Workers Comp Question

Discussion in 'Business Operations' started by ETM, Feb 2, 2008.

  1. ETM

    ETM LawnSite Bronze Member
    from Georgia
    Messages: 1,063

    I've got to carry workers comp for my builders we do landscaping for but if I have it,I will be paying payroll for my lawn maintenance. Is there anyway for me to get around this. Last year it cost me $10000. and most of it came from lawn Maintenance.We have liability for LM and I don't need to pay the WC on it. If my guys get hurt cutting grass I will pay for it.Thanks for your reply. we are located in GA and you can't opt out of it.
  2. Gene $immons

    Gene $immons LawnSite Bronze Member
    Messages: 1,028

    Liability insurance will not pay for an employee who is hurt on the job - at least not any liability ins. that I have heard of. Liability covers things that your company might damage while on a property.

    If one of your guys gets really hurt (cuts off hand) I wouldn't want to guess what the medical bills could run.. Tens of thousands of dollars.

    Better to play it safe and get the insurance, this way you can qualify for bidding on the commercial jobs which usually require you to have it anyway.
  3. RHayden

    RHayden LawnSite Member
    Messages: 123

    I'm a little confused. Are you saying you currently have employees but no WC at all right now?
  4. LB1234

    LB1234 LawnSite Gold Member
    Messages: 3,208

    So you are basically asking if you can pay for workmans comp without paying payroll? How do you pay your employees, cash? The attitude of I'll cover my guys getting hurt is down right foolish. One twist of a knee or rock to the eye for permanent blindness and you can kiss your company goodbye in one fell swoop. My opinion is you need to look a little closer at risk versus reward here.

    Sounds like your prime contractor is dotting his I's an crossing his T's. He realizes that since he is subcontracting you out and you don't have WC that those employees could come after his arse as well. Koodoos to him.:drinkup:

    W/C, from what I'm familiar with, is based on payroll. We pay around 11-12 per 100 of payroll. I used to pay a minimum upfront cost to payroll, like $1,000. Then they would audit me at the end of every 12 month cycle and bill me whatever additional WC I owed them. I've since switched to ADP pay by pay insurance and they deduct it automatically from my payroll. IMHO, it works much better for my company. No upfront costs in march when money is not rolling in and only payments made when I run payroll.

    I just don't see the big deal about workmans comp on employees. You make money on your employees so whats the big deal. I pay my guy/s around 12 an hour, so for every 8.33 hours I pay an additional 12 dollars in WC. That works out to be about another 1.5 per hour. So I factor my payroll as 13.5 an hour. If you really want to go nuts, I pay my employees bi weekly. They work between 20-30 hours per week. It costs around 75 dollars to process payroll. Assuming 40 total hours for two weeks its around another 2 bucks an hour for payroll. So, my employees cost me 12 + 1.5 + 2 or 15.5 dollars an hour. I charge anywhere from 35 up to 125 per hour in labor...$3.50 is not going to break the bank. I just don't see the problem.

    But to answer your question (LOL:laugh:) I don't see a way to pay for WC and NOT have payroll.

    TJLANDS LawnSite Bronze Member
    Messages: 1,668

    You could separate your Landscaping from your lawn maintenance by starting a separate company. This would cut down on your payroll at the more expensive rate. In NJ the difference is 3.14 for mowing and 7.41 or higher for landscaping. Only you could figure out if it is worth it.
    It would save you 4500 or so every 100K in payroll.

    LB1234 Must be nice to have employees in NJ that only make 250-350 a week. My average employee is double that.
  6. pyrocare

    pyrocare LawnSite Member
    Messages: 96

    When you are figuring payroll split the different divisions payroll out so that you know which is landscaping and which is lawn maintenance. The rate here is only like 5.3 per 100 in payroll for mowing so in Quickbooks I have the work comp thing set up and when the insurance company audits me I run off the report and it says how many hours and dollars are snow removal and how many are lawn maintenance.
  7. LB1234

    LB1234 LawnSite Gold Member
    Messages: 3,208

    Let me explain more in detail...

    Our 'employees' are college students on break or local college students that have take night classes or are off certain days during the week. So we really don't have "full-time" employees. We pride ourselves in NOT hiring illegals or having to enter into the H2B program.
  8. theturfboss

    theturfboss LawnSite Member
    from Indiana
    Messages: 47

    I agree...I personally know the costs of small injuries (broken ribs, cuts that need stitches, sprains, etc.) that happen at work. Without insurance, your going to pay a higher rate at the doctor because you are not part of a large group that "barters" for a lower price. A trip to the ER, 7 stitches, X-rays, a ct scan, and meds cost me about $7000. Workers compensation is well worth it and I would call it cheap compared to the medical bills. Any one who works for me (part time, seasonal, full time) is covered under workers comp. We use ADP pay by pay and are very happy with how it works and the rates.
  9. LushGreenLawn

    LushGreenLawn LawnSite Silver Member
    Messages: 2,120

    Someone working under the table is an illegal, even if they did not come from mexico.

    I work part time during the Winter, I pay taxes on that money, and my employer provides workmans comp.
  10. LB1234

    LB1234 LawnSite Gold Member
    Messages: 3,208

    And where/when did I state that I did?

Share This Page