Most Commonly Reclassified Lawn Care and Landscape Workers Compensation Governing Codes

Author, Drew Garcia, Vice President, Landscape Group, Rancho Mesa Insurance Services, Inc.

The year 2025 will mark my 10th year working with landscape, lawn care and tree care professionals across the country. This long-term approach allows our team the time to learn and grow with the industry. Being able to understand landscape operations and accurately relay this information to the insurance carriers is a critical component to the overall insurance program we put together for our clients.

Insurance carriers almost always audit policies at the completion of the term to reconcile estimated payroll versus earned payroll, and return or collect any additional premium. For workers’ compensation purposes, in states that are under the National Council on Compensation Insurance (NCCI) rating bureau (in which there are currently 35), the two major class codes used by landscape professionals are 0042 Landscape Gardening and 9102 Lawn Care Services. Each code applies to specific job duties; they have different rates per $100 of payroll; and, when the employer can clearly allocate payroll, both codes can be used. Without clear payroll records, however, the insurance carrier can consider summing all payroll into the higher tier.

The 0042 Landscape Gardening classification is considered a construction code and should be used for the new installation of landscapes. However, 9102 Lawn Care Services is not a construction code and should be used for the maintaining and servicing of existing landscapes. The difference in rate, depending on the state(s) in which you operate, can nearly be double for 0042 versus 9102. It is critical to clearly understand when to use each class code to avoid any misclassification that could disrupt cash flow during the policy or surprise you at audit with an additional owed premium.

The nuance of class codes for workers’ compensation does not stop here. Landscape professionals within NCCI states have nearly five or six other codes to consider for their operations, all with specific duties and varying rate. In addition to workers’ compensation codes, general liability policies use a similar system to differentiate services in order to collect adequate premium.

So, in order to avoid reclassification of payroll at the end of a workers’ compensation policy term, keep accurate records and talk to your insurance advisor.

For a more detailed discussion about your operations and the corresponding class code assignments, please reach out to me at (619) 937-0200 or drewgarcia@ranchomesa.com.

Employer’s Guide to Handling Cumulative Trauma Claims

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

A growing thorn in employers’ sides has been the rise of worker’s compensation cumulative trauma (CT) claims. Cumulative trauma refers to the ongoing psychological and physical injuries that accumulate over time, often resulting from repetitive stress or exposure to adverse conditions. Employees missing time can lead to larger workers’ compensation claims, lower moral, and less efficiency. It can be easy as an employer to take a defensive stance and fight each one of these, but there are a few factors that must be taken into consideration prior to deciding if you should settle or challenge these claims.

Not every CT claim should to be fought. As hard as it is to hear, you can win the battle but lose the war. Sometimes the cost of gathering information, medical reviews, time spent away from operations and litigation can add up to more than it would have cost to settle these claims. This is extremely tough to achieve in construction as the burden is on the employer to prove that there is no way that their stated injuries could have happened while working for you.

Employers can proactively fight CT claims by staying ahead of the exposure as much as possible. This means making sure your workers have the safest, most ergonomic-friendly environment possible. Stress and repetitive motion are two of the largest causes of CT claims. Trying to keep your employees from doing the same repetitive task over and over is extremely important in keeping both moral high and frequency of claims lower. However, this can be difficult for most construction companies with the need to perform the same motion over and over, but it is necessary to have your employees switch up tasks if at all possible.

This does not mean that every cumulative trauma claim should be settled either. We are seeing younger and younger employees filing these once they have been let go or have chosen to leave. These post termination claims typically come attached with an applicant attorney and can include multiple body parts being named that appear initially as fraudulent statements. If it is determined that there truly was no record of injury and they are able to perform all normal duties, fighting the claim may make sense.

Each claim is unique and needs to be handled as such. Relying on your insurance broker and carrier claim consultant for guidance is critical in staying focused on the facts, not the frustration and emotions that often accompany these types of claims. While settling a claim that could be fraudulent can be frustrating and does have an impact on your experience modification rate, it can often be the best path towards minimizing costs and maintaining lower loss ratios that lead directly to lower renewal premiums, which is the ultimate goal.

If you have any questions about how to handle cumulative trauma claims, reach out to me at ccraig@ranchomesa.com or (619)438-6900.

Three Industry Benchmarks all Landscape Companies Should Track

Author, Greg Garcia, Account Executive, Rancho Mesa Insurance Services, Inc.

There are three major benchmarks that all landscape companies should consider when looking at how well they manage risk.  The three benchmarks are your:

• Average Claim Cost

• Claim Indemnity Rate

• Claim Frequency Rate

Knowing the importance of this, we designed a key performance indicator (KPI) dashboard that highlights these industry benchmarks, as well as compares them against other landscape companies in their geographic area.

We have pulled data from all landscape companies using the 0042 class code and have come up with some industry averages.  For the sake of this example, we will use California landscape contractors only. 

In California, the average claim cost for landscape contractors is $50,300 per 1 million dollars of landscape payroll.  In other words, on average for every 1 million dollars a landscape company has in the 0042 class code they should incur about $50,300 in claim cost. That number would rise to $100,600 in claim cost if a landscape company had 2 million dollars in 0042 class code. 

The next major category to consider would be indemnity rate.  Indemnity rate, or claims that result in lost time and temporary disability, the industry average is 0.7 claims per 1 million dollars of 0042 payrolls. 

Finally, the last category we consider is frequency rate.  In California for every 1 million dollars allocated to the 0042 class code on average that company will have 1.5 claims.

Knowing the data will not only give your team a good indication of how safe your company is, but these categories also play a significant role in determining work comp premiums.  There are several underwriting metrics a worker compensation underwriter takes into consideration when looking at a prospective business.  The Experience MOD, loss history, and of course safety protocols and procedures to name a few. 

The other major metric that underwriters are looking at are these three benchmarks: , average claim cost, indemnity rate, and frequency rate.  Simply put, the better a landscape company scores in these critical metrics, the better chance that an underwriter will add schedule credits to lower the worker’s compensation premium.

Now is a great time to see how well your landscape company stacks up against your peers, and consider any internal options to improve your metrics in any of these three major categories.

Using Rancho Mesa’s KPI Dashboard to Improve Your Workers’ Compensation Program

Author, Drew Garcia, Vice President, Landscape Group, Rancho Mesa Insurance Services, Inc.

Landscape business leaders can now provide their management team with resources to better support their workers’ compensation program. Rancho Mesa offers its landscape, lawn care and tree care customers an industry specific Workers’ Compensation Key Performance Indicator (KPI) that can be used to help benchmark a company’s experience modification rate (i.e., Ex-Mod, Experience Mod), and the underlying performance trends that can help stakeholders stay informed.

The KPI is an easy to read one-page document made up of dials and dashboards so that the business leaders can easily absorb the most critical pieces of information.

Three Use cases

1. Landscape businesses can use the KPI to help set annual leading indicator goals. These goals, like the completion of a certain number of toolbox talks, safety observations, and online trainings can all be tracked in Rancho Mesa’s SafetyOne™ Platform. By using the lagging information provided in the KPI, any business can then set goals to address corrections that the KPI discloses.

2. The Ex-Mod can be used as a pre-qualification tool for bidding new work or maintaining certain contracts. With the KPI dashboard, landscape businesses will always know their current, 10 previous, and estimated future Ex-Mods.

3. Underlying information such as frequency and severity rates can easily be understood through the StatTrack™ portion of the KPI dashboard. These rates are viewed as trends and allows the business to make timely corrections.

Empower your leadership team to better understand your workers’ compensation program by providing them with the tools they need to effectively make a difference.

Learn more about the KPI Dashboard on Rancho Mesa’s Mod Doctor webpage.

Understanding the Importance of Your Workers’ Compensation Unit Stat Filing Date

Author, Greg Garcia, Account Executive, Rancho Mesa Insurance Services, Inc.

Imagine you are a landscaping company owner and your workers’ compensation policy just renewed January 1st. You are probably thinking, now what? Well, the next date that should be on your radar is June 30th, your unit stat date. Each unit stat date varies and with the actual filing taking place approximately 180 days from when the workers’ compensation policy was placed. The unit stat date is when all workers’ compensation claim activity is frozen, along with audited payroll information, and sent to the rating bureau so the experience modification (XMOD) can be calculated.  

As a reminder, your XMOD is determined by comparing your loss experience and historical payroll to others with similar class codes. The XMOD is derived from three years of audited payroll and losses suffered over those years.

If a particular claim is closed after your unit stat date, that claim will impact your next XMOD at the total incurred value before the unit stat date. Therefore, if you have a claim that can either be closed or reserves reduced, it is critical that this is done ahead of the unit stat date. Staying up to date with your claims adjuster and insurance professional ahead of the filing can quite literally save you points on your XMOD, which in turn can help to reduce your worker’s compensation annual premium.

Using one of the metrics on our proprietary KPI Dashboard, our clients are able to track the number of days until their unit stat date. Combining this KPI tool with our dedicated workers’ compensation claim advocate services at prescheduled claims reviews throughout the policy year helps to close the claims or mitigate claim costs in advance of the filing. This strategy can dramatically lower overall insurance costs.

If you have any questions about the unit stat or would like me to put together a custom KPI dashboard for your team, you can contact me at ggarcia@ranchomesa.com.

WCIRB 2024 Construction Dual Wage Threshold Increases Approved

California Insurance Commissioner Ricardo Lara has approved an increase in hourly wage thresholds for all 16 construction dual-wage classifications.

The increases range from $1 to $4 depending on the classification and will go into effect for policyholders on their workers’ compensation policy renewal date on or after September 1, 2024. The chart below outlines the proposed increases for each classification.

Dual Wage Classifications	Existing Threshold	Proposed Increase	Proposed Threshold
5027/5028 Masonry	$32	$3	$35
5190/5140 Electrical Wiring	$34	$2	$36
5183/5187 Plumbing	$31	$1	$32
5185/5186 Automatic Sprinkler	$32	$1	$33
5201/5205 Concrete Work	$32	$1	$33
5403/5432 Carpentry	$39	$2	$41
5446/5447 Wallboard Installation	$38	$3	$41
5467/5470 Glaziers	$36	$3	$39
5474/5482 Painting Waterproofing	$31	$1	$32
5484/5485 Plastering or Stucco	$36	$2	$38
5538/5542 Sheet Metal Work	$29	$4	$33
5552/5553 Roofing	$29	$2	$31
5632/5633 Steel Framing	$39	$2	$41
6218/6220 Grading/Land Leveling	$38	$2	$40
6307/6308 Sewer Construction	$38	$2	$40
6315/6316 Water/Gas Mains	$38	$2	$40

In light of the ongoing labor shortage within the construction industry, employers have been making a concerted effort to retain their workforce. This includes providing more comprehensive benefits packages, including higher wages, and merit-based bonuses when appropriate. As a result, these new wage classification increases may prompt employers to consider extending further salary increases to their employees, with the aim of reducing workers' compensation premiums.

To better understand these changes and plan for the impact this will have on your company, please call us at 619-937-0164 and ask to speak to a member of our construction group.

Return to Work Programs: Best Practices for Handling Workers’ Comp Claims

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

How do you handle the situation when a great employee is injured but not quite ready to return to full duty? We do all that we can to prevent injuries and make sure once they do happen our employees are taken care of quickly and properly. The one true variable we have in our control, after a claim has been filed, is how to accommodate employees that are injured but not able to return to normal duties until deemed fully recovered.

Your experience modification rate (X-MOD) is a very important component in your premiums and potentially securing bids in states like California. Every company has a primary threshold that is unique to the company. This is a dollar amount per claim that, once the medical, permanent disability, and temporary disability surpasses this threshold, has no further impact to your X-MOD. Carriers have medical review teams set in place to ensure that the medical portion of each claim is as low as possible, permanent disability is dictated by the treating doctor, so the only portion of each claim we have control over is how the temporary disability will be handled. Sometimes, even that is out of our control if an injured employee is not able to work in any capacity.

Ideally, your workers’ compensation doctor will quickly give you work restrictions and you will be able to determine if you have any available work within those restrictions. The bigger question is what to do with these employees if they are not fit for regular duty? Is it best to let the carrier handle the temporary disability portion of the claim, have the employee come back and work in your office doing odd jobs, or utilize companies like ReEmployAbility or carrier programs where they can work at any number of nonprofit organizations? Temporary disability mismanagement can add up very quickly and lead to a small claim turning into a claim that heavily impacts your X-MOD.

Making sure your employee feels valued and that they have a job to come back to is a great way to keep claims cost down and employee morale high. When employees sit at home waiting to recover, they may feel helpless and uncertain about their future, are exposed to countless commercials about injured workers and lawyers that claim they can make them rich. Keeping them at work, in some capacity, where progress can be seen and communication continues is beneficial for both the employee and the employer.

The intricacies of how to handle claims is something you hope to never need to be good at as an employer, which is why it is so important to have a broker and claims advocate on your side to help navigate the process with you.

This is a complex topic and if you would like to discuss further or talk about any other insurance needs, I can be reached at (619)438-6900 or you can email me at ccraig@ranchomesa.com.

Focus on Frequency with a Small Work Comp Deductible

Author, Drew Garcia, Vice President of the Landscape Group, Rancho Mesa Insurance Services, Inc.

Economies of scale create leverage for landscape businesses as they grow. The Bureau of Labor Statistics (BLS) 2022 table of incident rates notes that the landscape industry has an incident rate of 3.4 per 100 full time employees. Landscape is classified by BLS under Administrative and Support and Waste Management and Remediation Services; this sub class has an incident rate of 1.9. The average for all other industries is 3.0.

With frequency typically being high for the landscape industry, it’s important to continue to focus on ways to minimize injury, prevent severity and focus on return to work opportunities when an injury does arise.

While commercial auto, general liability, and umbrella have been stuck in a hard market, workers’ compensation has relatively been in a soft market. Combined ratios for private insurance carriers on workers’ compensation was published at 87% in 2021 and 84% in 2022, according to the National Council on Compensation Insurance (NCCI) State of the Line Report. This impact on carrier profitability has led to decreased pressure on rates for landscape employers across the country.

Like all things cyclical, it is expected that the workers’ compensation market will reverse and begin to harden.

As the market hardens, landscape employers operating in the middle market (i.e., businesses with an annual workers’ compensation premium between $300,000 and $1,500,00) should consider a small workers’ compensation deductible to tackle the high likelihood of frequency.

Small deductibles vary by carrier from $1,000 to $25,000. Collateral might be required and the ability to apply an aggregate to the policy will also vary by carrier.

A small deductible allows the landscape company an opportunity to take the predicable layer of injury cost while still transferring severity to the insurance carrier. 

As your company grows and/or market conditions change, consider a small workers’ compensation deductible to maximize your insurance program.

To discuss implementing this strategy for your business, contact me at (619) 937-0200 or  drewgarcia@ranchomesa.com.

WCIRB Files for Workers’ Comp Rate Increase

Author, Sam Clayton, Vice President, Construction Group, Rancho Mesa Insurance Services, Inc.

Earlier this month, the Workers’ Compensation Insurance Rating Bureau (WCIRB) recommended a nominal .9% increase in the advisory pure premium rates. The reason given, increased loss development for medical costs and higher claims adjustment expenses. This recommendation is now sent to the California’s Insurance Commissioner Ricardo Lara for approval. If approved, the increase in rates then take effect September 1, 2024.

Recognizing that a .9% increase is not very significant and in 2023 the WCIRB requested a similar increase which ultimately was denied by Commissioner Lara, the message remains clear that  workers’ compensation rates have probably bottomed out.

This does not mean every business will see an increase. There will still be reductions in some class codes pure premium rates and pricing will be more tied to Experience Modification Rate (EMR) decreases and an individual company’s claims experience. For distressed accounts, companies whose EMR is increasing and have had poor claim experience, will likely see an increase in their rates.

In order to stay ahead of this, we recommend companies review their key performance indicators (KPIs) that measure and compare a company’s frequency and severity of claims to their peers within the same governing class code. These metrics allow a company to identify trends, design programs that will address specific training needs, and project claims costs that will ultimately impact their EMR.

In addition, we recommend working closely with your claim advocate to assist in monitoring open workers’ compensation claims, and identify any open claims under your company’s primary threshold that could be closed prior to your unit stat filing that can impact your EMR.

If you would like to learn more about the pure premium rate’s impact by class code or evaluate your specific KPIs, I can be reached at (619) 937-0167 or via email at sclayton@ranchomesa.com.

Dual Wage Thresholds Set to Increase Again

Author, Matt Gorham, Account executive, Rancho Mesa Insurance Services, Inc.

In an effort to keep up with wage inflation, California’s Workers’ Compensation Insurance Rating Bureau (WCIRB) has recommended increases to all 16 construction dual wage thresholds, which, if approved, would impact policies beginning on September 1, 2024 and could drive up insurance premiums for those unaware.

Dual wage thresholds help carriers evaluate risk of employee injury by correlating average hourly wage with experience on the job. The general notion is that employees with more experience command higher wages and are less likely to get injured at work, while employees with less experience are paid a lower wage, are less familiar with safety and jobsite protocols, and therefore more likely to be injured at work. This difference in risk leads to a difference in cost for insurance premiums, with higher paid employees costing their employers comparatively less in premium.

Using the base rate of $31 or more per hour from one carrier, consider the example of a plumber: a plumber earning $30 per hour will cost their employer $9.31 per $100 of payroll, while a plumber earning $31 per hour will cost their employer $4.35 per $100 of payroll. That is roughly a 47% higher cost in premium per $100 for an employee earning 3% less per hour.

Since the last time the WCIRB suggested an increase to the dual wage thresholds in December 2021, inflation and labor shortages have continued to drive up wages in the construction industry. According to the St. Louis Fed, average hourly earnings in construction have increased from $33.60 to $37.53 – more than 11% in that time. While wages are going up, the experience of employees is not keeping pace, leaving insurance carriers exposed. To address this disparity, the proposed threshold increases from the WCIRB range from $1 for plumbing, automatic sprinkler, concrete work, and painting/waterproofing to $4 for sheet metal/HVAC work.

To get ahead of this proposed change, business owners should consider whether it is more beneficial to award employees with raises or to pay more in insurance premiums. With increased overhead costs likely coming either way and quality employees already in short supply, not only could strategic raises offer relative savings, they could strengthen the loyalty from your team.

While this proposed change still needs final approval by the insurance commissioner, it is expected to have a major impact on wages and potentially premiums within the construction industry.

To evaluate the impact of the proposed dual wage threshold increase on your business, contact me at (619) 486-6554 or mgorham@ranchomesa.com.

California Updates Required Employment Pamphlets

Author, Megan Lockhart, Client Communications Coordinator, Rancho Mesa Insurance Services, Inc.

Recently, the State of California has made several important updates to labor pamphlets that must be provided to employees. 

Employers must provide the updated “Time of Hire” pamphlet to new hires. Created by the California Department of Industrial Relations Division of Workers Compensation, the document defines workers’ compensation and explains how employees can file a claim and gain access to medical care.

Additionally, the Employment Development Department (EDD) updated its “For Your Benefit” pamphlet. Employers are required to provide this both at the employee’s time of hire and their dismissal.

The document outlines benefits provided to employees by the state in the event of their termination or when they take certain leaves of absence. It also informs employees on how to obtain unemployment insurance, the tax requirements for unemployment benefits, which employees are not eligible for unemployment benefits, and who is eligible for state disability insurance.

These pamphlet updates accompany the changes made to California Labor Code section 2810.5 in January 2024, which requires that employers provide employees with a written notice about their wages, such as pay rates, overtime rates, and designated paydays. This notice must also be given to employees when they are hired. If there is a change of information in the notice, they must also provide an updated version within seven days of a change or in the employee’s pay stub by the next pay period.   

With these recent changes now effective, its important for employers to evaluate the materials they provide their employees to ensure compliance. For more information about required employment information or other human resources questions, access Rancho Mesa’s RM365 HRAdvantage™ portal.

How to Strategically Grow Your Construction Company

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

One of the biggest ongoing challenges in the construction industry today is hiring and retaining quality employees that can help build on a company’s foundation. Growing a construction company in a sustainable way through internal promotions while also integrating new hires can separate one company from its competitors.

Employees are a company’s most valuable asset and making sure the right people are in the right positions is vital to profitable growth. There are high performing laborers at every construction firm but just because they are successful in one position does not necessarily mean that they will transition successfully into becoming a great estimator or superintendent. So, it is critical to promote the right people into the right positions for the success of the company.

Promoting from within is typically more cost effective than an outside hire and leads to a boost in company morale. The promoted employee already knows your company culture and safety expectations, and they can pass their knowledge onto new hires. So, finding the right internal people to elevate into leadership positions is the logical path, when available.  

Having assessment tests and specific steps for how to be promoted in your employee handbook is a great way to provide both new and seasoned employees a clear path for career growth.

Identify employees that can handle stressful situations and are poised problem solvers. Do not wait for a need to arise; start including these valued employees in meetings to make sure they are prepared to take on a new role when the company is ready to grow or there is an opening due to an employee retirement. This can alleviate some of a leader’s workload allowing them to deal with big picture issuing facing the firm.

Take advantage of both safety and professional development courses to grow your existing employees. Rancho Mesa’s SafetyOne™ platform provides online safety courses for employees, while the RM365 HRAdvantage™ Portal offers online courses to help employees hone the soft skills they will need to grow their careers.

While this topic remains one of the most challenging aspects of running a construction company, do not let this problem be compounded by being unprepared. Stay diligent in the hiring process and pay attention to the employees you do have with the right traits. This can lead to lower insurance costs as more efficient employees in management positions can directly assist with building a safer culture with more preparedness when claims arise.

If you have any questions pertaining to this article or any other insurance questions, do not hesitate to reach out. You can contact me at ccraig@ranchomesa.com or call at (619) 438-6900.

Cracking the Code: Deciphering the Primary Threshold’s Impact

Author, Greg Garcia, Account Executive, Rancho Mesa Insurance Services, Inc.

Every business owner understands the correlation between their Experience MOD (XMOD) and what they will pay in workers’ compensation premiums.  When the XMOD increases, there is a good chance that the workers’ compensation rates or premiums will rise as well.  This is why it is so crucial to really hone in on company safety procedures to limit work-related injuries as much as possible.  The reality is that even the safest company that does everything the right way is going to run into a workers’ compensation claim from time to time.

So, when the inevitable workers’ compensation claim happens, what are you supposed to do?  What impact will this have on the XMOD?  The first component that business owners need to understand is that there is a cap to how much any single workers’ compensation claim can impact the XMOD.  That cap is called the primary threshold.  The primary threshold varies from company to company and is based off of the company’s payroll.  The more payroll a company has the higher the primary threshold.

For this example, a company has a primary threshold of $15,000 where the maximum number of points that any one claim can impact the XMOD once reaching the threshold is 10 points.  This means that a claim that costs $15,000 and a claim that cost $150,000 will have the same impact (10 points against the XMOD).  However, this does not mean that claims that exceed the primary threshold can be disregarded, because the higher claim cost you have will impact your current and 5-year loss ratio (incurred claim cost/premium paid).  Additionally, if a claim that was reserved higher than the primary threshold and can be closed or decreased lower than the primary threshold, XMOD points can be shaved off of that claim.

Knowing the importance of the primary threshold, we designed our proprietary the KPI dashboard that allows our clients to see their primary threshold number and corresponding maximum impact to the XMOD any one primary threshold claim would have. 

If you have any questions about your XMOD or would like us to create a KPI for your company, please feel free to reach out to me at (619) 438-6905 or ggarcia@ranchomesa.com.

The Billion-Dollar Cost of Working at Height: The Critical Questions to Ask Before Climbing a Ladder

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

Every year, OSHA publishes a “top 10 most frequently cited standards” list. Without question, ladders and fall protection consistently make the list. A Liberty Mutual 2023 workplace survey found that $6.26 billion was spent on falls as a result of working at height. Working at height is inherently dangerous but becomes more so when the incorrect ladders are used or improper setup for a job. Sending your employees to a jobsite without conducting a proper analysis to guarantee you have the proper equipment is setting yourself up to have preventable claims.

Before choosing a ladder at for a job, ask yourself:

• Will the ladders on site reach your desired height safely?

• Do the pads need to be replaced on the feet of the ladder?

• Do I have a faulty ladder?

• Should I be using fiberglass or metal?

• Is the ground level or should I have a ladder with adjustable outriggers?

• Do I need a guardrail system on my ladder?

• Am I able to get the proper angel needed for an extension ladder?

• Do my employees have the proper footwear?

All potential claims from ladders are theoretically preventable if we take the time to prepare properly. Your employees can be working at height for long periods of time, sometimes on very hot or cold days and need to be alert both while at height and especially when getting down. A vast majority of claims we see from ladder falls come from slipping or missing the last rung on a ladder. Looking further into these accident investigations, we see that many employees are not getting enough breaks so they can stay mentally and physically alert.

Most contractors are equipped with step stools, step ladders and extension ladders but these might not be all that is needed to get the job done properly. Each of these serve a purpose and are the most common on job sites for a reason which is why most work can be completed using just these three types of ladders. However, just because we are able to reach our desired height does not mean that it is the most efficient way to get there. Having more intricate ladders available for certain projects has become increasingly more valuable.

According to the Bureau of Labor Statistics, fatal injuries from movable ladders has decreased by nearly 17% from 2019 to 2020 while non-fatal ladder injuries remained consistent (this is the newest data available published in April of 2022).  Things appear to be trending in the right direction with more information and safer ladders available. That said, ladder safety needs to be at the forefront of your safety program as those contractors working at height are always one slip away from a claim that can drastically change the live of an employee along with your insurance program.

If you have any questions on how to improve your ladder safety program or any other insurance questions, do not hesitate to reach out. You can contact me at ccraig@ranchomesa.com or call at (619) 438-6900.

WCIRB Proposes 2024 Construction Dual Wage Threshold Increase

The Workers' Compensation Insurance Rating Bureau (WCIRB) has proposed an increase in hourly wage thresholds for all 16 construction dual-wage classifications.

The increases range from $1 to $4 depending on the classification and if approved will go into effect for policyholders renewing September 1, 2024 and thereafter. The chart below outlines the proposed increases for each classification.

Dual Wage Classifications	Existing Threshold	Proposed Increase	Proposed Threshold
5027/5028 Masonry	$32	$3	$35
5190/5140 Electrical Wiring	$34	$2	$36
5183/5187 Plumbing	$31	$1	$32
5185/5186 Automatic Sprinkler	$32	$1	$33
5201/5205 Concrete Work	$32	$1	$33
5403/5432 Carpentry	$39	$2	$41
5446/5447 Wallboard Installation	$38	$3	$41
5467/5470 Glaziers	$36	$3	$39
5474/5482 Painting Waterproofing	$31	$1	$32
5484/5485 Plastering or Stucco	$36	$2	$38
5538/5542 Sheet Metal Work	$29	$4	$33
5552/5553 Roofing	$29	$2	$31
5632/5633 Steel Framing	$39	$2	$41
6218/6220 Grading/Land Leveling	$38	$2	$40
6307/6308 Sewer Construction	$38	$2	$40
6315/6316 Water/Gas Mains	$38	$2	$40

In light of the ongoing labor shortage within the construction industry, employers have been making a concerted effort to retain their workforce. This includes providing more comprehensive benefits packages, including higher wages, and offering merit-based bonuses when appropriate. As a result, these proposed wage classification increases may prompt employers to consider extending further salary increases to their employees, with the aim of reducing workers' compensation premiums.

Rancho Mesa predicts that this information will become a major factor in payroll decisions based on overhead cost management and recommend this as a topic for discussion early, so that our clients and prospects can prepare.

Implementing Technology and Other Safety Tactics to Protect Your Fleet

Author, Greg Garcia, Account Executive, Rancho Mesa Insurance Services, Inc.

One of the most important practices for any landscape professional is fleet safety. Whether you have 10 trucks or 100, the exposure and risk remain the same. Explore a prior podcast episode, Episode #251, in which I delve into compelling statistics that shed light on the increasing frequency and severity of auto accidents each year.

Here are a few ways landscape professionals can improve their fleet safety:

1. GPS/Telematics Systems

A written fleet safety program is a must have for every organization, but how can you take that a step further? Some landscape professionals are turning to technology and installing GPS tracking systems in all of their trucks. These systems have the capabilities of tracking speeding, hard breaking, sharp turning, proper seat belt usage and other metrics. Not to mention, if a truck were ever stolen, they have the capabilities to track down and locate the stolen vehicle. 

I was at the National Association of Landscape Professionals’ (NALP) ELEVATE conference a few weeks back in Dallas and spoke with a landscaper who uses GPS on their trucks. I asked how they use the data that is collected. Their response was that each month they sit down and look at the data. They identify any glaring issues and work to get them resolved. For example, if a certain driver has been tracked speeding multiple times, they will sit that driver down and explain the importance of not speeding. They may even have them do a specific driver training course to help that individual become a better driver. Having GPS is a great start to improving fleet safety, but actually using the data collected and being proactive with that data is what the elite landscape company do.

2. Regular routine maintenance checks on vehicles

GPS tracks a vehicle while it’s driven, but what can be done before the vehicle even hits the road to help prevent accidents?  Routinely checking vehicles and performing maintenance on them can really have a impact on fleet safety. For example, regularly checking tire pressure, making sure oil changes are up to date, inspecting the brakes and monitoring tire wear are a few things that every landscape company should do to keep their vehicles running in tip top condition. 

3. Company Roll Out Procedure

Implementing a mandatory company roll-out check can have a significant impact. I have actually seen a few of these performed in person and it’s impressive. As the trucks leave the yard to head out for the day’s work, the driver signals both blinkers, flashes the headlights, cleans the windshield and mirrors, and performs a small brake check, all the while, an inspector is outside making sure all signals are working before the truck heads out. 

Finally, if a trailer is being used, check to make sure the trailer is properly hitched and the equipment in the trailer is tied down or stored securely. Taking time and performing these checks will certainly help prevent auto accidents in the future.

If you would like more information on putting together or updating your Fleet Safety program, reach out to me at ggarcia@ranchomesa.com or (619) 438-6905.

Pure Premium Increase for Landscape (0042) in Consecutive Years

Author, Greg Garcia, Account Executive, Rancho Mesa Insurance Services, Inc.

In September 2022, the Workers’ Compensation Insurance Rating Bureau (WCIRB) recommended a 9% increase in the pure premium rate for landscape class code 0042. Effective September of 2023, a 4% increase was recently approved, totaling 13% over the two-year span.

Pure Premium Rates arise from losses sustained and payroll submitted to the WCIRB from all workers’ compensation insurance companies. Per the California Department of Insurance (CDI), “Pure Premium Rates” are defined as “the cost of workers' compensation benefits and the expense to provide those benefits.” The WCIRB evaluates each individual class code and determines what the recommended rates will be for the upcoming year. This recommendation is made to the CDI who ultimately needs to reject or approve the recommendation. Once the pure premium rates are approved, each workers’ compensation insurance carrier will apply their individual least common multiple (LCM) which is an adjustment to the pure premium rate that takes into consideration business expenses and profit for the carrier, thus creating their individual base rates for each class code.

What does this all mean? The claim activity and claim cost as a whole have been increasing over the last two years for landscapes companies in California. This may signal the beginning of a hardening workers’ compensation market resulting in higher premium cost. 

What can be done to help combat these potential increases in premium? An increased attention to safety practices to reduce claims, a robust return to work program to mitigate cost of existing claims, proactive claim management, and consistent, documented safety training are a few of the ways that will help a landscape business remain best in class. 

Take control of your future costs and look to your existing risk management partners to help you accomplish your goals. For Rancho Mesa landscape clients, we do this through our customized and proprietary programs and tools, including:

• RM365 Advantage SafetyStar™ Certification Program

• Mobility & Stretch™ / A.B.L.E. Lift Protocol Program

• Key Performance Indicator (KPI) for workers’ compensation

• In-house workers’ compensation claims advocacy

• 52-week landscape-specific safety toolbox talk topics

• Monthly workshops and webinars

• New SafetyOne™ mobile app

These pure premium changes will take place on workers’ compensation insurance renewals after September of this year. Don’t be caught by surprise or unprepared.  We are here to help you proactively navigate through this. If you have any questions, want to learn more about our programs and tools, please feel free to reach out to me at ggarcia@ranchomesa.com or 619-438-6905.

Implementing Best Practices when Hiring in the Construction Industry

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

With unemployment rates settling near 4%, it is becoming increasingly difficult to find the right employees to help grow your construction company. With most able-bodied workers having secure employment, this leads to having either apprentice-type employees that come with unique challenges or pulling from an aging workforce that can bring cumulative injuries and risks. Navigating these issues can be complex and there is not a perfect solution, but employer’s hiring practices need to change in order to keep up with the current state of the industry.

When hiring new employees, consider:

• Pre-hire drug testing

• Pre-hire physicals

• Targeted job postings with accurate description of daily work

• Multiple levels of interviews

• Simulating work at your office that potential new hires would be performing in the field

The US saw a unique shift in the workplace as a result of COVID-19 where employees felt their value skyrocket as fewer people were willing to work in-person. Employers were forced to increase wages to get bodies on jobsites. In prior years, it may have been enough to just rely on word of mouth and referrals to get new hires. Too often now, we are seeing new hires suffer “ghost injuries” that are quickly followed with letters of representation.  These and similar types of cumulative trauma claims can have long term impacts on your experience rating (EMR). While these situations are difficult to prevent, using best practices and conducting thorough interviews with your prospective employees will allow you to make educated decisions which typically lead to better hires.

Taking advantage of the best practices listed above can help insulate your company from poor hiring decisions. Obviously, we would love for new hires to turn into long term employees, as onboarding and proper training can be a costly expense in both other employee’s time and payroll. In a recent survey conducted by Traveler’s Insurance, it was shown that 34% of workplace injuries occurred during the worker’s first year on the job. This can be from a combination of inexperience, overexertion, and/or lack of safety knowledge.

Consider these hiring and onboarding processes to assist in mitigating the glaring number of claims that are emanating from newer employees or employees that have limited experience on jobsites. The financial impact they can have on your company will impact your balance sheet for years and can be potentially avoided with implementing some of our recommended techniques

To learn more about improving your hiring practices or how Rancho Mesa can help to improve your process, reach out at (619) 438-6900 or ccraig@ranchomesa.com.

Guidance for Developing an Effective Injury and Illness Prevention Program

Author, Sam Brown, Account Executive, Rancho Mesa Insurance Services, Inc.

As some company leaders may recall, since 1991, all California employers are required to maintain a written Injury and Illness Prevention Program (IIPP). An IIPP is an understandable and accessible safety program tailored to a business’ operations. An effective IIPP will help an employer establish and maintain a safe workplace while setting expectations and protocols for all employees.

The information below outlines the necessary elements of a written and effective IIPP, while recommending a resource to use when creating or updating the plan.

Cal/OSHA requires all Injury and Illness Prevention Programs to contain nine critical components:

1. A person (or persons) with authority and responsibility for implementing the program is identified.

2. A system for ensuring employees comply with safe and health work practices.

3. A system for communicating with employees in a form readily understandable by all affected.

4. Procedures for identifying and evaluating work place hazards.

5. Procedures to investigate occupational injury or illness.

6. Procedures for correcting unsafe or unhealthy conditions, work practices and procedures.

7. Provide employee training and instruction.

8. Procedures to allow employee access to the Program.

9. Recordkeeping and documentation.

California employers looking for guidance on the Cal/OSHA required Injury & Illness Prevention Program can often feel overwhelmed when addressing all required elements, while also abiding by the best practices of updating the plan, annually. Fortunately, California’s State Compensation Insurance Fund offers a free IIPP builder to all employers.

The State Fund’s IIPP Builder will help an employer create an IIPP from scratch, but can also help improve an existing program to make it more effective and compliant. An employer is first asked to answer a series of questions about safety practices. The answers will help build a safety program and tailor it to the business. The IIPP builder will also guide an employer through the required elements of the written IIPP.

Once finished, an employer can save the IIPP to their computer and upload it into their SafetyOne™ mobile app. They can also print and keep a hard copy at all locations. Lastly, to make it a truly effective program, the employers should share details of the IIPP with their employees.

Rancho Mesa wants clients to feel comfortable and confident when creating, updating, and sharing details of their Injury and Illness Prevention Program. To learn more about an effective IIPP and the State Fund’s IIPP BuilderSM, please contact me at sbrown@ranchomesa.com or (619) 937-0175.

Properly Utilizing Tailgate Meetings

Author, Casey Craig, Account Executive, Rancho Mesa Insurance Services, Inc.

For many foremen and superintendents, weekly tailgate meetings can feel like a task that just needs to be checked off the list. However, while the purpose of these meetings is critical for the health and well-being of fellow field employees, the time required and repetitive nature of them can create challenges. To maximize the benefits of these meetings, construction firms must be proactive and thoughtful as they develop an inventory of topics.

Identifying Tailgate Meeting Topics        

Take ample time with your sales team to understand the scope of your backlog to see where hazards may appear within these projects. Plan training topics with an eye on the weather, paying close attention to historically warm or cold months. Consider connecting with your insurance broker as well on recent injury trends that you can address with the crew.

This will be pertinent as your company approaches their renewal window with underwriters looking at claims history. They commonly ask, “what has the insured done to make sure these claims don’t happen again?” Learning from your past is key to being proactive. Knowing you will have certain exposures coming up and addressing those with preventative training topics begins to build a Best Practice Safety Program.

Accessing Content for Training

Locating “Toolbox” trainings can be time consuming and, in some cases, costly. And very often, the trainings may not be applicable to your operation and/or the trends you may need to focus on. With an eye to the future, Rancho Mesa has recently introduced a proprietary SafetyOne™ App. Safety managers will be able to document safety inspections from their mobile device and assign required fixes to employees, while also tracking when they have been completed. Meeting content can also be distributed to supervisors through their mobile device all with a focus of making safety meetings more efficient and effective. These same supervisors can now access a vast library that can be customized to their operation. 

Reach out to me to learn more about the SafetyOne™ App and how Rancho Mesa can partner with you and your team moving forward. You can reach me at (619) 438-6900 or email me at ccraig@ranchomesa.com