3 Things Restaurants Must Know About Workers Compensation.
Restaurant workers have very demanding jobs and schedules and depending upon the size of the business, employees may be doing multiple jobs and are pulled many directions during a shift. Long hours and a quick pace of business are very common in this industry. These factors make it important to have the right workers compensation policy and the best practices to reduce claims and claims problems.
Business owners will commonly receive multiple quotes for workers comp insurance in an effort to obtain the lowest possible premium. We’re going to share with you today three tips that your company can use to not only pay less for workers compensation but also reduce the indirect costs such as being short-staffed, being sued, or loss of business due to bad reviews.
TRAIN, TRAIN TRAIN.
One of the simplest things that a restaurant can do is have a comprehensive safety training program for new employees and ongoing training for existing employees. This may sound cliché, but the best defense is truly a good offense. If your company can eliminate claims altogether, your business will pay much less for workers compensation and your employees will be at work daily to help your business grow and serve customers.
Common injuries in the restaurant industry can range from severe cuts from sharp knives, burns, or even slip and fall injuries from wet floors. While some of these injuries may be minor in nature, a serious slip and fall accident can cost hundreds of thousands of dollars if surgeries are needed. While the workers compensation carrier will bear the cost of paying for this claim, eventually the business will see increased costs on workers compensation premiums.
Also, keep in mind that your employees need the correct tools to do their jobs correctly & safely. It’s important that your business ensures that employees have the proper protective equipment such as proper shoes to help eliminate some of the simple claims that occur during the normal workday. For example, let’s say you own a barbeque restaurant. You mentioned once that employees shouldn’t wear open-toed shoes. Your new hire, Tami, was so overwhelmed on the first day that she didn’t hear you. She came into work with flip-flops and received a 3rd-degree burn on her foot from spilling boiling water. Now, she needs medical help and files a claim. We recommend you have a training program to review the various safety tools available and what the tools the employee will need to do their job safely. Have the employee sign a document that they have received such training.
There are many insurance carriers that will provide workers comp insurance to the restaurant industry. The reality is though, that not all insurance companies are created equal and not all quotes are equal. We recommend that you partner with an insurance company that offers a 24/7 nurse triage service. This nurse triage service will be your first line of defense when a claim arises for your restaurant for all non-emergency claims. If you have a serious claim, you should always go to your nearest emergency room or urgent care clinic.
Here’s how it works.
When your employee is injured, they call an 800 number and will speak to a registered nurse who will take the injury report directly from the injured worker, and from there the nurse will make a determination as to the type of care needed. One of the advantages of talking to a registered nurse as quickly as possible is the proper care can be given and your team doesn’t have to determine what the best course of action is. We have found in many situations a claim does not necessarily need to have any costs associated with it because self-care may be all that is needed at home. The registered nurse will visit with the injured worker and determine the proper course of action as to how the claim should be treated.
Medcor, a nurse triage service, states that roughly 43% of all claims are minor and can be treated with at home self-care without seeing a medical professional. When this happens, there is no formal claim filed for the restaurant on the workers compensation policy. It doesn’t cost the restaurant any additional premium to have claims processed this way, and in most situations claims costs are avoided.
If it turns out that further care from a medical professional is needed, then the nurse triage service can coordinate setting the appointment at a clinic on behalf of the injured worker. The positive outcome of this is that your business will see reduced claim costs because the injured worker did not go to the emergency room and will result in a doctor’s visit which typically costs a lot less than an ER visit.
In addition to helping control claims cost, businesses do not have to file the claim paperwork as the nurse triage service will be responsible, and now your team can focus on the business at hand.
A business’s workers compensation premium is determined by their payroll. The higher the payroll for a business, the higher the workers compensation premium. If you are wanting a more in-depth look on what determines a work comp premium, check out one of our other blog posts “How is my work comp premium determined?”
Accounting for payroll in the restaurant or bar industry can be especially difficult if employees are receiving tips or wages in cash and this is not accounted for on their paycheck.
Here’s the typical problem.
When an employee under-reports their wages to their employer, the employer has no idea of what they actually make. The same holds true for the workers compensation carrier. It may sound like a good idea and seems harmless to not tell the insurance carrier what the actual wages are. The benefit to the business is it lowers the premium and saves money, but this is far from the truth. This practice can result in severe problems at claim time which we’ll address shortly. A good business practice is for your company to make sure that employees are reporting all wages.
In the event an employee has a serious workers compensation claim, their weekly indemnity and potential settlement may be reduced drastically if this individual has not reported their payroll correctly to the employer. Weekly benefits are determined based upon the actual wages of the employee and if the employee has not reported their correct payroll, they won’t receive their full benefit when they are seriously injured. Things like this can be devastating to a family’s finances and can lead to potential bankruptcy.
Imagine a server actually making $50,000 a year but only reporting $22,000. If that server has a severe slip and fall and cannot work for a month or two, their weekly indemnity will be based on a $22,000 annual salary, not the actual $50,000. Now you have an employee who may be struggling financially to pay their bills, unable to work and this is when other problems may arise, especially if the business knew the server was under-reporting wages.
It may cost the business a little bit more premium on the workers compensation policy but can remove any potential litigation or claim that an injured worker might pursue looking for money.
WHO WE ARE
If you are reading this as an employer in the restaurant industry, Direct Work Comp wants to help you take the work out of getting work comp insurance. We understand the restaurant industry can be hectic, we want to help you alleviate some stress of the high risks that come with the restaurant & bar industry.
Direct Work Comp LLC is one of the fastest-growing agencies in the Midwest and is able to provide its clients with the latest and greatest of what the insurance industry has to offer and much, much more. Many businesses have the ability to obtain an instant workers compensation quote.
We are headquartered in Des Moines, IA and operate in several states in the Midwest. Our list of states is here. We provide a personal touch and a local feel to the solutions and services we provide our clients.
We pride ourselves on exceeding our client’s expectations in every interaction to make sure that our client’s know how much we value and appreciate their business.
Contact us today at 888.399.1190 or drop us an email at firstname.lastname@example.org for your comprehensive insurance quote!