# Workmans Comp code 0042 and 0106



## Bill Becker (Sep 30, 2015)

Anyone having trouble in the last 2 years with being able to separate employees payroll classification codes?

I've been able to do this for 24 years by maintaining accurate records. Now I'm required to pay for code 0106 (Tree pruning) for everyone. I have employees who never climb (Code 0042 Landscape Gardening). If I have a climber pruning a tree with me doing the cleanup and chipping on a job and also have a groundsman 100 yards away doing weeding, edging and mulching of landscape beds I now have to pay his WC at code 0106. The cost is 17% of payroll for 0106 and 7% for 0042.

I know other business owners in other types of business who are having the same problem.


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## ATH (Sep 30, 2015)

Is that a change in State policy or your insurance company?

Ohio is monopolistic, so we are a bit..."different" than others, but my understanding is like what you said: If there is any overhead pruning on the job, it gets coded as tree pruning (24.somechange%). I had to call and beg for other codes, so I now use maintenance (6 or 7%) and installation (3 or 4%) as appropriate. If we physically leave one job site and go to another that falls under a different classification, I will switch codes.

I don't have the codes in front of me right now...


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## Bill Becker (Sep 30, 2015)

My insurance company. Most companies will not cover Tree Pruning. Those that do are requiring a minimum premium of $10K - $20K. They all interpret the state code classifications as they see fit. Even though I maintain detailed payroll records the auditor can state that the records are not adequate. Auditors are hired by the insurance industry and favor them.

How have your audits been the last 2 years?

From the code classification description:

*Examples of Workers Compensation Code 0106*

BRUSHING-AS PART OF TREE WORK
CHRISTMAS TREE HARVESTING EXCLUSIVELY;
RIGHT-OF-WAY CLEARING: SPECIALIST CONTRACTOR ENGAGED IN TREE PRUNING;
TREE PRUNING, SPRAYING, REPAIRING – ALL OPERATIONS AND DRIVERS
*Exclusions for Workers Compensation Code 0106*

No payroll division is permitted for employees who may remain on the ground picking up branches, doing chipping or shredding, etc. Those operations are part of Code 0106. Any actual landscaping operations such as lawn mowing, shrub or bush or hedge trimming, or planting operations may be assigned to Code 0042
*0042 - LANDSCAPE GARDENING*

Definition of* Workers Compensation Code 0042: *This classification includes laying out grounds, planting trees, shrubs, flowers or lawns.

Code 0042 applies to the(...) *Term details*" class="glossaryLink cmtt_NCCI Class Codes cmtt_Workers Compensation Class Codes">0042 providing adequate payroll records are maintained.


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## stltreedr (Oct 19, 2015)

My ins. co allows me to split it, as long as I have the corresponding invoices at the end of the year when they do the audits. The invoices have to be proportional to the wages paid. The whole thing just pisses me off.


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## Bill Becker (Oct 19, 2015)

stltreedr said:


> My ins. co allows me to split it, as long as I have the corresponding invoices at the end of the year when they do the audits. The invoices have to be proportional to the wages paid. The whole thing just pisses me off.



What do you mean by "The invoices have to be proportional to the wages paid"?


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## stltreedr (Oct 19, 2015)

If there is $2000 worth of tree work and $200 worth of landscaping, you cant say there was 15 hrs of landscaping and 4 hrs tree work.

If the job is 80%tree work, the hours should be 80% on 0106.

Make sense?


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## Bill Becker (Oct 19, 2015)

stltreedr said:


> If there is $2000 worth of tree work and $200 worth of landscaping, you cant say there was 15 hrs of landscaping and 4 hrs tree work.
> 
> If the job is 80%tree work, the hours should be 80% on 0106.
> 
> Make sense?


Yes, thanks. Unfortunately for me my insurance company decided two years ago to require all my payroll be under code 0106 since part of it is. Their policy/requirements now state that "If any part of the business operations include tree pruning (0106) then all payroll will be subjected to code 0106".


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## ATH (Oct 19, 2015)

If you do enough landscaping that is not overhead tree pruning, you might consider starting a different company (on paper). It would be more paperwork to manage 2, but might be well worth it??? Logging companies separate their trucking all the time...


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## Bill Becker (Oct 19, 2015)

My insurance company makes me sign a document stating that I do not own any other business.


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## ATH (Oct 19, 2015)

What if you did? What if you owned a couple of rental houses on the side...would that be a problem? I suspect (but don't claim to know) that they are making sure you are not hiding a company with a high accident rate report. They may be perfectly fine with having a second company as long as it is fully disclosed???


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