Overview
Each year, the LRA SIF performs payroll compliance reporting to compare the amounts paid to your employees, amounts paid to third party contractors or service providers, and the premium paid during the calendar year. If the actual payroll is lower than the reported amount during the year, a credit may be due. If the actual payroll is higher than the reported amount during the year, an additional premium payment may be due.
Guidelines for a Successful Premium Compliance Report
Our goal is the make the reporting process as smooth as possible. The more accurate your payroll records, the better opportunity to find potential savings. In addition to self-reporting, the LRA SIF utilizes third party compliance support for increased efficiency. You will receive an email, call or letter in the first quarter of each year to provide the compliance reporting information for the previous calendar year.
How is my premium determined?
Your premium is based on payroll and/or remuneration. Remuneration is money or substitutes for money and includes, but is not limited to, gross wages, commissions, sick pay, holiday and vacation pay, value of lodging and bonuses. Remuneration does not include tips, payments to group insurance or pension plans by the employer or severance pay. During the compliance reporting, you will be asked to provide documentation to verify your payroll amounts or other remuneration. It will also help to identify those items not subject to workers' comp premium.
Who can be excluded from my workers' compensation coverage?
Louisiana law allows sole proprietors, partners and executive officers of a corporation who each own at least ten (10%) percent of the entity stock or interest to accept or decline workers' compensation coverage. This requires those qualified in this group to execute a document noting they either accept or decline workers comp coverage. Payroll limitations exist for those owners who wish to be included for coverage or are not eligible (less than 10 percent of ownership):
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Executive Officers
For policies effective on or after 5/1/21 Maximum $2,700 per week; $145,600 per year Minimum $900 per week; $49,200 per year Executive Officers For policies effective on or after 5/1/22 Maximum $2,800 per week; $156,000 per year Minimum $900 per week; $52,000 per year |
Sole Proprietors and Partners
For policies effective on or after 5/1/21 Min/Max $48,900 per year Sole Proprietors and Partners For policies effective on or after 5/1/22 Min/Max $51,500 per year |
Louisiana also provides an exemption for musicians and performers who are rendering their services pursuant to a performance contract. There is an exemption form that must be completed aligned with each contracted engagement.
How is contract labor handled during Payroll Compliance Reporting?
When you engage third party contractors or service providers for your business, you should request a current "Certificate of Insurance" (COI) from each and every individual or company that you have paid for services. It should indicate that they have "in force" or current workers' compensation coverage. If they can’t provide evidence of workers’ compensation coverage at the time of the payroll compliance report, the LRA SIF is required by statute to assess additional premium for the payments made to these contractors or service providers.
How can I save money?
It is important that you maintain accurate records of all wages (including overtime), salaries and require independent contractors or contract labor providers to provide current "Certificates of Insurance." The amount paid to your employees in excess of regular time pay can be deducted from premium due if the excess can be verified in your records. Retaining these "Certificates of Insurance" each year helps you avoid any premiums being assessed because it verifies these third party contractors provide their own workers' compensation.
