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Construction industry payroll reporting
Payroll information for construction employers

Proper payroll reporting

BWC bases premiums on wages and exposure to hazard. Therefore, it's critical you report wages within the manual classification(s) in which your employees performed the work. Job orders and hourly segregation (timesheets or job logs) showing labor costs can help you create worksheets to track the reporting of your payroll. Keep these worksheets in the event of an audit. If you do not separate these wages, you must report them to the highest-rated classification assigned.

Construction cap

We provide a salary cap for construction employees. Employees reportable to construction manual classifications are eligible for exemption of weekly wages greater than 150% of the statewide average weekly wage.

You must deduct section 125 cafeteria plan deductions before you calculate the salary cap.

Spread out bonuses paid in the policy year among the weeks worked during the policy year. The total is subject to the weekly construction cap.

The weekly construction cap does not apply to officers of the corporation. The corporate officer minimum/maximum requirement supersedes the weekly construction cap.

It's imperative to keep weekly worksheets and payroll records calculating this excess by week per employee and classification. In the absence of these weekly records, you can only take advantage of the cap on the whole payroll reporting basis.

If an employee's wages are reportable to more than one construction manual, we allocate the construction cap to each classification based on the percent of time worked in that classification for the week.

Weekly construction cap

Payroll period Payroll limitation cap
July 1, 2020 - June 30, 2021 $1,470 per week
July 1, 2019 - June 30, 2020 $1,425 per week
July 1, 2018 - June 30, 2019 $1,398 per week
July 1, 2017 - June 30, 2018 $1,353 per week
July 1, 2016 - June 30, 2017 $1,328 per week
Jan. 1, 2015 - June 30, 2016 $1,293 per week

If an employee's wages are reportable to more than one construction manual, allocate the construction cap to each classification based on the percentage of time worked in that classification for the week. For example, if the weekly cap is $1,398 and the weekly wage is $2,000:

Manual Pay allocated to manual % of Wage x cap = Reportable wage
5403 $1,200 60% x $1,398 = $839
5213 $800 40% x $1,398 = $559

See an example of a construction worksheet for policy year 2018.

NCCI class codes that qualify for construction limits
0042 0050 0106 1322 3365 3719 3724 3726 5020 5022 5037 5040 5057 5059 5069 5102 5146 5160 5183 5188 5190 5213 5215 5221 5222 5223 5348 5402 5403 5437 5443 5445 5462 5472 5473 5474 5478 5479 5480 5491 5506 5507 5508 5535 5537 5551 5605 5606 5610 5645 5703 5705 6003 6005 6017 6018 6045 6204 6206 6213 6214 6216 6217 6229 6233 6235 6236 6237 6251 6252 6260 6306 6319 6325 6400 7538 7605 7855 8227 9534 9554

1099s

Use of independent contractors is common in the construction industry and some other industries. They usually receive a 1099 instead of a W-2. Employers do not pay payroll taxes on these workers.

Questions frequently arise about the legal status of a particular worker as an employee or an independent contractor. Where a construction contract is at issue, the "right to control" test is not used as the basis for a determination. BWC must apply the 20 specific factors in ORC 4123.01(A)(1)(c). An Independent Contractor/Employee Questionnaire (UA-2) is available.

It's common practice to use written contracts. It's also common for the general contractors to obtain a copy of and maintain subcontractors' workers' compensation certificates of coverage, liability insurance and invoices and/or bids for the services provided.

Ohio employers have a duty to properly report required information to BWC for proper calculation of premiums. Employers who fail to secure, maintain or properly report required information for workers' compensation coverage may be subject to criminal prosecution.

A primary contractor may be liable for claims filed by employees of sub-contractors when the sub-contractor fails to provide workers' compensation coverage for its employees

Construction or erection estimator

Manual classification 5605 applies only to employees of construction, erection or rigging operations who estimate the cost of jobs outside of an office environment with exposure to field hazards on potential or prospective job sites. Additionally, we classify salespersons that take measurements at potential job sites, commercial or residential, as estimators. Manual 5605 is not available for division of a single employee's payroll with any other classification. This includes clerical (8810), sales (8742) or construction superintendent (5606).

Contractor - project manager, executive supervisor or construction superintendent

We also allow employers to report project managers, executive supervisors and construction superintendents of construction businesses to a separate classification if he or she meets certain conditions. This classification applies to those who spend time in the office and visit various active job sites conferring with a job superintendent or job foreman. These visits are usually to check progress at each job site or project. To qualify for code 5606, this person must:

  • Not perform any construction work.
  • Exercise supervision through job-site supervisor or foreman.
  • Not have direct charge over the workers at the site.

Manual 5606 is not available for division of a single employee's payroll with any other classification, including clerical (8810), sales (8742) or estimator/bidder (5605). Those employees that engage in both estimating and construction superintendent duties are reportable to the 5606 classification.

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