Immigration Compliance Alert
To view the latest publication regarding employer compliance issues, check out this flyer by Greenberg Traurig, LLP
LEC Surcharge on Workers Comp Policies
Beginning in 2010, members will see a new Labor Enforcement and Compliance (LEC) surcharge on their workers compensation policies. The LEC surcharge, signed into law as part of state bill ABX4-12 (2009), will fund the Division of Labor Standards Enforcement (DLSE), an agency that works to ensure compliance with wage and hour standards. All California workers compensation carriers are required to collect this surcharge from their policyholders.
The LEC surcharge takes effect for policies incepting on or after January 1, 2010. The amount that insurers are required to collect for this surcharge is a factor of 0.001924 of an employers premium. For more information about surcharges, click on the link below:
http://www.scif.com/pdf/e15311.pdf
State Fund Extends Credit to Businesses Disrupted by Wildfires.
State Fund is offering extended credit terms to policyholders who experienced business disruptions due to the recent wildfires. If you are unable to report payroll figures or submit timely payments because of fire-related impacts, contact State Fund at their Customer Service Center number: (800) 388-0902. They will work with our members to accommodate their needs.
Workers' Comp Premium Assessments on the Rise
The Department of Industrial Relations has completed its annual review of the workers' comp premium assessment rates and to no one's surprise employers will be paying more in 2010. Much of the increase is due to a new user assessment that will complete the move of all of DIR's operations over to user funding -- a change that is intended to remove its operations from the political machinations of the budget setting process.
The assessments cover the operational costs of the Division of Workers' Compensation and Cal-OSHA. The fees also go to pay for the care of injured workers whose employers failed to have coverage and the cost of finding workers' comp cheats. Overall, the 2010 the assessment rates are set at:
|
Fund |
Assessment Rate for Carriers |
Assessment Rate for Self-Insured Employers |
|
Workers' Comp Administration Revolving Fund |
0.015166 |
0.027736 |
|
Workers' Comp Fraud Account Assessment |
0.003986 |
0.006057 |
|
Occupational Safety & Health Fund |
0.003064 |
0.009488 |
|
Labor Enforcement & Compliance Fund |
0.001924 |
0.001924 |
|
Uninsured Employers Benefit Trust Fund |
0.001849 |
0.002345 |
|
Subsequent Injuries Benefit Trust Fund |
0.00105 |
0.001414 |
Source: California Workers' Compensation Institute
The new assessment for 2010 is the Labor Enforcement & Compliance Fund, which will support the operations of the Division of Labor Standards and Enforcement. Previously, these costs were covered by the state's general fund. This year's budget act, however, did provide for some future predictability in the assessment rates. The budget deal set a three year cap on funding for Cal-OSHA and DLSE at 2010 levels that will run through 2013.
The DIR is expected to begin mailing notices and invoices to carriers and self-insured employers next week. An initial installment is due by January 1, 2010, with the full balance paid by April 1, 2010.
