerical duties, they more than likely need to have a different classification. This may include something as simple as walking or driving off the property to get the mail. A good example of this would be when a non-profit has a program director who spends a majority of their work week behind a desk, but they also have direct supervisory duties. Because these supervisory duties take them away from the office and force them to interact with the general public and the entire staff involved with other exposures, the employee cannot be classified 8810. WHen this occurs the employee must be placed the highest rated risk classification represented by those additional duties. Many employers combat this cost by assigning these additional duties to one or a select few employees.

Computer, Laptop, Technology, Office, Business

It is important to pay particularly close attention to the separation of exposure between different work hazards. When an employee is misclassified into a less risky classification code like clerical office employees noc, it almost always gets cleared up during the end of term audit. When it does get noticed, the employer will owe additional premium in order to keep coverage in place moving forward. This can be a significant cost to a business at an inopportune time.


8810 Clerical Office Employees. This is the most common class code utilized and is common to most policies regardless of the nature of business because most businesses have one or more clerical office employees. Common duties include financial, drafting, telephone answering, inside sales, designers, editors, programmers, and general office staff.