While most organisations won't see the significant increases in premiums they did last year, it's important to check your Premium Notice carefully to ensure your rate is appropriate.
Last year, the 46% increase in the average payroll premium rate saw almost all Victorian employers endure significant increases in their WorkCover premiums. Thankfully, this year, the average payroll rate remains unchanged at 1.8%.
However, it's important to understand that the payroll premium rate applied to your organisation is based on three key factors and isn't necessarily the 'average' rate.
Your organisation's payroll premium rate is based on:
· Your industry – different rates apply to different industries based on risk.
· Your overall remuneration – it’s important to ensure this is up-to-date and accurate.
· Your claims history and return to work outcomes.
These factors are reported and should be carefully checked to ensure their accuracy and identify opportunities to improve performance and, in turn, future premium ratings.
Go to page 3 of your Premium Notice and check:
Annual remuneration
If you have not provided WorkSafe with an up to date estimate for the period, this will be assessed based on your previous year’s remuneration plus 4.75%.
If this is incorrect, update it immediately through WorkSafe’s Online Employer Services. An adjusted renewal notice should then be issued shortly thereafter.
It is important to note that the rules for declaring remuneration differ to those of the ATO (for example payments to certain contractors should be included). More information can be found here.
If you are unsure, we can review this for you.
Industry classification
Performance rating
What can organisations do to impact WorkCover premiums?
WorkSafe Victoria tells us ‘the best way to ensure you pay the lowest premium is to operate a safe and healthy workplace to prevent injuries from incurring. However, if injury or illness does occur, focussing on achieving a prompt and sustainable return to work outcome will assist in keeping premiums down.’
Improve claims and injury management processes
How your business manages WorkCover claims, injuries and return to work programs has a significant impact on your premium cost. In fact, for larger businesses, each $1 in claim costs can amount to a premium increase of as much as $4 for a number of years.
The complexity that surrounds claims, injury and return to work program management often means that injuries cost businesses far more than they need to and take up valuable time and resources.
As a highly specialised area, effective claims and injury management requires an intimate understanding of the different schemes. For larger businesses managing multiple claims each year, improving the effectiveness of claim management and outcomes can deliver significant savings on a number of fronts.
However, hiring an internal Workers Compensation specialist only makes sense for very large businesses with a high volume of claims, which means that the responsibility typically falls on HR, Accounts or Payroll staff, with minimal or no training in Workers Compensation regulations and limited time to deal with the complexities of claims management. For this reason, many organisations achieve improved outcomes by outsourcing claims and injury management to a specialist provider.
Reduce workplace injuries through improved safety management systems and culture
Not surprisingly, organisations that prioritise safety, regularly review and audit safety management systems and have a positive safety culture that stems from the top down typically have lower incident rates, which in turn results in fewer claims.
By investing in an independent review of your organisation’s safety management systems, you can put measures in place to ensure that:
• Your organisation complies with all relevant safety legislation and requirements.
• Directors and officers are protected from criminal prosecution.
• Risks to the safety and wellbeing of employees are effectively and appropriately managed.
Pay early and pay in full
Discounts are provided to employers who pay their premiums early. If your premium is paid in full by:
• 19 August 2024 you will receive a 5% discount.
• 1 October 2024 will receive a 3% discount.
You also have the option to pay your premium quarterly. To take advantage of the early payment discounts, many businesses choose to finance their WorkCover premiums – which also helps them to manage their cash flow by spreading payments over a monthly plan.
If you’d like to talk to a WorkCover specialist about your Premium Notice or improving your claims management processes, we’re here to help – just call us on 03 9863 8408 or email info@riskstrategies.com.au
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