State Insurance Plan Considers Jobs’ Risks
Missouri is one of the first states in the nation with a program intended to equalize workers’ compensation premium rates among workers earning various wages whose jobs pose similar risks.
The program is considered an important one for the construction industry, where holding down costs is a crucial matter.
Until this year, Missouri’s union contractors paid premiums for their workers based entirely on their total wages and with no regard to the risk involved in the workers’ jobs. The more the contractors paid employees, the more they paid for workers’ compensation insurance.
That changed Jan. 1 with a premium adjustment program adopted by the Missouri Division of Insurance. Under the program, contractors who hire higher-paid union craftsmen and have good safety records can apply for a premium credit. The credits apply only to a policy with one or more contracting classifications.
The credits begin at 5% for workers paid $12.00 to $13.50 an hour and increase to 20% for those paid $21.01 and over.
“This program will have a positive impact on the cost-effectiveness of union construction in St. Louis and throughout the state of Missouri,” said Robert P. Elsperman, president of Tarlton Corp. in St. Louis and co-chairman of a task force that advocated the change. The task force was composed of St. Louis union and management leaders who worked two years under the auspices of the city’s PRIDE organization.
PRIDE, founded in 1972, stands for Productivity and Responsibility Increase Development and Employment. It is a cooperative effort of construction users, contractors, AFL-CIO craftsmen, architects, engineers and construction suppliers in the St. Louis metropolitan area.
The task force provided evidence to the insurance division that would support the change, said Richard Mantia, labor co-chairman of the task force and executive secretary-treasurer of the St. Louis Building & Construction Trades Council.
“The burden of proof was on us, and we were able to provide the required actuarial documentation to demonstrate that contractors employing well-trained union craftspersons should be rewarded, not penalized, for their safety programs,” Mantia said.
