Originally published May 23, 2019.
Updated September 19, 2019.
Author, Sam Clayton, Vice President, Construction Group, Rancho Mesa Insurance Services, Inc.
In an effort to keep you informed, so you can begin budgeting for 2020, we want to let you know of the approved changes in the dual wage classifications effective January 1, 2020.
The increases range from $1.00 to $3.00 per hour, to keep the thresholds in line with inflation. However these changes will have an immediate effect on your bottom line.
In the classes of business that are facing a $3 increase, this equates to a low of 9.3% to a high of 10.3%. See the chart below for the actual approved changes. Not only does this have an impact on wages, payroll taxes, and your bottom line, it may also have an impact on your workers compensation premiums. If you find yourself in a situation where the wage increase is not practical, this will push those employees into the under classification which will have a substantially higher workers compensation rate. In either case, proactive planning will be required so you’re not caught unprepared.
Following are the individual classes and approved changes:
Dual Wage Thresholds
| Classification | Current Threshold | 2020 Threshold | Threshold Difference | Last Changed |
|---|---|---|---|---|
| 5027/5028 Masonry | $27 | $28 | $1 | 2013 |
| 5190/5140 Electrical | $32 | $32 | $0 | 2018 |
| 5183/5187 Plumbing/Heating/Refrigeration | $26 | $28 | $2 | 2014 |
| 5185-5186 Fire Sprinkler | $27 | $29 | $2 | 2009 |
| 5201-5205 Concrete or Cement Work | $25 | $28 | $3 | 2018 |
| 5403/5432 Carpentry | $32 | $35 | $3 | 2018 |
| 5446/5447 Wallboard Application | $34 | $36 | $2 | 2018 |
| 5467/5470 Glaizers | $32 | $33 | $1 | 2019 |
| 5474/5482 Painting/Waterproofing | $26 | $28 | $2 | 2018 |
| 5484/5485 Plastering or Stucco Work | $29 | $32 | $3 | 2018 |
| 5538/5542 Sheet Metal Work | $27 | $27 | $0 | 2014 |
| 5552/5553 Roofing | $25 | $27 | $2 | 2018 |
| 5632/5633 Steel Framing | $32 | $35 | $3 | 2018 |
| 6218/6220 Excavation/Grading | $31 | $34 | $3 | 2018 |
| 6307/6308 Sewer Construction | $31 | $34 | $3 | 2018 |
| 6315/6316 Water/Gas Mains | $31 | $34 | $3 | 2018 |
In an effort to help control workers compensation costs, we have developed several proprietary programs including the RM365 Advantage Safety Star Program™ and RM365 StatTrac™ that can help control these increases. Please reach out to me at sclayton@ranchomesa.com to ask any questions about the above or to learn more about our proprietary programs.