Workers Comp Budgeting – Where Do Employers Find the Info?
One of the most difficult tasks for employers in the post-pandemic era requires a large amount of data analyses. Workers Comp budgeting adds in more complexities to the mix.
Every week the news cycle produces reports that a certain national chain of stores or restaurants completely closed or substantially reduced their number of stores.
Workers Comp budgets were difficult enough for companies without the pandemic and post-pandemic effects. Employers’ budgets should contain considerations for three simple situations:
- Growth
- Staying the same
- Reduction
Budgeting in general would require these three different budget types. Of course, you are not reading this article to cover general business budgets.
Workers Comp Budgeting = Three Sources
The three sources for your upcoming or current Workers Comp policy year comes from documents you should always keep easily accessible.
Those three sources are:
- Current Workers Comp policy – Declarations Page
- Last years’ accurate premium audit
- Payroll projections for the policy year – the most difficult numbers to calculate due to inflation and the post-pandemic effect. If your policy year does not match your company’s fiscal year, you will need to make that adjustment.
Yes, I do realize that many other documents could possibly be used in the comparisons. Keeping it simple avoids making a complicated workers comp budget comparison.
Matching The Numbers
Comparing the numbers on the above data sources will point you in the right direction. As each employer is very unique – even within the same industry, the best results come from using Excel or another type of spreadsheet app such as Google Sheets or Apache Office – the latter two are freebies.
One can use the old-school method of manually looking over the numbers of the three data sources without using spreadsheets. Do the numbers from the three data sources makes sense if your company is growing, staying the same, or in a reduction phase?
If you feel something is amiss, an email to your agent may readily answer your questions. A business owner’s or corporate executives. intuition remains a powerful force for making business decisions.
