Gulfshore Insurance > Gulfshore Blog > Commercial Risk Management > NCCI Rule Change to Exclude Payroll to Employees Not Working for Workers’ Compensation

NCCI Rule Change to Exclude Payroll to Employees Not Working for Workers’ CompensationThe National Council on Compensation Insurance (NCCI) is acknowledging the circumstances around COVID-19 and expediting a rule change that will address the question of payroll for furloughed employees as it relates to the basis of premium. Currently, payroll is included in calculating the employer’s workers’ compensation premium. A workers’ compensation premium is based on payroll.

“The rule change is going to take the payroll for that period of time where the worker is furloughed and remove it from the calculation. This will be distinct from “idle time” under our current Basic Manual rules (Rule 2-F-1), and a corresponding statistical code 0012 will be created for reporting this payroll” said Jeff Eddinger, senior division executive, Regulatory Business Management, for NCCI.

If approved, this rule change will be retroactive, most likely to March 1st. How long the code will remain available will depend on how long shutdowns are in effect.

In another change, NCCI will also begin tracking COVID-19 related claims.

NCCI has a COVID-19 Resource Center on its website that includes answers to frequently asked questions and a new analysis of the economic impact of coronavirus on the workers’ compensation industry. Gulfshore Insurance will keep you updated on this matter as more information is released.

Tim Spear, is a Client Advisor and Partner at Gulfshore Insurance specializing in the construction, oil/petroleum, and landscape industries. Through his consultative and diagnostic approach, he helps clients develop customized programs to meet their risk management needs. Comments and questions are welcome at tspear@gulfshoreinsurance.com