Manage Your Company’s Workers’ Compensation Like a Pro With Gusto
Updated November 15, 2022.
If you're an owner of a business that requires some of your employees to do physical labor, you need to be properly educated about workers' compensation. Unfortunately, accidents at the workplace happen more often than we'd like them to, so employers must be prepared in case they befall them.
Namely, workers' compensation is an essential part of payroll. Although business owners often think this refers solely to salaries, payroll also includes other aspects like benefits, bonuses, and workers' compensation. Retaining payroll compliance is a crucial aspect of managing a business, and you'll have a difficult time remaining compliant if you've overlooked workers' compensation. Thankfully, there are now many ways to go about properly managing payroll and workers' compensation, so your business will always be protected should something unfortunate happen at the workplace.
Now, let's dive deeper into the world of workers' compensation and how to manage it.
What Is Workers’ Compensation?
Workers’ compensation is a type of insurance that provides benefits to employees who are injured or become ill as a result of their job. These benefits can include medical expenses, income replacement, and even death benefits.
However, keep in mind that workers' compensation isn't the same as disability insurance and unemployment benefits. While the latter two offer coverage outside of the workspace, workers' compensation is a part of the business. It's also worth mentioning workers’ compensation is mandatory in most jurisdictions—just like they're legally obligated to run payroll, businesses are required to provide coverage for their employees.
Namely, there are two main types of workers’ compensation:
- Statutory: A state-sponsored program that provides benefits to employees who are injured or become ill as a result of their job. Benefits are typically paid by the employer, although some states allow employees to opt out of coverage.
- Private: Unlike the state-sponsored program, a private policy is purchased by the employer to provide benefits to employees who were injured or became ill while working. The benefits are then paid by the insurer of the business.
» Are you compensating your employees properly? Discover the difference between employee compensation vs. benefits.
Why Is Workers’ Compensation Important?
Workers' compensation is important not only for employees, but for employers too.
For starters, workers' compensation can help you avoid lawsuits—if one of your employees is injured at work and you don't have workers' compensation, the employee could sue you for damages. Even if you're not at fault, the legal penalties can be quite costly.
Additionally, workers' compensation can help you retain good employees. If you have competent employees, chances are they'll want to work for a company that offers workers' compensation. In other words, workers' compensation can help you attract and retain reliable staff.
Finally, workers' compensation can help you improve safety in the workplace. When employees know they're covered in case of an accident, they're more likely to take safety precautions. As a result, you can create a safe work environment for your staff.
» Are you managing workers' compensation the right way? Here are simple steps to properly track and manage workers' compensation.
How to Manage Workers’ Compensation With Gusto
Gusto offers all the essential payroll features an employer can expect, which is why it's one of the most popular solutions for payroll management. Let's see how you can manage workers' compensation with Gusto.
How to Apply for a Policy
To start, you'll first need to add workers' compensation to your account by logging into your account and clicking on the "Benefits" tab. From there, click on the "Workers' Compensation" tab and select the state you're in.
Once you've clicked on the "Workers' Compensation" tab, do the following:
- Enter your business information, including its name, address, and EIN.
- Click on the "Apply Now" button.
- Click on the "Check Eligibility" button.
- Select the policy and start the application process.
What Benefits Do Gusto and NEXT Insurance Offer?
The best way to integrate workers' compensation is to do it with Gusto and NEXT Insurance—a workers' compensation insurance provider offering both statutory and private coverage. Statutory coverage is available in all states, while private coverage is limited only to specific ones.
Of course, the amount of coverage by your policy will depend on the state your business is in, but you can expect coverage for the following if you're using NEXT:
- Medical expenses.
- Lost wages while the employee is out of work
- Retraining in case of an injury
- Death benefits.
» Need to integrate Gusto with QuickBooks? Here's how to get a seamless online integration.
Workers’ compensation is a vital part of any business. Not only can it help you avoid lawsuits, but it can also attract and retain good employees. Additionally, workers' compensation can help you improve safety in the workplace.
If you're looking to add workers' compensation to your account, Gusto is a great option. With Gusto, you can add workers' compensation to your account and get coverage from NEXT Insurance.
» Unsure about choosing Gusto? Read our Gusto review or take a look at some alternatives instead.