About Workers Compensation

In the 5-3-2 Workers’ Compensation window, you can set up the table for workers’ compensation codes, rates, and experience modifiers. Sage 100 Contractor uses the table in conjunction with the workers’ compensation payroll calculation to compute the premium for each code category. How you set up the workers’ compensation codes depends on the requirements for each state.

• Some states use two-tiered codes, where two rates apply to a single category of work.
• Some states require the employer to pay for general liability insurance. Often the liability rates are based on the risk groups, but are not affected by the experience modification.
• Some states use a dollar per hour rate instead of a percent; some use both.
• Some states do not require subcontractors to carry workers’ compensation insurance. Often the general contractors carry the liability insurance burden for the subcontractor.
• Some states, such as Ohio and New York, may include a workers’ compensation value in the Maximum Wage column. (The 5-1-5-21 Worker's Comp report includes the wage maximum.)

Use the compensation codes from the insurer's policy or report whenever possible. Companies with multiple policies may find that the policies share compensation codes. If this occurs, you may need to create a separate numbering system for Sage 100 Contractor to use. Then include each state’s compensation code at the end of the description.

After you have set up the table, you can assign the workers’ compensation codes to the cost codes and employee records. When you enter a timecard, Sage 100 Contractor first looks to the cost code. If Sage 100 Contractor does not find a compensation code, Sage 100 Contractor then looks to the employee record.

It is a good idea to write the expiration dates of your workers’ compensation policies on your company calendar. Also, write a reminder on the calendar one month prior to the policy expiration so you can get quotes for the next policy term. When you renew the policies, adjust the rates and experience modifications in the 5-3-2 Workers’ Compensation Codes window.

A few states have special requirements for calculating workers’ compensation. For more details, seeAppendix D: Tax Setup Informationand help topics about these state’s specific workers’ compensation requirements.