Ball Park On Workers Comp

scottstef

hey guys. Business has been booming for me and i am contemplating hiring some guys as a dedicated paint crew. can anyone tell me what the going rate is for worker's comp is for residential paint jobs in/around the baltimore maryland area? i plan to focus on residential painting 90-95% interiors with maybe 5-10% exteriors less tha 35' feet high.

it would also be interesting to see what the going rate is for people all accross the country.

i tried to get a few quotes from insurance agents, but that is a whole different story.

also, what are the other associated costs with having employees?
i don't plan to offer any benefits other than a paycheck.

fica- what percentage of pay?
unemployment- what percentage of pay?
anything else i am forgetting?

thanks,
scott

mdshunk

Why is that a whole different story, Scott? Most interested...

scottstef

because i have been playing phone tag with teh agents for 3 days now. they want all sorts of crap that i really don't want to give them i.e. ssn or ein. a life history trying to get the rest of my insurance business.

i am still at the formative stages trying to get the gist of teh numbers so i can make sure i can get the numbers to work.

Humble Abode

There is no way you are going to be able to get an insurance agent to give you quote without first analyzing their risk i/e taking your SSN and EIN to run your history to find out if you are a liability. What if your EIN tells them you are being sued by a former employee for their medical bills? That ups your risk and changes your rate.

Or they find out from your SSN that you have been jailed for drunk driving? That ups your liability and changes your rate. (disclaimer: these are just examples. I make no claim to knowing, nor do I care to know, how insurance rates are calculated)

Seems like it would be a lot easier to call a few and hand over your info. You would get a clear view of what you would be paying in a matter of hours as opposed to all the members of this board posting all their drastically different insurance rates and leaving you more confused then when you asked.

just my 2 cents...

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Just because some of us can read and write and do a little math, that doesn't mean we deserve to conquer the Universe. Kurt Vonnegut, (1922 - 2007) from the Novel 'Hocus Pocus'
The NAPP
Milwaukee Painting Contractor

BMAN

I pay about 25 cents on the dollar for every dollar I pay out for each employee for all the insurances, Disability, comp, unemployment. eleven percent of that is comp.

KENNEDY

I'm about the same as BMAN with comp at 10.4%.

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Sean Kennedy
St. Louis Painting Contractor
Kennedy Painting LLC

PipeGuy

What business are you in? You might want to get an accountant.

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Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn

Paul Burns

I agree with BMan and Kennedy.

Our Labor burden can go from something like 23% - 40% of direct labor costs, NOT gross sales price.

In Florida, I think we pay something like 21% for W/C alone. We use an employee rental firm down here. I forget what the corrct name for them is, but you can google them.

In VA, since we had gone 20 years or more without a claim, we had it down like 6.5% for W/C. Then they raised it back up to around 10% for reasons that I still don't quite understand. I think the industry as a whole had more claims.

Then of course for the total labor burden, it will depend on the benefit packages and such that you give them, if any.

THIS is an INVESTMENT in your employees, your company, and your sleep. It will also seperate you from a LARGE portion of your competition. So it is really, IMO an investment, not an expense, although as far as the IRS is concerned......LOL

Paul
p.s. Don't feel too bad though. I think roofers pay something like 100-150% of direct labor costs! OUCH!

Grumpy

Roofing is 37% of payroll in IL. Painting is much cheaper. You see rates vary by the type of work you do, the type of buildings you work on, and the area you are located. Painting is usually about the cheapest around here. I have met some guys who cheat by getting insured to paint, but are doing framing or other such construction.

I pay 37% for wc, 19% for GL, 4% for unemployment, and fica is about 10% (my share). However again these numbers will vary by trade and geographic location. I figured out at one point I pay out 75% of payroll towards labor burdens. So if I am paying out $10,000 in payroll to my employees I have to add on $7,500 to goo to some insurance company or government agency. I have a payroll service that does everything except my insurance payments.

Definetly get yourself an accountant. Knowing YOUR numbers is what will determine YOUR success.

scottstef

thank you for your responses. i firmly believe in accountants and have a GREAT one. At the same point, my usual method of work with him and my businesses is to do my homework first. Write out a detailed analysis and business plan. Then i run it to my accountant to make sure i have the numbers correct. once i have done all of that, i run it past a mentor i have and several of my business school professors. Then if it all adds up i will go with it.

thanks

bergenbldr

Scott,hook your self up with good payroll sevice,such as adp/easypay. No way a small guy can do his own payroll with all of the forms/returns requiered both state and federal,plus all you do is call in your employees hours once a week and the checks are signed and deleiverd. All for about $36 a week.

Debookkeeper

1.45% for medicare and 6.2% for social security - is your contribution (which is a match to the employees taxes) not sure what your state unemployment rate is, but they usually start you at a fixed percentage when you don't have any employee history and adjust it yearly based on your unemployment claims. If you happen to use quickbooks already I would go with quickbooks payroll service subscribtion.. it's around 200.00 a year I think and you can do your own payroll and jobcost.

Paul Burns

Quickbooks is one of the best eye opening things tha ever happened to us. I don't know how we ever got along without it. Yes I do, before that we were using One Write Plus, I think it was.

Anyway, with QB it so easy to see if you are profitable or not and why. I would encoourage everyone that doesn't have QB or equivllent, to get it. It can make life much easier to understand and get a grip on your true costs of doing business!

Paul
p.s. Glad to see an accountant here.

Brushslingers

I would also suggest that you spend the extra and get pro... QB is nice, but QBpro.. well, your a pro right?

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Benn

Debookkeeper

I would only recommend using Quickbooks for your business if you have some fundamental understanding of accounting, if not - you could be in a world of trouble! So either hook up with an accountant that deals with quickbooks, or hire someone to set up your company info for you - but if you know the basics, it's great! I have been using quickbooks Pro for 10 years and Contractors edition for 1 1/2 years.

Paul Burns

Benn,

I think it the 5 user version of QBPRO that we use 2004, I believe. I could look, but too lazy to make 4 clicks. LOL

Debookeeper, that is also good advice, but even some accountants aren't very good at setting them up for paint contractors. I mean, I know it will work okay and all, but having the right numbers in the right spots is really important for me anyway.

I found our best accountant through the QB search thing that came with it. She was GREAT, but finally found the good life and quit. But, it was VERY important for her to sit down with me in a comfortable situation and is she wanted a number in a place that I din't, we would have to talk it over and she would win some and I would win some.

Some of these accountants can really be jerks. And they look at paint contractors like they are lessor people or something. so they are really like doctors and lawyers or anyone else for that matter, and if you don't trust them and can't ask questions freely, they are not worth the money. If you can find ones that you can talk to freely and ask questions, etc.. they are worth 10X's whatever you pay them!

Paul

Paul Burns

debookeeper,

What would recommend if they don't use or have QB's?

Paul

Brushslingers

Now THAT, is the truth.. I screwed up badly the first time a few years ago.. took loads of cash to get someone to fix it. My guy now starts babbling about depreciations and how I put this in the wrong spot, so I just walk out and bring him a beer... heh

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Benn

Debookkeeper

I don't have any recommendations! I have only used quickbooks, and I only work for contractors, so it has always worked out for me! Before quickbooks, I think I was working in three different DOS programs... can't remember that far back.

Debookkeeper

I TOO work for BEER!!