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Audits
Guidelines for a Successful Premium Audit:
It is the desire of the Louisiana Restaurant Association/SIF to make the year-end premium audit process flow as smoothly as possible. We would like to take this opportunity to assist you in understanding how your accurately maintained records will allow for the most efficient audit to be processed, which could result in savings.
Your premium level will determine the type of audit required. You will be contacted by either LRA/SIF via a Mail-In audit with instructions on completing your audit or a Premium Auditor will contact you for an appointment if you require a phone or physical audit. Please be certain to advise the auditor if the appointment date is not convenient for you. We do ask that your audit be completed as soon as possible. All members will be notified within the first quarter of the year.
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What records will be needed?
The auditor will examine the records that relate to your workers' compensation coverage. The requested items include, but are not limited to, the documents listed below:
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- Journals
- Ledgers
- Check stubs
- 941's
- 1099's
- State unemployment records
- Cash disbursements
- Certificates of Insurance
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At the time of your audit, having someone available who is knowledgeable with your records, the operations of your company and the classifications of your employees will help facilitate a successful audit and prevent audit discrepancies.
How is my premium determined?
The premium for workers' compensation is based on payroll and/or remuneration.
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Remuneration means money or substitutes for money and includes, but is not limited to:
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- Gross wages
- Commissions
- Incentive plans, sick pay
- Payment for piecework
- Profit-sharing plans
- Holiday, vacation pay
- Value of boarding, lodging
- Bonuses (effective May 1, 2006)
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Remuneration does not include:
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- Reimbursement for tips or other gratuities
- Payment to group insurance or pension plans by the employer
- Severance pay
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Who can be excluded from my workers' compensation coverage?
Owners and executive officers covered under your workers' compensation have the same status as other employees. Louisiana law allows sole proprietors, partners and executive officers of a corporation each owning not less than 10% of the stock to accept or reject workers' compensation coverage. Each such individual must sign for acceptance or rejection. This signature should be on file prior to the final audit.
There are payroll limitations for those owners who wish to remain included for coverage or are not eligible (less than 10% of ownership):
Executive Officers
Executive Officers
For policies effective before 5/1/07
Maximum $1,600 per week; $83,200 per year
Minimum $100 per week; $5,200 per year
For policies effective on or after 5/1/07
Maximum $1,700 per week; $88,400 per year
Minimum $100 per week; $5,200 per year
Sole Proprietors and Partners
For policies effective before 5/1/07
Min/Max $41,800 per year
For policies effective on or after 5/1/07
Min/Max $46,800 per year
How is contract labor handled during the audit?
Workers’ compensation laws provide that a contractor is responsible for the payment of compensation benefits to the employees of its uninsured subcontractors. Once you have contracted a plumber, carpenter, etc. to perform work (other than incidental deliveries to your premises), you (as the contractor) then become responsible when an uninsured subcontractor or employees is injured.
To protect yourself, be sure to secure a Certificate of Insurance from any person or company rendering a service. If evidence of Workers’ compensation insurance is not available at the time of the audit, additional premiums shall be charged.
How can I save money?
Keep accurate records of overtime hours and payroll. The amount paid to employees in excess of straight time pay can be deducted if the excess can be verified in your records.
Retain Certificates of Insurance each year. To protect yourself, be sure to secure a Certificate of Insurance for workers' compensation coverage each year from any contractor or subcontractor you may hire. If evidence of workers' compensation insurance is not available at the time of audit, additional premiums shall be charged.
We are committed to providing our members with excellent, responsive and courteous service. Please contact our Member Services Department with any questions or for further clarification at (504) 454-2277 or (800) 256-4572.
You have a choice with the LRA/SIF!
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