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2019 and 2020 Quick Reference Guide

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2019 and 2020 Quick Reference Guide

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Uniform Statistical Reporting Plan

Experience Rating Plan

Summary of Approved Changes to the Insurance Commissioner’s Workers’ Compensation Regulations Published by the WCIRB
 

This reference guide summarizes the changes to the California Workers’ Compensation Uniform Statistical Reporting Plan—1995 (Uniform Statistical Reporting Plan) and the California Workers’ Compensation Experience Rating Plan—1995 (Experience Rating Plan) approved by the Insurance Commissioner to be effective January 1, 2019 and January 1, 2020. This reference guide was created by the WCIRB as a convenience for its members, agents and brokers, policyholders and others to provide an overview of notable amendments, but it does not contain a description of all approved changes to the Plans. It is not an official regulation and does not bear the official approval of the California Department of Insurance.

 
 
For more details and information on all changes, please view the actual plans, or the WCIRB’s January 1, 2019, Regulatory Filing in the Filings and Plans section of the website:
 

Payroll Minimum and Maximum Changes

Code Phraseology Payroll
Minimum
Payroll
Maximum
7365 Taxicab Operations $37,000 N/A
7610 Radio, Television or Commercial Broadcasting Stations N/A $133,900
9151 Theaters – musical entertainment N/A $133,900
9156 Theaters – dance, opera and theater companies N/A $133,900
9181 Athletic Teams or Athletic Facilities – players, umpires, referees and game officials N/A $133,900
9610 Motion Pictures – production N/A $133,900
8039 Stores – department stores – retail $1,100,000 N/A
N/A Executive Officers, Partners, Individual Employers and Members of a Limited Liability Company $52,000 $133,900

Construction Dual Wage Threshold Changes

Code Phraseology 2018
Threshold
2019
Threshold
5467/5470 Glaziers $31.00 $32.00

Eliminated Classifications

Classification Eliminated Operations described by the eliminated classification reassigned to
4922, Magnetic Tape Mfg. 4250(1), Paper Coating or Laminating
7606, Cable or Satellite Television Companies 7600, Communication Service Providers
8264(1), Paper Stock Dealers 9403(3), Document Destruction, or
9424(2), Recycled Material Dealers
8264(2), Bottle Dealers 9424(2), Recycled Material Dealers
8264(3), Rubber Stock Dealers 9424(2), Recycled Material Dealers
8264(4), Wiping Cloth or Rag Dealers 8032, Stores – clothing, shoes, linens or fabric products – wholesale
8265(1), Iron or Steel Scrap Dealers 8500, Metal Scrap Dealers
8265(2), Junk Dealers 9424(2), Recycled Material Dealers

New Classifications

Classification Established Purpose
9403(3), Document Destruction – including mobile paper shredding As part of the new Recycling and Refuse Management Industry Group to apply to employers that conduct mobile paper shredding and document destruction
9424(2), Recycled Material Dealers – N.O.C. As part of the new Recycling and Refuse Management Industry Group to apply to employers that purchase, sort or consolidate recovered recyclable materials for resale

Additional Notable Changes to the Uniform Statistical Reporting Plan

Effective January 1, 2019

Part 3, Section IV, Special Industry Classification Procedures, Rule 2, Construction or Erection Work, was amended to establish Subrule f to provide direction as to how to classify shop, yard or storage operations when performed in connection with construction or erection operations that are assigned to two or more classifications, one or more of which includes shop, yard or storage operations and one or more of which does not include shop, yard or storage operations.

Part 3, Section V, Payroll – Remuneration, Rule 1, Payroll – Remuneration, and Appendix II, Payroll/Remuneration Table, were amended to provide clear and uniform rules regarding the reporting of equity-based compensation as remuneration, including:

  • Subrule f, Employer Contributory Payments, was amended to direct those employer payments in connection with an employee’s cashless exercise of stock options are included as reportable remuneration and provide direction regarding when the payout of deferred compensation from an employer’s contributions to previously deferred payroll should be included as reportable remuneration.
     
  • Subrule g, Salary Reduction and Cafeteria Benefit Plans, was amended to include stock options, Qualified or Non-Qualified Employee Stock Purchase Plans (ESPP) and equity-based compensation plans, clarify that an employee’s elected deferrals or payroll-based contributions to employee-elected deferral plans are included as remuneration when earned, and provide direction regarding when the payout of deferred compensation from an employer’s contributions to previously deferred payroll should be included as reportable remuneration.
     
  • Subrule q, Stock Options and Stock Purchase Plans, was established to provide direction regarding the inclusion of stock options and Qualified or Non-Qualified Employee Stock Purchase Plans (ESPP) as reportable remuneration. 
     
  • Subrule r, Equity-Based Compensation Plans (Other Than Stock Options and Stock Purchase Plans), was established to provide direction regarding the inclusion of equity-based compensation (other than stock options and stock purchase plans) as reportable remuneration. 
     
  • The following entries in Appendix II were added or amended to reflect the amendments to Rule 1, Payroll – Remuneration: Deferred Compensation – 401K, Equity-Based Compensation Plans (Other Than Stock Options and Stock Purchase Plans), Profit Sharing, Stock Option Plans and Stock Purchase Plans.

In addition to the new and eliminated classifications noted above, the following amendments were made to the Salvage Material Dealers Industry Group:

  • The Industry Group was renamed the Recycling and Refuse Management Industry Group.
     
  • Classification 9403(1), Garbage or Refuse Collecting, was moved into the Recycling and Refuse Management Industry Group
     
  • Classification 9424, Garbage or Refuse Landfill, Transfer Station and Material Recovery Facility Operations, was amended to (1) move this classification into the Recycling and Refuse Management Industry Group, (2) clarify its application to the disposal of medical waste, as well as green waste recycling operations when conducted at garbage or refuse landfill, transfer station or material recovery facility locations that are operated by the same employer, and (3) direct that California Certified Recycling Centers at garbage or refuse landfill, transfer station or material recovery facility locations that are operated by the same employer should be separately classified.
     
  • Classification 8847, Beverage Container Collection or Redemption, was amended to clarify its application and provide direction as to how related operations should be classified.
     
  • Classification 8500, Metal Scrap Dealers, was amended to include the purchase, sorting, consolidation and sale of both ferrous and nonferrous scrap metals, provided metal sales equal or exceed 25% of gross receipts, clarify its application and provide direction as to how related operations should be classified.

The classifications for brewery, winery and distillery employers in the Food Packaging and Processing Industry Group were amended, including:

  • Classification 2121, Breweries, was amended to (1) clarify that it includes the provision of product tasting samples to customers in connection with facility tours; and (2) direct that the operation of retail stores should be separately classified, the operation of restaurants or taverns and the preparation and serving of hot food should be separately classified as 9079(1), Restaurants or Taverns, the operation of taprooms should be separately classified as 9079(1), and that beer making operations at restaurants where the beer brewed on-site is primarily sold to restaurant customers for on-site consumption should be classified as 9079(1).
     
  • Classification 2142(2), Distilling, was amended to (1) clarify that it includes the provision of product tasting samples to customers in connection with facility tours; and (2) direct that the operation of retail stores should be separately classified, and the operation of tasting rooms, restaurants or taverns and the preparation and serving of hot food should be separately classified as 9079(1), Restaurants or Taverns.
     
  • Classification 2142(1), Wineries, was amended to (1) clarify that it includes the provision of product tasting samples to customers in connection with facility tours; and (2) direct that the operation of retail stores should be separately classified, the operation of restaurants and the preparation and serving of hot food should be separately classified as 9079(1), Restaurants or Taverns, and the operation of tasting room facilities should be separately classified as 8060, Stores – wine, beer or spirits.

Part 4, Section II, Definitions, was amended to add the definition of Net Incurred (Loss) for consistency with changes to the Experience Rating Plan.

Part 4, Section IV, Exposure Information, Rule 4, Exposure Amount, was amended to clarify the reporting of estimated exposure when a surcharge pursuant to California Insurance Code Section 11760.1 has been applied.

Part 4, Section V, Loss Information, Rule A, General Loss Reporting Instructions, Subrule 3, Supplemental Claim Information, was amended to eliminate the requirement to report Weekly Wage Amount for joint coverage, partially fraudulent or subrogated medical-only claims, and Rule C, Special Loss Reporting Instructions, Subrule 7, Compromised Death or “S” Claims, was amended for consistency with changes made to the Experience Rating Plan.

Effective January 1, 2020

Individual employees’ annual payroll developed in the classifications listed below will be subject to the USRP annual payroll limitation. The WCIRB will propose adjusted advisory pure premium rates and classification expected loss rates in the January 1, 2020, Pure Premium Rate and Regulatory Filings to reflect the estimated reduction in reported exposure in each classification resulting from the application of the limitation.

  • 7607(1), Video Post-Production – computer or electronic – all employees – including Clerical Office Employees and Outside Salespersons
  • 7607(2), Audio Post-Production – computer or electronic – all employees – including Clerical Office Employees and Outside Salespersons
  • 8743, Mortgage Brokers – no direct lending – all employees – including Clerical Office Employees and Outside Salespersons
  • 8803, Auditing, Accounting or Management Consulting Services – all employees – including Clerical Office Employees
  • 8820, Law Firms – all employees – including Outside Salespersons and Clerical Office Employees
  • 8859(1), Computer Programming or Software Development – all employees – including Clerical Office Employees and Outside Salespersons
  • 8859(2), Internet or Web-Based Application Development or Operation – including Clerical Office Employees and Outside Salespersons

Experience Rating Plan

Effective January 1, 2019

Section I, General Provisions, Rule 7, Rating Forms, was amended to incorporate the requirements regarding data displayed on the Experience Rating Form from Section VI, Tabulation of Experience, Rule 2, Experience Rating Forms, as that rule was eliminated.

Section III, Eligibility and Experience Period, Rule 1, Eligibility Requirements for California Workers’ Compensation Insurance, was amended to adjust the eligibility threshold from $10,300 to $10,000 to reflect wage inflation and the proposed January 1, 2019 expected loss rates.

Section III, Eligibility and Experience Period, Rule 3, Experience to be Used for Rating California Workers’ Compensation Insurance Risks, was amended to incorporate the requirements regarding what data is used in experience rating from Section VI, Tabulation of Experience, Rule 1, Data Used for Experience Rating, as that rule was eliminated.

Section VI, Tabulation of Experience, was combined for clarity with Section VII, Rating Procedure into a single section, Section VI, Rating Procedure, and amended to require that the first $250 of each claim not be included in the experience rating calculation and to simplify the experience modification formula.

Table I, Expected Loss Rates and D-Ratios, was amended to reflect the most current data available.

Table II, Primary Thresholds, was amended to remove the references to credibilities for consistency with changes to the Experience Modification Formula and to reflect the most current data available.

Experience Rating Form – California, was amended for consistency with the Experience Modification Formula.