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Pay-As-You-Go Worker's Comp: Cost Advantages For Businesses - Mission to Grow: A Small Business Guide to Cash, Compliance, and the War for Talent - Episode # 99
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While most business owners know they need workers comp, few know how to make it work efficiently for them. Here to explain the benefits of pay as you go workers comp is Vice President of Partner Strategy at E-COMP, Robert Campbell.
Robert joins Mike Vannoy to share why pay as you go workers comp is a crucial tool for managing your cash flow. Robert also shares the risks of mis classification, the need to automate payments, and why you should always require contractors to carry their own workers comp.
Takeaways:
- Business owners need to understand that pay as you go workers comp is ultimately a cash management tool. Any small business needs to be focused on cash management, and pay as you go workers comp lets you hold onto your cash for longer.
- Paying your taxes a year in advance would cause undue financial strain, and paying your workers comp in advance has the same disadvantages. By paying as you go, you pay more accurately, and keep your assets liquid.
- Managing different workers comp class codes requires careful documentation. If during an audit, you can’t document the split to an insurance company's satisfaction, you will pay the highest rated code for everyone.
- While your state may not require 1099 workers to carry their own workers comp insurance, you should still require it as a policy. Otherwise you open yourself to issues and possible misclassification fees.
- Due to some rounding in the pay as you go process, there can still be a need to perform an audit. As you may estimate expected payroll wages, your actual number for wages may differ, resulting in the need to audit.
- While you can report pay as you go workers comp manually, having an automatic integration saves both time and effort. Automation sends data directly to your insurance provider, and significantly reduces the risk of error.
- When you are making manual payments and notifications are getting mailed, it can be easy to miss a bill or audit notification. By keeping things digital, you protect yourself from missing important notifications and having your policy canceled.
Quote of the Show:
- “There are people that just ignore their audit. Which is always a terrible idea.” - Robert Campbell
Links:
- LinkedIn: https://www.linkedin.com/in/robertcampbellsdriven/
- Company Website: https://ecompnow.com/
Ways to Tune In:
- Spotify: https://open.spotify.com/show/2XThTdn7YC1lkAm0PgZUkj
- Apple Podcasts: https://podcasts.apple.com/us/podcast/mission-to-grow-a-small-business-guide-to-cash-compliance-and-the-war-for-talent/id1725890976
- Amazon Music: https://music.amazon.com/podcasts/328dddd0-3c4f-4b07-a0d3-13bdcb418486/mission-to-grow-a-small-business-guide-to-cash-compliance-and-the-war-for-talent?refMarker=null
- Audible: https://www.audible.com/pd/Mission-to-Grow-A-Small-Business-Guide-to-Cash-Compliance-and-the-War-for-Talent-Podcast/B0CS71KQFM?qid=1706208857&sr=1-1&ref_pageloadid=not_applicable&ref=a_search_c3_lProduct_1_1&pf_rd_p=83218cca-c308-412f-bfcf-90198b687a2f&pf_rd_r=A1ME8MBECSVZ6K4D7CNT&pageLoadId=QBtg12mqKsuZPLGY&creativeId=0d6f6720-f41c-457e-a42b-8c8dceb62f2c
- Podchaser: https://www.podchaser.com/podcasts/mission-to-grow-a-small-busine-5591006
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