L&I Audits to affect painting industry
Date: February 24, 2009The Department of Labor and Industries (L&I) has announced it will conduct audits of selected employers in the painting industry. L&I has sent letters to painting contractors across the State in advance of these audits which are scheduled to begin on March 1, 2009.
The Department has found that workers' compensation rates for the exterior painting risk class (0504) appear to be too high, while rates in the interior painting risk class (0521) appear to be too low. This may be caused by some employers reporting more of their workers' compensation hours in the lower-cost interior painting risk class while reporting injuries mostly in the higher-cost exterior class, since more injuries would typically be expected in that class. The point of the audits is to determine whether or not this is the case and, if so, to correct the problem.
Employers will find that L&I is taking a new approach to industry-wide audits like this one. On February 10, L&I sent letters to more than 4,600 firms that report in one or both of these risk classes, letting them know what the auditors will be looking for and offering employers the opportunity to review their workers' compensation reporting practices before the audits begin.
A typical audit examines the past four quarters. In this case, if a firm discovers incorrect reporting and works with its L&I account manager to correct the problems, they will typically face four quarters of amended reports and will need to pay any premiums owed. The Department will minimize or waive penalties in most cases. However, once a firm is contacted by an L&I auditor, normal penalties and interest will apply if incorrect reporting is found.
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