PCRB Update to PA WC Manual Due to COVID-19

Denise GillinInsurance, News

On May 5, 2020, the Pennsylvania Compensation Rating Bureau released an update to the Pennsylvania Workers’ Compensation Manual, specifically to address issues related to the COVID-19 pandemic.  The new provisions have been approved by the Insurance Commissioner, and will apply from April 1, 2020, or later for policies in force on March 1, 2020, through December 31, 2020.

Following is a summary of the changes as presented and what they may mean for PA employers.

Allocation of Payroll

The COVID19 Coronavirus Exception allows for temporary reclassification of payroll for employees working from home to Code 953 – Clerical Office during laws or regulations issued due to COVID-19, if separate, accurate and verifiable records are kept. Once normal operations resume, appropriate classifications should be applied.

Employer Payroll Classifications

When the temporary interruption or suspension of normal business activities caused by COVID-19 results in a change in business operations, an employer may be temporarily assigned to an alternate classification if separate, accurate and verifiable records are kept. Once normal operations resume, appropriate classifications should be resumed.

Premium Basis

Payments made by employers to furloughed employees as a result of federal, state or local emergency laws or orders related to COVID-19 are not included as employee remuneration.  Further, they define furloughed employees as those who continue to receive payments during a temporary layoff or involuntary leave, and are not performing any work duties for their employer. “Idle workers”, or those who are not working for other business reasons not related to COVID-19, are not furloughed employees.

Experience Modification Calculation

Incurred losses by policy year for each employer are used to calculate Experience Modifications, and include both medical and indemnity payments. With this amendment, claims assigned to Catastrophe Code 12 (Coronavirus) will not be included in experience modification calculation.

Similarly, payroll to furloughed employees, will not be included in payroll used to calculate experience modification factors.  Insurance companies will track this payroll using statistical code 1212 which employers may see on their workers’ compensation policies in the future.

Insurance companies are now in the process of modifying their systems to allow for the addition of classification 1212 and further segmenting both payroll and loss information.  As an employer, your best course of action is to keep separate, accurate and verifiable payroll records for furloughed employees and those that may be working from home in a clerical capacity; so that it is available when requested.   We will share more specific information as it becomes available from your insurance company.

As always, please feel free to contact your Murray representative at 717.397.9600 if you have any questions.




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