N.Y. Workers’ Comp Assessments Remain Highest in Nation
According to the annual study conducted by Workers’ Compensation Policy Institute, New York States workers’ Compensation costs is nearly 5 times the average of the same surcharge in other states.
Minnesota is the state with the second highest surcharge with an 8.3% tax and New York more than doubles that with an 18.8% surcharge.
These surcharges, or assessments, are essentially a tax on workers’ compensation premiums and are used by state governments to fund the system. 32 states imposed this premium tax averaging an assessment of 3.8%.
In 2007, Workers’ Compensation Reform Act, for that year, attempted to reduce the burden on New York employers. In the last three years, however, New York State has increased this tax by 10.4%, then increased by another 27.5%, and finally decreased by 6.9%, respectively. In 2012 assessments nationwide were down by an average of 9.5% while assessments in New York decreased by 6.9%.
The Workers’ Compensation Policy Institute says local governments expected some relief from the burden of assessments through the Worker’s Compensation Reform Act in 2007. Assessments stood at 18.6% of premium prior to passing the reform act of 2007. Since then, New Yorkers were charged 15.5%, 13.4%, 14.2%, 18.1%, and 20.2%
The Institute’s new analysis shows that assessments are continuing to be a larger part of increasing costs, and employers pay nearly 50% more of their compensation dollars in assessments to fund the system than they did 4 years ago.