Most people in Phoenix know that they need to pay taxes or buy insurance for their car. Do you know what you need to do if your company has a work-related injury?
If an employee is injured, then their employer will be required by law to provide benefits such as medical care and disability payments. You should contact a lawyer at Phoenix Workers’ Compensation Attorneys before making decisions about handling your business’s workers’ compensation needs.
Businesses need to understand how this process works to fully know what costs they may incur when hiring new employees. This article will help you calculate workers’ compensation with ease so you can be ready for anything.
How to Calculate Workers Compensation
To calculate employees’ compensation, you will need the following information:
- The number of full-time and part-time workers employed by your business.
- The amount of workers’ compensation insurance premiums for a year.
- A list of medical expenses paid on behalf of each worker during one calendar year.
To calculate workers’ compensation, you can use the following formula:
Workers’ Compensation Claims Paid In Year x Amount of Premiums Paid For Workers’ Compensation Insurance = Total Cost Of Workers’ Compensation.
You can calculate the total cost by multiplying the number of workers who made claims in a given year times their medical expenses, along with premiums paid for your business.
You can then add this number to the cost of your workers’ compensation premiums and any other additional costs related.
How Are Workers’ Compensation Rates Determined?
Several factors determine workers’ compensation insurance rates. These include but aren’t limited to:
- The type and size of your business
- Industry-specific risks. It can be high for some businesses, such as construction, which may increase injuries due to falls or equipment accidents.
- The experience rating of the business is determined by how often your employees get injured and what it costs to treat them.
- The location of your business
The more claims your company makes and the higher their cost, the higher you can expect to pay in workers’ compensation premiums.
Calculate Workers’ Compensation With Online Calculator
Enter the information into an online calculator using this format: (Number Full Time Employees x Number of Hours Worked Per Week / 2080) + (Number Part-Time Employees x Number of Hours Worked Per Month/20). You can then click on “Calculate” and see your results.
Alternatively, you could also check out a workers’ compensation insurance rate calculator online to figure out how much it will cost for your business to have workers’ compensation insurance.
Add Up Payroll for an Employee in a Year
Add together the number of hours worked per week or month by employees. If you have part-time workers, add their numbers to determine how many hours are worked in total. Multiply this number by your business’ premium rate for one year. Add up all medical expenses paid on behalf of each worker during that calendar year. Multiply the total medical costs by your business’ premium rate for one year.
In summary, the cost of workers’ compensation insurance is determined in part by the number of full-time and part-time employees you have. Their average hours worked per week or month, how much they are paid per hour or salary if workers made any claims during the year, and how much it costs to treat those claims.