California employers are required by law to have workers’ comp insurance, even if they have only one employee.
The California Department of Industrial Relations (DIR) imposes assessments on employers to cover the cost of potential workers comp claims. The amount a business pays into the system depends on how many employees a business has and what its total payroll is.
California has been ranked as the most expensive state for workers’ compensation costs, according to a newly released report.
The Workers’ Compensation Premium Rate Ranking Summary from Oregon’s Department of Consumer and Business Services shows that California businesses spend $3.48 for every $100 of payroll issued.
That’s 188 percent of the median cost of $1.85 for all 50 states. California was the third most expensive state in 2012 and the fifth most expensive in 2010.
“California’s workers’ compensation system is incredibly inefficient,†said Jerry Azevedo, a spokesman for the California-based Workers’ Compensation Action Network, which seeks to reduce costs for employers and improve services to injured workers. “It does not do a good job of achieving its goal. For as much as employers pay, they don’t get a lot out of it.â€
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