For annual payors, premium is due by the 10th of February of each year. For monthly payors, premium is due by the 10th of each month based upon your prior month's payroll figures.
What if I have no payroll for a particular month(s)?
If you have no payroll, a monthly report must be submitted by the 10th of each month showing zero payroll and premium due.
Is there a specific payment structure that applies to monthly payors?
Yes. Payroll report and payment are in the Fund Office for the previous month's payroll on the 10th of each month. By the 20th of each month, if payroll and payment due have not been received, a delinquent notice will be issued to the member. By the 27th of each month, if payroll report and payment due have not been received, a thirty (30) day CANCELLATION NOTICE will be issued to the member. Members who do not pay their monthly payments on time result in increased business expenses to the Fund. To help maintain the Fund's low competitive rates, please pay promptly!
Who do I make my check out to?
Checks should be made payable to KY AGC/SIF and please include your policy number with any correspondence.
Where do I mail my annual bill, monthly report and payment or zero report?
Calculate overtime hours worked at the straight time rate.
How do I complete my monthly payroll report?
Complete your monthly payroll report by doing the following:
Enter payroll amount in column 3 for each code and classification.
To calculate premium, take Payroll X Rate equals Premium (an easy way to do this as the rate is per $100.00 of payroll is to move the decimal point of the payroll over two (2) places to the left and then multiply it by the rate).
Add the premium column down, this will be the "Total Manual Premium".
The next step is to multiply the Total Manual Premium by the Experience Modification. One of the following three examples will apply:
If the Exp. Mod. is a 1.00, the Total Manual Premium and the Total Standard Premium will be the same.
If the Exp. Mod. is more than a 1.00, multiply the Total Manual Premium by the Exp. Mod. Do not add or subtract this amount, the figure calculated is what the Total Standard Premium is and should be greater than the Total Manual Premium.
If the Exp. Mod. is less than a 1.00, multiply the Total Manual Premium by the Exp. Mod. Do not add or subtract this amount, the figure calculated is what the Total Standard Premium is and should be less than the Total Manual Premium.
Discount: If a discount applies, multiply the Total Standard Premium by the discount rate to get the Total Normal Premium.
KY Assessment Tax: The KY Assessment Tax is determined annually by the KY WC Funding Commission. Multiply the Total Normal Premium by the KY Assessment Rate for your total payment due.
If the Total Amount Due and the amount of the check are not the same, please explain why there is a difference, so that we may process your account accordingly. Please Note: Monthly reporting is a payment plan only. The amount of payroll reported, use of classifications, and assignment of employees, casual laborers, or uninsured subcontractors to classifications are subject to change at audit.
What payroll is to be included on my Payroll Reports?
Gross payroll including:
Wages or salaries including retroactive wages or salaries
Total cash received by employees for commissions and draws against commissions
Bonuses including stock bonus plans
Pay for holidays, vacations, or periods of sickness
The rental value of an apartment or a house provided for an employee based on comparable accommodations
Payments to employees on any basis other than time worked, such as piece work, profit sharing or incentive plans
The value of lodging, other than an apartment or a house as in (5) above, provided as a part of pay
The value of meals received by employees as a part of pay to the extent shown in the payroll records
Payment by an employer of amounts that would have been withheld from employees to meet statutory obligations for insurance or pension plans such as the Federal Social Security Act or Medicare.
Payments for salary reduction, employee savings plans, retirement or cafeteria plans (IRC 125) which are made through employee-authorized salary reductions from the employee's gross pay
Davis-Bacon wages or wages from a similar prevailing wage law paid to employees as listed in their gross pay before deductions. (Prevailing wages)
The value of store certificates, merchandise, credits or any other substitute for money received by employees as part of their pay.
What payroll is to be excluded on my Payroll Reports?
Please exclude the following from your Payroll Report:
Tips and other gratuities received by employees
Payments by an employer to group insurance or group pension plans for employees. (These payments would not show up in an employees's gross payroll before deductions.)
Dismissal or severance payments except for time worked or accrued vacation
Payments for active military duty
Expense reimbursements to employees to the extent that an employer's records substantiate that the expense was incurred as a valid business expense
Supper money for late work
Work uniform allowances
Sick pay paid to an employee by a third party such as an insured's group insurance carrier which is paying disability income benefits to a disabled person
Employer provided prerequisites("perks") such as:
An airplane flight
An incentive vacation (i.e. contest winner)
A discount on property or services
Tickets to entertainment events
Payments by an Employer into third-party pension trusts for the Davis-Bacon Act or a similar prevailing wage law may be excluded, provided the pension trust is qualified under IRC Sections 401(a) and 501(a). Note: 401(k) and IRC 125 plan contributions by EMPLOYEES are still INCLUDED for premium computations.
Do I need to report payroll on Independent Contractors, Subcontractors, and Contract Labor?
The AGC/SIF charges premium on every subcontractor who has not provided our member with a Certificate of Workers' Compensation Insurance for the period worked. There are no waivers, Form-4's, or other contractual agreements that can be submitted that are acceptable to the Fund. Only valid certificates for the time period the work is performed will exclude these subcontractors. This includes, but is not limited to, sole proprietorships and partnerships with no employees, other subcontractors, independent contractors, and contract/casual laborers with no employees and/or no certificates of workers' compensation insurance. See your policy, Part Five-Premium, Section C, #2 located on page 6.
How is premium calculated for Uninsured Subcontractors?
If the contractor does not provide satisfactory evidence that the subcontractor had workers' compensation insurance in force covering the period the work was performed, additional premium shall be charged as follows. The full subcontract price will be used for premium computation purposes unless:
A complete payroll record of the employees of the uninsured subcontractor is provided. If provided, the actual payroll will be based on the classifications which would have applied if the employees of the subcontractor had been employees of the contractor. Note: Subcontractors working for your Uninsured Subcontractors are not automatically covered under your AGC/SIF Workers' Compensation policy. Please contact the Fund Office for clarification if needed.
If invoices submitted to the contractor from the uninsured subcontractor discloses that a definite amount of the full subcontract price represents payroll, such amount shall be the payroll for the additional premium computation. In contracts for labor and material, the payroll shall not be less than 50% of the subcontract price. Invoices must be on the subcontractor's own letterhead, providing actual breakdowns. Only actual invoices are acceptable, not letters stating or estimating material costs. Estimated percentage breakdowns are not acceptable. Additional premium will be based on the classifications which would have applied if the employees of the subcontractor had been employees of the contractor.
If an experience modification has been established for the contractor, such experience modification shall be applied to the premium developed for the uninsured subcontractor.
Contract or Casual Laborers: All workers hired and paid without tax deductions are considered contract laborers or casual laborers. If an accident occurs, these laborers may be eligible for Workers' Compensation benefits. As a result of this, additional premium is developed based on total amounts paid to these laborers. Additional premium will be based on the same classifications which apply to your employees based on work performed.
If your company hires a subcontractor from OUT-OF-STATE, a certificate of insurance from the subcontractor must specify coverage for the state of Kentucky (if the work was performed in Kentucky). If not, the subcontractor will be treated as an uninsured subcontractor.
Are there any other special reporting procedures?
For ACTIVE CORPORATE OFFICERS, include actual wages paid or:
INCLUDE a minimum payroll amount of $46,800.00 per year for Executive Officers (i.e. President, Vice President, etc.) who receive no salary or less than the minimum.
EXCLUDE Executive Officers' payroll which EXCEEDS $192,400 per year ($3,700.00 per week). Applies only to Executive Officers.
PARTNERS and SOLE PROPRIETORS who ELECT coverage must report a flat $47,700.00 per year.
Overtime: Figure workers' compensation premium due on all overtime hours worked BUT at the STRAIGHT TIME rate. For any questions that may arise, refer to either your Fund Facts or your Manual.