Telecommuting Class Code 8871 Added To California WCIRB Class Codes
California’s Workers Comp rating bureau (WCIRB) added in Telecommuting Class Code 8871 after a regulatory meeting this week.
If your company is domiciled in California or you have California-based employees, you will need to separate these employees from furloughed employees and 8810 Clerical Administration employees.
The Telecommuting Class Code becomes effective on January 1, 2021. Regardless, preparing your accounting or bookkeeping software to add in this code will save many unneeded headaches when your premium auditor makes their yearly appointment or when you self-report your payroll.
NCCI – the rating bureau for approximately 40 states released their advisory last month on reporting 8871 Telecommuting Class Code for in-home workers last week.
The agenda notes from the WCRIB can be found here. You can search for 8871 in the notes They WCIRB will have another meeting on this and other subjects in August.
From The Meeting Agenda
Item III-A
Clerical Telecommuter Employees
In response to state and local stay-at-home orders necessitated by the Coronavirus Disease 2019 (COVID-19) pandemic, many California employers have limited their employees’ duties to clerical work that can be accomplished from employees’ homes. In view of this recent and significant increase in “telecommuting”, at the April 14, 2020 meeting, members of the WCIRB’s Classification and Rating Committee noted that several other jurisdictions maintain a specific classification for telecommuters and recommended that the WCIRB consider establishing a similar classification so that statistical data can be captured for clerical telecommuter employees.
Currently, telecommuting employees whose duties meet the definition of Clerical Office Employees1 found in the California Workers’ Compensation Uniform Statistical Reporting Plan—1995 (USRP) are assignable to Classification 8810, Clerical Office Employees, or to their employers’ standard classification if that classification specifically includes Clerical Office Employees.
While California does not have a unique classification for clerical telecommuting, the National Council on Compensation Insurance (NCCI), as well as a number of other jurisdictions, use Classification 8871, Clerical Telecommuter Employees, for employees that spend more than 50% of their time performing clerical duties from a clerical work area located within their home, 2 provided the remainder of their time is spent engaged in clerical duties at the employer’s place of business. If 50% or more of their time is spent performing clerical duties at the employer’s place of business, Classification 8810 is applicable.
Since the use of telecommuting will likely grow in California, staff is proposing that Classification 8871, Clerical Telecommuter Employees – N.O.C., be established as a Standard Exception classification applicable to clerical employees who work more than 50% of their time at their home or other office space away from any location of their employer. This will enable the collection of payroll and loss data for these employees to determine if their exposure differs from that of other clerical employees who work primarily at their employer’s office location and will align California with other jurisdictions that assign clerical telecommuters to Classification 8871. Additionally, staff is proposing amendments to Classification 8810, Clerical Office Employees, and Section III, Rule 4, Standard Exceptions, of the USRP for consistency with this proposal.
There are 41 classifications that specifically include Clerical Office Employees and 2 classifications that specifically exclude Clerical Office Employees. 3 When a classification phraseology specifically includes Clerical Office Employees, all clerical employees are assigned to that classification, and not to Classification 8810. As the proposed scope of Classification 8871, Clerical Telecommuter Employees, embraces operations performed by Clerical Office Employees, staff recommends that each of these 43 classifications be amended to also specifically include or exclude Clerical Telecommuter Employees. These amendments are necessary to make clear that all clerical telecommuter employees are also included in, or excluded from, the scope of these 43 classifications.
Telecommuting Class Code 8871 and 8810
Do not rush to move employees after January 2021 from Class Code 8810 to 8871. You will need to compare each of those codes once published by the WCIRB in its final form. Class code 8810 tends to be less expensive than 8871. With the wave of work from home employees, one cannot make that a 100% true cost statement yet.
When the final Telecommuting Class Code 8817 has been published by the WCIRB, I will update this article or add a new one.
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