COVID-19 Emergency Rating Changes Take X-MOD – July 2020


THE DEPARTMENT of Insurance has approved emergency workers’ compensation rules dealing with COVID-19 and California employers. The rules were recommended by the Workers’ Compensation Insurance Rating Bureau to bring fairness for employers’ experience rating during the COVID-19 pandemic amid shelter-at-home orders and for dealing with claims of workers who contract COVID-19 on the job. The following new rules took effect on July 1:

1. Classification changes for staff working from home
As a result of the California stay-at-home order, many employers have altered employees’ duties so they can be accomplished from home, and often those duties are clerical-like in nature. Under the rule, an employee can be assigned payroll classification code 8810 if:

  • Their duties meet the definition of a “clerical office employee” while working from home, and
  • Their payroll for the balance of the policy period is not assignable to a standard classification that specifically excludes clerical office employees.

There are a number of other classifications that already include clerical operations in their definitions, and those classifications would not be eligible for a change.

2. Non-working, paid staff
Salaries paid to workers who are at home not working, yet still collecting a paycheck, will be excluded from payroll for workers’ comp premium calculation purposes when the payments are less than or equal to the employee’s regular rate of pay.

3. COVID-19-related claims
Under the emergency rules, all workers’ comp claims directly arising from a diagnosis of COVID-19 will not be included in the calculation of your experience modification. The Rating Bureau said in proposing this change that since the occurrence of COVID-19 workers’ compensation claims are unlikely to be a strong predictor of future claim costs incurred by an employer, their inclusion in X-Mod calculations would not reflect an employer’s safety efforts and would not reflect the intended goal of the experience rating system.

The takeaway
These rules are effective during the time the stay-at-home order by Gov. Gavin Newsom is in effect, and 60 days after the order is lifted. If you have employees who work from home, discuss with your insurance company or us whether you should change the class code to reflect their new duties. If you do reclassify employees or are paying workers who are not working, document those changes too, and keep careful records. Also, worker COVID-19 claims will be eligible for workers’ compensation benefits under a second-order by Newsom, but under these new rules, they will not count against your X-Mod.

Attention !

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WE ARE BACK WORKING IN THE OFFICE!  
We are closely following CDC recommendations and when appropriate, we telecommute.  All client meetings are done via Zoom. 
At Mindful Insurance Solutions, our top priority has always been to deliver best-in-class service to our clients.  We chose the name “Mindful” precisely to be “present and willing to do something” with our clients, and that’s what we always strive to be—present with you in your business. To ensure that we remain true to our name during the current coronavirus pandemic, we are taking every precaution possible to protect the health and safety of our team and their families. Our team is now working at the office, following all CDC guidelines for working in an office and when needed, we are working remotely. Our physical office location is open but all client meetings are via the Zoom platform. We continue to be readily accessible to you. Your emails and phone calls/voicemails will be answered as usual, and our Mindful Insurance professionals will work to meet your needs in all the ways you have come to expect from us. We understand that insurance is a people-oriented industry, and Mindful prides itself on being a people-oriented company.  But while there is no substitute for face-to-face interaction, it is prudent to curtail such interaction as much as possible until things return to normal.  Therefore, Mindful also stands ready to interact with you via remote video/teleconferencing as desired. These extraordinary steps are necessary to preserve the health of our team and to help curtail the spread of the virus while upholding our commitment to you, our clients.  On behalf of the entire Mindful team, I want to thank you for your understanding and support during these challenging times.  We wish you, your families and your teams much good health. In your service, stay healthy and safe, William Donaldson President / CEO


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